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A.I. shop goes from tracing Covid-19 to virtual banking

Sqreem rolls out A.I solution for South Africa’s crisis response that could be repositioned for digital banks.



Ian Chapman-Banks, Sqreem

The government of South Africa is deploying a real-time contact tracing and communication system to deal with Covid-19. The artificial-intelligence company behind it, Singapore-based Sqreem Technologies, intends to reposition it for virtual banks, and is planning to raise a Series B round to fund the expansion.

Ian Chapman-Banks, Sqreem’s co-founder and CEO, says the solution for South Africa is a play on technologies the company has been developing since 2014, when it began selling AML and KYC services to financial institutions.

“I was in 14 days of self-quarantine after a trip to the U.S., and we engineered our Covid-19 platform in that time,” he said.

The solutions the company is offering South Africa are similar in nature to helping a bank root out fraud, or for a wealth manager to source new clients.

Tracing Covid-19

With access to a population’s mobile device metadata (which is public information not involving personal identity information), Sqreem’s software tracks where they go across a grid down to five square kilometers. Anyone entering a given grid has their mobile device’s identity matched to known Covid-19 cases and a probability assigned to the owner coming into contact with infected people.

If the probability is high, the government will get the person’s mobile number from the telecom operator, buy up ad space for that person’s social media usage (including if they run a Google search), and bombard them with SMS and ads imploring them to contact the Ministry of Health. Sqreem also matches the device ID to a phone number so the ministry can call people directly.

A lot of computing power goes into making this possible: more than 10,000 servers on Amazon are harnessed to Sqreem’s A.I. software.

South Africa’s track-and-trace plan also involves using 10,000 health workers to follow primary contacts into their communities and ensure testing for secondary contacts. The government hopes this surveillance will stave off a wave of infections in an emerging market where, despite a recently announced lockdown, social distancing is a luxury most people cannot afford.

Misses and hits in finance

But what Sqreem’s A.I. does for Covid-19 can be repeated for financial services, as well as other industries the company sells to, such as military intelligence, pharmaceuticals and automotive.

“We find the anomalies, identify the positives, make the links,” Chapman-Banks said.

This doesn’t mean financial institutions are rushing to adopt the company’s solutions. Chapman-Banks says its AML service has been a commercial flop. “Banks aren’t ready to implement non-rules-based applications,” he says. “We are a little too far ahead of the market.” Banks prefer software solutions that more obviously check compliance boxes, but that throw up a lot of false positives.

“Maybe in a few years they’ll be ready to come back,” he added, “or we will buy an AML company and plug our platform into it.”

Burgeoning use cases

Sqreem’s A.I. has found favor in marketing departments, however, which are constantly on the search for new customers or helping product teams match an offer to an individual client.

OCBC deploys Sqreem to identify potential SME customers, and Bank of Singapore uses it to find potential high-net-worth clients. HSBC and others are also clients.

The biggest user in financial services, however is Rakuten, the Japanese internet company, which adopts Sqreem’s A.I. to market to its e-commerce clientele and serve them credit-card and digital-banking offers.

“Rakuten is emerging as a leader in using artificial intelligence in financial services,” Chapman-Banks said.

Next: virtual banks

Financial institutions have largely been slow adopters – but this may change. The rollout of the solution to fight Covid-19 is a precursor to a new push to market Sqreem’s A.I. to virtual banks in Asia.

“The biggest opportunity I see is virtual banks, which need most of all to acquire new customers,” Chapman-Banks said. “They need to identify what customers want, construct the product, and hit people with an ad. A digital bank can originate a product and quickly test if it will work for almost zero cost.”

Sqreem is privately funded, and details of its backers are not publicly available. The company was founded in 2006 and began marketing its services in 2014. Chapman-Banks said it has begun a Series B round to raise $70-$90 million “to turbocharge our growth in financial services” and continue expanding in other industries.

The Covid-19 pandemic has clogged up the process. “Things are moving quite slowly, so we’ll keep the round open until the Covid-19 situation quietens,” Chapman-Banks said.

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