Explore the Latest in FinTech with the TWIF Podcast!

Join us for a compelling episode where we delve into pressing topics like FinTech news, scams, and fraud. Discover how Helen's experience with a scam in Lisbon sheds light on the emotional impact and challenges in the finance world.

Learn about Sardine's innovative approach to fraud prevention and explore their vision for secure, trustworthy transactions in an increasingly digital age.

Gain insights from Soups, co-founder of Sardine, who shares valuable lessons on entrepreneurship and the future of fraud detection and compliance in FinTech.

This episode is a must-listen for anyone interested in the evolving landscape of fintech, offering expert perspectives and real-world experiences.

In this episode, host Helen Femi Williams was joined by one incredible guest:

• Soups Ranjan, Co-founder, CEO @ Sardine 

Listen here:

‎The This Week in Fintech Podcast: The TWIF Podcast, feat. Soups Ranjan (Sardine) on Apple Podcasts

‎Show The This Week in Fintech Podcast, Ep The TWIF Podcast, feat. Soups Ranjan (Sardine) - 19 Dec 2023

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Transcript

Helen 4:42
So Soups, lovely to meet you Soups is it? I'm saying your name correctly? Yeah,

Soups 4:47
yeah, absolutely.

Helen 4:48
So yeah, I guess my first question is how you explain what you do Sardine everything to your non FinTech friend or like how you experience your mom like someone who's just like what actually let me not assume your mom's Not in FinTech. But just yet anyone who's not in the field, like, how do you explain it?

Soups 5:04
Absolutely, yeah, society is all about fraud prevention, right? And helping consumers and businesses not lose money, right? Because as money movement and Commerce has increasingly moved online, you know, fraud, and scam has increasingly moved online as well. So pretty much all of us have probably received these, you know, fake phone calls or fake text messages, right? Where someone is pretending to be someone else, you know, trying to scam us into losing money than many of us probably have, you had either of phone stolen or credit card stolen or identity stolen, right.

So subsequently to that, oftentimes, we then find like, there's a large transaction made, you know, cards or new bank account open using our identities. And then of course, then after that, you don't have to go through the motions to file an Identity Fraud Report or call up a bank to reverse the transaction. Now, where sardine comes in is essentially to prevent all of that from happening. Right? So we work with banks, fintechs, financial service companies, payment processors, to help their customers and their customers will be consumers and businesses to help those customers and businesses from not losing money due to fraud and scams.

Helen 6:21
Okay, two things there. One, why the name Sardine? Because obviously, I think a fish when I think of Sardine, so curious about that.

And secondly, yes, fraud is such a problem. It's a growing problem. I actually feel like I'm a major demographic for like those scams, like, I'm young, I'm online, and I use my phone all the time. But I think when people think of fraud, they think of an elderly lady at home alone. So I just want to know what fraud looks like now, because I feel like I get these like scammy messages, emails, texts, kind of constantly, where I'm just generally like, where is my contact information? Because, like, why, why why am I getting it this much? As is this normal? Have I put my data somewhere that it can no longer achieve it? So I'm just curious how these trends have gone.

Soups 7:12
Absolutely. Yeah. So I'll answer your first question first. So why the name Sardine? Two things? Right. So one, we do fraud and compliance in one unified API, right. And SAR in Sardine stands for suspicious activity report. So that is what you have to file when there's a fraud or money laundering case. That is what you file with the the financial regulator like FinCEN in the US, etc.

And secondly, you know, it's a fishy name, right. So we help with, you know, all sorts of fishy stuff, right, fishy fraud, fishy scans. Right. So hence the name right? And to answer your second question, right, the trends for both fraud and scams are you know, that they're both like up into the right, right? And scams, in particular, they're growing faster?

Helen 7:59
What's the difference between frauds and scams?

Soups 8:02
Absolutely, yeah. So fraud would be you losing your credit card and somebody making a transaction on it. Or it could be you know, your your credit card got scammed, like people have these killing machines, right, they your card number got lost to a skimmer, and then they are not using your card number to make transactions, right. So that is fraud. It's more were due to some malware or due to your negligence whether as a consumer you lost your payment details, and somebody is not making payments on your payment instrument. Scam would be you are actually the one who authorised the transaction, right? Fraud is oftentimes you never authorise that transaction scam is you actually authorised it. So the scam would be, let's say, you know, investment scam, or let's take Tech Support Scam or gift cards can. So when you get these text messages, what they're trying to do is convince you to buy a gift card online, or convince you to go make a payment thinking you're making a payment for an IRS tax.

