My guest today is Neha Narkhede, Co-founder and CEO of Oscilar, which is an AI-powered platform for managing risks, including in fraud and identity.
Financial companies are in the business of managing risk. They make money by skillfully taking risks in areas like credit and markets and pricing those risks to make the gains more than the losses. Given how intensively they are regulated, they must also be adept at managing regulatory risks. And, since their core “product” is money, they have to be especially vigilant about crime risks, from activities like fraud and money laundering,
I think the single most critical ingredient in managing risk – or at least the one that most bedevils financial firms – is information, or more accurately, lack of it. Financial companies need more and better data. It’s basically as simple as that, although, as often happens, simple doesn’t mean easy. Many things are simple, and very difficult.
The great news is, we are fortunate to be living in the age of information! In recent years, all the information around us has been getting converted into digital form, making it accessible and analyzable, in ways that humankind could not even have imagined just a few years ago. And in the last two years, we’ve seen the transformational emergence of generative AI, which is empowering people to use all this information much, much more easily, especially by enabling no-code methods for everyone to use boundless information, for themselves. Gone are the days when risk managers were limited to static, data-poor, out of date summary reports and, if they needed more, to putting in an order to the IT queue for a special analysis. We now have an explosion in access to, and useability, of information. And that, in turn, is the risk manager’s dream.
Most financial companies are at the beginning of the process of making that dream come true. They still have old IT systems, old data stranded in old databases, and clunky tools for accessing and analyzing it all. That’s what Oscilar is trying to solve.
Neha, who previously cofounded Confluent, explains that she chose the name Oscilar because risk management in fraud and money laundering has traditionally oscillated as a choice between either reducing risk by tightening the public’s access to financial services, or expanding access, at the expense of taking on more risk. Oscilar aims to break that cycle, to let businesses serve more people, without more risk, by using more and better information.
And the key to this, she says – and I agree – is to get information out of its silos and into a form where the company can see the whole patterns.
In our conversation, Neha talks about how to protect the privacy and security of shared data, through tools like encryption. She talks about the power of cutting back the rampant false positive problem that plagues the industry today in fraud and AML monitoring – and also doing better on avoiding the false negative situation in which there IS fraud there, and it’s not detected. She talks about which types of fraud are growing fastest, and why.
She also offers thoughts for policymakers and regulators, including homing in on the need for explainability, sharing thoughts on which risks need more emphasis on explainability, and which may not.
Tools like these are the future of risk management and compliance. Everything is changing.
Neha Narkhede is an Indian-American technology entrepreneur, founder & CEO of Oscilar. She also cofounded and was the Chief Technology Officer of Confluent (NASDAQ: CFLT) and serves on its board of directors. As a software engineer at LinkedIn, she helped develop the open source messaging system Apache Kafka now used by more than 90% of the Fortune 500.
In 2014, she co-founded Confluent, which helps organizations process large amounts of data to create transformative real-time products. Neha has been listed as one of America’s Top Self-Made Women by Forbes, Forbes’s Top 50 Women In Tech, MIT Tech Review’s Innovators under 35 and Fast Company’s 100 Most Creative People. She has a Masters in Computer Science degree from Georgia Tech and today advises and invests in numerous technology startups.
More for our Listeners
At AIR, our big news is that we are launching our inaugural conference! It’s called Converge: Creating the Future of Financial Regulation. It will be on September 16 in Washington D.C. at the Hamilton Hotel, and it will be unique. The financial industry and, therefore, financial regulation, are at a pivot point that’s being driven by two things: new technology and, in the United States, the tremendous changes being made by the new administration and Congress. AIR is gathering the most thoughtful people in the financial world to, together, think through the big issues, the ones that will change everything. Please plan to join us!
These same currents of change are also shaping the podcast show. We’re going to have two of the U.S. agency heads in the new Trump Administration – Acting Comptroller of the Currency Rodney Hood and NCUA Chairman Kyle Hauptman – on the show soon. We’ll talk with Saket Narayan of AWS, discussing modern technology applications needed by regulators. We have a fascinating discussion with Aishah Ahmad on payments fraud in West Africa. We’re going to have visionary innovator Greg Kidd back on the show. We’re also going to have a special show with a medical expert, talking with us about how the U.S. regulates medical innovation, and potential lessons for the financial world. And much more.
We are also very busy with upcoming events. On April 17th I will participate in a panel at George Mason University exploring how to modernize financial regulation and create economic stability in the digital age. In May you can find me at the Mortgage Policy Summit hosted by CSBS and AARMR in Washington, DC. I’m also speaking at the upcoming summit of the National Fair Housing Alliance. My colleagues in the UK and South Africa will be speaking at several Africa events in the coming months. Check out our lineup at our website, and also be sure you’re up on our white papers, including the new one on earned wage access.
