Paladin Blog

Aaron Silva

Recent Posts

CSI Leads Push for 10 Year Technology Contracts

Posted by Aaron Silva on Nov 19, 2019 10:27:29 AM

It continues to escape any common or practical business sense as to why a community bank would agree to voluntarily be locked into a 10-year technology contract.  More so, the fact that a 10-year contract even exists (is offered at all) questions the ethical standards of technology suppliers and their commitment to selling services that fairly meet the needs of community banks in exchange for a reasonable profit.  10-year technology contracts are neither reasonable nor assist Banks in meeting any of their business needs. In fact, these contracts are predatory, outrageous and exorbitantly profitable to vendors and not their client “partners”. While all legacy Core IT suppliers would love to handcuff their clients to 10, 15 and 25-year contracts (yes, we’ve seen 25-year deals) one supplier - CSI of Paducah, Kentucky (www.csiweb.com) - appears to lead the charge on lacing their customer base within these contract shackles.

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Topics: Fiserv, Jack Henry, Fintech, FIS

Forbes: FIS Retreats Under Pressure From GCC

Posted by Aaron Silva on Jul 18, 2019 12:12:49 PM

In late June, Forbes published an article on FIS recent attempt to unilaterally implement a new security surcharge on a select few of their clients without their permission (FIS has not stated publicly how many were targeted but GCC estimates there were 250-300 guinea pigs). These fees, costing several tens of thousands of dollars per client, were imposed because FIS stated it had recently improved its security infrastructure to address new threats and that they wanted to “partner” with their clients in sharing this expense. No explanation was provided as to exactly what these threats were or why they decided to deploy this tariff [now] and without the consent of their clients, even though each FIS client had already agreed to a security SLA guarantee in their existing agreements.

According to FIS, this security surcharge was justified, and in exchange they would extend indemnification to include the Banks’ client behavior subject to exclusions and Limits of Liability (LOL) already stated within their agreement.  LOL is traditionally woefully inadequate in most standard FIS agreements as it is and so this "benefit" really has no tangible value to a banking franchise. FIS stated that these kinds of security measures are becoming increasingly necessary, as cyber-attacks are growing in popularity and evolving in complexity.


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Topics: Fiserv, Jack Henry, Fintech, FIS

WSJ REPORTS:  Core IT vendors building tollways, not highways to bank-owned data

Posted by Aaron Silva on Apr 13, 2019 1:58:36 PM

The Wall Street Journal published a story about small banks beginning to rebel against the Big Three Oligopoly ("the BTO") of core IT suppliers Fiserv, FIS and Jack Henry - now commanding more than 90% of market share according to CELENT.  I was interviewed extensively by the writers about the ease (or difficulty) of technical access and economic affordability when banks need unfettered access to their data (i.e. for third party fintech partners).  While they are starting to provide access, they're doing it in a way that unfairly monetizes your data to their exclusive benefit.  Here's how.

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Topics: Fiserv, Jack Henry, Fintech, FIS

Negotiating Like a Boss

Posted by Aaron Silva on Mar 12, 2019 9:27:36 AM

How does a $1.6B mutual bank in a small Massachusetts community find a way to drop more than $4.4 million in cash to their bottomline without changing a single IT supplier or interrupting one of their online customers?

Simple. Beginning in 2014 they took the long-game view and intelligent approach to negotiating against their very powerful core IT suppliers and critical technology vendors. BayCoast Bank is run by Nick Christ and was recently awarded the prestigious ICBA National Community Bank Service Award, Grand National Winner, but Mr. Christ has a secret weapon within his ranks - Dan DeCosta their Chief Information Officer. Mr. DeCosta is as friendly as any banker has been created but inside he is a shrewd technologist and businessman that knows how to leverage the power of outside expertise, market intelligence and pricing data with the patience of a tortoise prepared to ultimately beat any other hare.

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Topics: Contract Negotiations, Paladin Success Stories

Terminate the Termination Fees: Banks must put an end to outrageous terms

Posted by Aaron Silva on Nov 5, 2018 2:18:26 PM

Excessive fees create a manufactured barrier to acquiring competitive technology that would help the banking industry survive and flourish. This is an unfair business practice at any measure and may not be legal in many states.

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Topics: Contract Negotiations, community banks, Credit Unions, vendor merger, M&A

Impact of Core and IT on Mergers and Acquisitions: Protecting Shareholder Value

Posted by Aaron Silva on Jul 12, 2018 11:27:09 AM

The vast majority of middle-market community banks and credit unions will at some point explore acquiring or being acquired because M&As are one of the quickest and most effective ways a bank can scale up, expand reach, and grow. Unfortunately, many of these banks have no choice but to watch lucrative M&A opportunities pass them by because they unwittingly agreed to grossly unfair and inequitable terms in their core and IT contracts.

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Topics: Contract Negotiations, community banks, vendor merger, M&A

Listen now: Evercore ISI interviews Aaron Silva

Posted by Aaron Silva on Jun 14, 2018 10:36:43 AM

Global independent investment banking advisory firm Evercore ISI interviews fintech expert Aaron Silva on all things banking. Listen now to Aaron's predictions for the banking industry: 

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Topics: Contract Negotiations, community banks, Fiserv, Fidelity, Jack Henry, Vendor consolidation, Credit Unions, vendor merger, M&A, Fintech, open banking

LISTEN NOW: Will open banking change banking-fintech partnerships?

Posted by Aaron Silva on Jun 13, 2018 5:23:44 PM

In this comprehensive expert panel discussion at LendIt Fintech 2018, Paladin's Aaron Silva leads a compelling and lively discussion about how financial institutions are navigating the exciting world of fintech. Topics include innovation, opportunities, resistance, analytics, security and much more. Four renowned experts participate in the podcast every bankers should hear. Listen NOW: 

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Topics: bank events, Fintech, open banking

Be Careful - That Quote May Be a Hand Grenade!

Posted by Aaron Silva on Jun 12, 2018 9:02:15 AM

 

Your bank is constantly looking for ways to improve its fintech as competition from the big banks steadily increases. Routinely you turn to your current core and IT suppliers for ancillary add-ons like mobile deposit, fraud detection, a CRM or a new EFT card services feature. There are a million options your supplier can up-sell that will improve the current core solution. There probably isn’t an institution in the United States that doesn’t have a quote on someone’s desk waiting for approval.

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Cost Control: Ferreting Out Hidden Costs to Improve the Bottom Line

Posted by Aaron Silva on Mar 26, 2018 10:28:19 AM

As we enter 2018, it's more crucial than ever for local banks to focus on their bottom lines, and for credit unions to improve member value. The number of banks with less than $100 million in assets has declined by more than two-thirds since 1995 — due in large part to big banks usurping market share. 

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Topics: Contract Negotiations, community banks, Credit Unions, M&A