However, you're making a payment to the scammer, right? Or, you know, there's a bank refund scam, you think you're making a payment to the bank? Because you know, the caller tells you that hey, you the bank owes you $1,000 of defence. But for you to get the $1,000 you have to first send the bank $100 To prove you are the right person. And of course that money is not going to the real bank. It's going to the scammer. So in all those cases, you're authorising the transaction and hence the difference between scam and fraud.

Helen 9:31
No, I generally didn't know the difference, and I think I use them interchangeably. So it's quite it's quite interesting to know fraud is when you don't authorise it. It's more like stealing. There's a level of stealing that goes into it. And a scam is when there's a slight prior element of Have you said yes, but you just didn't know what you were saying yes to. I was actually scammed two weeks ago.

Soups 9:54
What happened?

Helen 9:55
so embarrassing to talk about

Soups 9:58
It's okay. There's no embarrassment for I've been defrauded before.

Helen 10:02
I think about scams, there's a level of emotion that goes into it that no other kind of not let me not say no other, but the emotional situation, you start to feel like, Oh, I'm so stupid, no one else would fall for this. And I think that's what like, prevents people from coming forward. And then these people can continue to scam people. And it's definitely how I felt when I was like, I don't even want to tell people that it was, um, scam. I took me the the only person I told was my sister and I made it like such a big deal. And she was like, Girl, like, relax, it's fine. But essentially, I thought I was sending someone money for a deposit for where, where I'm living in Lisbon. And they essentially, like the day before I was meant to move in. They were like, Oh, you need to pay more money, because someone else is interested in the property. And I was like, Don't worry, just give me back my money. Because it was like, you know, that I meant to move in here. Like, in less than 24 hours, you know, I have nowhere else to stay. And now you're telling me Oh, someone else has sent the money. But if you send 100 more euros, whatever, you can have it and I was just new. All right. I think I already knew in my head from before that that something was off. And then they just confirmed it for me. And I was like, Okay, sounds like the money. And then it was like, Oh, my lawyer needs to do this and did it. And it just became this, like, but what was weird is they kept contacting me. And I was just like, I don't want anything else but the money back. And essentially, they sent me like a quarter of it, which I don't know what that like what that was meant to entail. I don't know if there was a bigger scam here that I just maybe opted out of. And then I sent all the information, I did it through my Revolut and some of the money, they're able to kind of maybe recover because all the information is there. All the transaction stuff is there, but I doubt I'm gonna get it all back. But yeah, like definitely the thought process I had was how, how stupid. Am I to even put myself in that situation? So yeah, yeah, that was that was me being scammed, like two, two weeks ago.

Soups 12:00
Yeah, no, you're not alone. Right. Like it's, and I would certainly not say you're stupid for falling for it. That's, that's, that's what these scammers are very good at, like they are very good at interjecting themselves into something like this, because they probably knew that you were going to make the payment. Right? And then secondly, you know, the fundamental issue which is broken in payment systems worldwide, is the fact that no one knows the counterparty, you know that you are sending funds to no one knows if the counterparties identity and payment instrument the match?

Helen 12:36
Yeah, yeah, yeah. So So what Sardines doing is, that's like the fundamental issue that you're solving. Yeah. So

Soups 12:45
the long term vision for Sardine in the long term vision is that first and foremost, right, with the world increasingly moving towards faster payment methods, right?

And what we like to say is that with Faster Payments, comes faster fraud, with credit cards, etc. Right? Like, you know, there is a system built in to actually challenge or dispute a transaction that you meet. But with any of these faster payment methods. There's no dispute built in the money. Once it's gone, it's gone. In other words, it has three features. It's instant, it is not reversible. Right.

And, yeah, it's fungible. So it's in the sense that, you know, the person who's stealing the money can now you know, use it to buy anything else as well quickly. And the longer term vision there for us via several of the efforts we're doing, one of them being the consortium that we announced called Sardine next, is that we want to make sure that we can solve that core problem, like we want to make sure that we can have a database of who are trustworthy parties that I have transacted with and who are also the non trustworthy parties who are the scammers. What are the bank accounts they are using the funds are being funnelled into, because unless we share this information amongst a wide swath a wide swath of industry participants, we can't really solve for it.

Helen 14:25
Yeah, it's, I think you're so right, because it's it you this is the thing, though, about the element of like money and trust those like you. The concept of like, giving someone money that you don't know is like, not new, like, do you actually do not it makes me think of like, like, my heritage is Nigerian, and like, back in the day, I'm pretty sure my dad used to send money and I have no clue how it got to the person.

