Dima Kats is a highly qualified computer science graduate with over two decades of experience in the Fintech industry. He started Clear Junction in 2016 as a payment service for financial institutions. His company has since developed into an expert firm with innovative methodology and a platform that can process digital payments from all around the world in various currencies.
Clear Junction strives to make cross-border payments more straightforward for clients like banks, digital currency businesses, and marketplaces. The company has approximately 100 fintech professionals working for the company at its offices in London, Poland, and Latvia. In 2021, transaction volumes increased by an unprecedented 9,000%.
In this interview, Dima Kats shares his thoughts on the current state of the Fintech industry, how Clear Junction is solving cross-border payments, and what the future holds for the industry.
Dima Kats (Full Q&A Interview)
Question: What inspired you to start Clear Junction?
Answer: I’ve worked in finance for over 25 years now, and around seven years ago, I spotted a niche in the market where I saw a lot of pain and, as a result, a lot of potential- providing payment services to payment companies. These companies are traditionally underserved by banks, creating demand for our services. From there, we’ve branched out, but that was the inspiration for Clear Junction and what we still put in the centre of our product development strategy.
Question: Why is it important to pay extra attention to the international payments vertical of fintech?
Answer: As globalisation intensifies and more people have online access to their money, the need for making international payments grows too. At the same time, the risks traditionally associated with such payments are much higher than for domestic transfers. Among those risks are counter-party risk, FX risk, ML/TF risk and more. Increased demand and higher risk fuelled the fintech innovation in this domain starting from the end of the last century.
This domain has gone through some significant changes:
New payment vehicles have been introduced.
Global regulation has evolved dramatically.
Technological progress contributed to some new processes and interactions between market participants.
This evolution continues now with the introduction of cryptocurrencies and other blockchain-based services.
Question: What would it be if there was one piece of wisdom you could share with other executives in the fintech industry?
Answer: Rome wasn’t built in a day.
Question: Which fintech-related trends have stood out for you lately?
Answer: Open banking is an exciting trend that’s been picking up a lot of steam recently. It’s not a new trend, but as it progressed past its infancy and had more widespread adoption, it’s been developing very quickly. The potential for open banking to transform the customer experience in banking services makes it an almost unmissable prospect for financial institutions to miss out on. I expect that open banking will become an essential part of banking quite soon.
Another trend to watch is so called CBDC. That’s a fascinating use of blockchain that most governments across the globe are reportedly looking into adopting in the coming years.
Question: What are the best ways fintech companies can accelerate their growth?
Answer: It’s a simple answer; innovation. Over the past two years, a lot of investment has been pouring into fintech, but fintechs still need to demonstrate why they deserve that funding over their competitors. Carving out that niche by developing new technology with new applications is the most reliable way to secure financing and accelerate business growth.
Question: What positive technological and scientific innovations do you anticipate in fintech over the coming years?
Answer: Evolutions in data analysis and how those insights are applied still have a lot of room to grow in fintech. Using AI to analyse customer trends and personalise those to improve banking experiences and reduce financial crime is something I anticipate will be a significant area of growth in fintech in the next few years.
Speaking of technological innovation, we must mention blockchain. I expect it to affect many areas of our lives, not just fintech.
Question: How do you keep up with developments in the industry?
Answer: For a company like Clear Junction, which works with a wide variety of service providers within fintech, the number of developments to keep up with is enormous. We rely on open communication with our clients to understand their evolving demands and the hundreds of years of our team’s cumulative professional experience to respond to those demands. The first thing we consider regarding developments is risk. Is the idea exciting enough to take those risks, and can we manage them appropriately? We have our own clear red lines, but within that, we are open to any innovative idea.
Question: Please summarise your business life in three words.
Answer: Yes we can.
Question: What’s next for Clear Junction in the years ahead?
Answer: We’ve enjoyed such rapid growth over the past two years but continuing to remain true to our business pillars of compliance and security is how Clear Junction will continue to succeed.
We have never been one to rest on our laurels. We are working tirelessly to facilitate the next phase of growth, with new products and services being announced all the time (with more to come before the year is out). We plan to build on our success in the past few years and bring new team members to help with that. The next few years are looking very promising indeed.
With that, we are fully committed to sticking to our initial strategy of serving financial institutions. There are plenty of challenges in this area (such as opportunities!), so we will focus on them and won’t look at any other markets.