And it would be like so remote and so but it was like this person gave this person money and then this person, and it was just like this whole system of like, what appears to be unbanked, but actually is very, very complex and very documented. And maybe in a way, because it's like physical someone is giving the money to somebody else. So it's like, okay, people probably run away. People still do scams and frauds, but it's not as anonymous as maybe it is now.

So I guess this leads back to my previous question, sort of, but not really, but sort of around like how it has changed, because maybe I'm going super, super far back into like, okay, like, maybe in some countries with less infrastructure. This is what isn't a problem in a different way. But yeah, how do you see that change? Like, I know, we now see what sadena is going to fix all these issues in the future. But what are the emerging issues? Like? Like I said, I think I'm a prime product for like, what's cameras looking for? And I'm curious to kind of thing, see what you think of like, yeah, just how that is changing so much.

Soups 15:57
Yeah. So the the world of scam, or the amount of losses to scam has fast outpace the amount being lost due to fraud. A prime example would be the UK where they've had Faster Payments for about a decade now. And the dollar has been lost to faster payment scams also known as authorised push payment scams for Eclipse's fraud losses, right. And UK is, you know, kind of ahead of other countries in this right.

Soon, regulators are going to start taking a look at that problem very closely. So what is happening is that couple of things right. Now, and I think about this quite a lot. So there's a couple of things. One is the core problem is that, you know, when the internet was built, right? The we had like all the internet protocols, right? Like DNS for domain matching, or domain lookup, email, you know, sip for voice over IP, right? All these protocols, they never had any sender verification built in. Right?

So that's called problem number one, why it's a problem because you could actually send a text message or, or make a phone call, pretending to be a bank, right, because you can spoof the bank's phone number. And you as a consumer would never know that it's not your bank actually calling it's a scammer calling, because it'd be actually literally the bank's phone number. Right?

So that's fundamental problem number one, because we don't verify who sends the text and who actually makes the phone call. We don't do that. Right. And now imagine you've built banking, and we're building like, even more stuff on top of it, like faster payment methods, etc. On a very shaky foundation. Right? So, you know. So the, so the core of this problem is actually much larger, right. And the only way to solve for it is by building in, you know, signals, which can detect if somebody's being scammed in real time, right. And that is what we specialise in. So what we do is, let's say, oftentimes, like, if someone is scamming me of trying to scam me, they will, you know, call me and then have me do something on my bank. So we will, you know, if that bank has sardines, product or SDK installed, then we will tell you things like, hey, when soups are making the transaction, he was actually on a phone call and active phone call, which is rare.

Or sometimes they will say, hey, Soups, why don't you instal this tool called TeamViewer, anydesk, Citrix and you have these tools on your desktop, right? And he, I'll help you do KYC I'll help you do the money movement, right. And these are screen sharing tools, then the victim, then the target takes control of my screen and they start moving money, right, or sometimes they'll actually literally blank out the screen. And I don't even know what they're doing with the blank or the screen because they are in my bank, and they are moving money out to themselves. Right. So now Sardine also detects that there is an active remote session, or a remote screen sharing tool inactives session while I'm doing the bank transaction. Third thing they will do is that they will say hey, since Why don't you make screenshots because, you know, I'm calling from the bank, I need you to tell me Give me screenshots. They don't need the screenshots. They need the screenshots because they need to send it to their bosses so that they can get paid. So that's another method we apply right? And so yeah, so the unless you burn down the internet and build an internet 2.0 with proper sender verification, right? That's these are the only other methods we can deploy such as what we're doing at sardine know,

Helen 19:49
it makes so much sense and even like when you're talking about screen sharing, there's so many reasons like Like for instance, when your Mac or whatever your laptops broken up Often Apple asks you, like, share your screen with me so I can help you fix it. There's what I'm basically trying to say is like, there's many reasons even when I use my laptop, which is mine, you know, when you do transactions, it doesn't feel as secure even if you have all the, like security measures possible. So there is always this level of like, Is it someone watching? Do they consultancy, and even ever it sometimes an email looks so real, that you sort of think Oh, until you see the email address or something and you second guess it, but this these scams are these frauds are so complex in tech, and and they look so real these days that, you know, applications like that was just so helpful, I think for everybody of all ages. I was wondering, I'm gonna move on to like, some of the questions that previous guests have asked on the on the podcast. And this question. I'm just curious. One of the questions is, actually, yeah, this is a good question. What regrets do you have as a founder? Or do you have any regrets? Yeah,

Soups 21:03
if I were to redo the Sardine? I'll do a couple of things differently. Right. So one would be that I would make sure that I that I'm prioritising health work and life balance all three of them together, because you know, sardines are like close to four years old. But the first three years, I was just working really hard, like 18 hours a day. I didn't take break during the weekends, I didn't work on the weekend, spend time with my family and my two little kids. But, you know, I was not taking, putting health at a priority, I would sleep very little, I would be drinking like four or five double espressos a day, not exercising. And I paid a price with like, really poor health episode like a few months ago. So if I were to redo sardine, what I would do is like, I would actually prioritise health, like working out every day, right, which is what I do now.

Yeah, and then the second thing I would do if I were to redo Sardinas. During the early days of Sardine, you know, we, we hired our first sales leader too early, right, we didn't even have a product fully built out. Right? And that was a big mistake. You know, my learning now is that, you know, until you get to the first one or 2 million in ARR, you have to actually do founder led sales, right? So that sales rep didn't work out, we lost some time because of it. And then I'm not I'm not, I'm not a salesperson, right? Like I'm a I'm an engineer, machine learning engineer and a data scientist, right. So I had to teach myself how to sell right. But that in hindsight, was was great, right? Because the thing with founder led sales in the early days is that the product is not fully built out. So you have to gather active feedback from the customers. And then you have to go and continue to reiterate or iterate on the on the feedback. And the second thing is that since the product isn't built, you don't really have a lot of collateral that you can pass on to a salesperson. Right? So therefore, my recommendation now to any enterprise founder is to not hire you for a salesperson until you are like, at least 1 million in ARR.

Helen 23:18
I think there's two really, I think those are two really constructive, like thoughts. How is your sales? Now? Would you say you're a good salesperson? Yeah,

Soups 23:29
no. So I learned through the ropes, got my ass kicked, hundreds have learned through 1000s of rejections. Right? What I learned in sales is that you have to just be authentic, right? It's you have to bring your authentic self, you have to also build a solid relationship with your customer, right? And also follow up right, like the art of following up immediately, instantly. Speed is key. So I am pretty much now I used to like until six to nine months ago, I was involved in every single sales call right with every single customer either the, from the first call to the to the last call, right? But now I am less so involved. However, even the ones where I am involved, like I'm following up immediately. Like, I have a one day SLA and I tell my team you have to follow in a one day SLA. Yeah,

Helen 24:24
I guess in the early days, it was to your point about of your authentic self, you weren't a salesperson, but equally, putting yourself in that position allows you to use your background and like machine learning and as scientists to be able to bring that on to what you'd then want is to like put into the product. So it was kind of like sales but also like massive market research like kind of combined. What I guess as well for a startup in the early days. It's probably good to in one or three in one a founder, a salesperson slightly doing market research.

On your point about health like I think that's so import To like, it's just so hard to I guess you must have started this business during the pandemic then or just before it just during the pandemic. Yeah. Wow, that's so impressive. That was literally, actually that's so weird because I feel like time during the pandemic doesn't feel like time as in like 23rd. You know, like 2023 2022, it just feels like one huge block of time.

So you can I can understand how you probably got into that space of like, I'm not, I'm not, I can do these 18 hour days because of just the way Time moved, and maybe like post the pandemic, when things start to get back to normal. You maybe, I mean, I'm just assuming that, I guess you saw how much of the strain that put on you and your family and just everything around you. Let me ask you one more question that founder has asked. This is quite an interesting one. What's one, what's the one FinTech story we haven't seen that we're gonna see in the next 12 months? I

Soups 26:00
think that, I mean, it's not probably 12 months, but longer than 12 months, right. So, you know, it's bits and pieces of it, we already see. So my prediction is that, in the next several years will increasingly see all the faster payment methods worldwide actually getting interconnected. Right. So UPI talking to picks up in India talking to picks in Brazil talking to RTP for now in the US struggling to Faster Payments in the UK. And therefore, you know, the the duopoly of Visa MasterCard on the card network scheme is going to have real competition, right? Because we will have all these interconnected faster payment rails, right. And we already see bits and pieces, they'd like India has already connected in CPI with the faster payment method in Singapore, right. So therefore, you know, Indian expats visiting Singapore or vice versa, they can send money to friends and family across cross border using just those two faster payment periods. Right. So that's my faster

Helen 27:04
payment methods means more fraud. Right? Which means, yeah, which means some more need for Sardine and yeah, I, this is my last question. I'm gonna bring it back to Sardine and actually, why did you specifically decide to solve this problem?

Soups 27:25
Yeah, absolutely. Yeah. So a couple of things. Right. So first, I always wanted to start a company, right. But, you know, for variety of reasons, right? related to not having the right immigration visa in the US for the longest time to start a company. And so today, it all transpired to me starting a company in my 40s, right. And then the second factor was that, you know, my professional career has always been about using machine learning and data to solve any and all nefarious activity, like I have my professional career 18 plus years. And if you in fact, Conway, PhD, five years for 20 plus years, is really, you know, solving for detecting things like cyber threats, detecting denial of service attacks, tracking botnets cyber security threats, in the first five to 10 years of my career. next several years, were fighting ad fraud. And then the last eight years have been all about payment fraud. Right? So therefore, you know, I realised that as we are writing a couple of trend waves, one being embedded finance, second being crypto slash faster payment methods, right? In these trends, right, the older tools to fight fraud, and older tools, which are used to comply to build compliant products, they're not gonna work, right. So we started studying or, you know, our thesis was that, you know, as these new entrepreneurs come on board, and they start building new fintechs, or as the older banks, they have to rebuild their stack so that they can actually support faster payment methods, then in both those cases, they will have to rethink fraud and compliance. Do the banks don't do fraud in real time? Right? They, you know, they, they, they do sorry, I should take that back. They do some of the fraud checks in real time, but most of the other compliance systems are not real time compliance systems at the banks, they don't talk to the product databases, there's no 360 degree overview. So therefore, we saw a big opportunity to actually build fraud and compliance in one singular platform one API from the ground up Yeah, it's

Helen 29:35
interesting. Yeah, cuz that together. I yeah, I guess I was wondering if you had like, if there was like a moment where you were like, This is me, like, this is what I feel like I need to solve. Or maybe there wasn't, yeah,

Soups 29:49
there was yeah, there was actually. So I was going through the idea maze for starting a company four years ago. I had several ideas that I had in mind. ain't right i, the first thing I did was I talked to like, hundreds of people, like friends, friends of friends, friends of friends of friends that literally interviewing them. And there was one advice I got, which was actually from another entrepreneur friend, which is very good, because I was actually debating between one idea, which was, I wanted to see if I could, you know, tokenize real world assets and commodities four years ago, right, which we now see people are trying to do. And the second idea was like, let me go start a fraud prevention company. So this friend of mine was like, super, you should start the fraud prevention company, because there's like a product, there's a founder market fit over there, you really don't know anything about tokenizing assets or don't really know about commodities. So, you know, don't kid yourself go and start a company in fraud prevention. So that was that that was a solid advice, which, which gave me the boost to go start signing Nice.

Helen 30:53
Yeah. I mean, they're both super interesting. Companies. Who knows, maybe, maybe you'll do both. At some point, I guess in terms of like, you know, in the beginning, I said, like, how do you explain it to your non FinTech friends and stuff like that? Sardines. Probably easier to explain. I mean, maybe, yeah, I would say, I guess it has an I guess it has a everyone can can kind of get behind what you're doing. I'm going to ask you like the quickfire questions. So they have nothing to do with fintech. Just tell me like, what comes into your mind?

Signals

Signals is our subscriber only reads, and I'm going to read you a snippet from an article I actually wrote.

As Aristotle once said, "For we are what we repeatedly do. Excellence, then, is not an act but a habit." His words are a potent reminder that our professional responsibilities extend beyond mere tasks; they are an avenue for ethical conduct and societal contributions. This holds especially true for fintech firms, who are uniquely positioned not just as conduits for capital flow but as instruments for social justice and intersectionality.

Today, we are witnesses to an escalating humanitarian crisis. With over 114 million forcibly displaced individuals worldwide, a number that has surged by 4 million since May, collective action that transcends borders and institutions is urgently needed. The UNHCR has declared 46 emergencies across 32 countries in the last year alone, underlining the need for all sectors, including fintech, to take ethical action. Fintech can play an invaluable role, particularly when viewed through an intersectional lens that considers the multifaceted experiences of these individuals.

The term "intersectionality," coined by Kimberlé Crenshaw, isn't merely a trending buzzword. It is a framework through which unique challenges and opportunities at the intersection of fintech and social justice can be understood. Crenshaw urges us to "name the problem to solve it." For refugees and the displaced, the intersectional problem is financial exclusion compounded by a lack of documentation, legal status, and cultural barriers.

. To read the rest of this article, please subscribe to the this week in FinTech newsletter.