Symmetrical Manifesto — how programmatic architecture for financial services is going to redesign the industry?

Piotr Smolen
Jun 18, 2018 · 13 min read is a fintech company bringing financial power back to the people. It is powered by Credit Cloud technology, which creates a new, programmatic model of value creation for the banking industry. It is inspired by a Real Time Bidding platforms which have dominated online advertising in recent years. It is powered by an idea of making the financial market more symmetrical in order to empower both: capital providers and consumers by liberating their data. The goal is to fully eliminate current system inefficiencies, drive the transaction cost to nearly zero and as a result redistribute the value back to the end-customers and original capital providers.

In the following article, we want to explain the direction of the business model evolution in the global economy and deliver reasoning as to why the financial industry hasn’t been touched by disruptive innovation, yet! Further on, we are going to introduce and explain how Fintech 2.0. startups will operate in the future. Finally, we are going to introduce the vision, economics, and construction of the platform.


The Financial Services industry hasn’t changed much in the last 100 years. Over and over again, banks and insurers are selling the same, homogenous products based on a basic exchange of cash flows. The only innovation which has happened in the finance industry has just touched distribution channels and user interfaces (mobile, web) or financial engineering. We have not experienced real, disruptive innovation within the industry nor has value proposition to the clients improved much. Arguably all the fintech buzz we see around (the rise of Revolut, neobanks, innovative payment companies) is based on superior user interfaces which do not fit the bill for making a dent in the reality. From the operational perspective, some of the processes were made more efficient in terms of processing time (specialization, centralization, automation, digitization) still, there has been no fundamental revolution that has affected the backbone of the operating model of the financial institutions.

Picture: business model evolution

If we observe carefully the economic reality, we see a repetitive pattern. In the last 20 years, most industries have been touched by the virus of disruptive innovation bringing huge fundamental changes into reality. This business model evolution is built on the following patterns:

  1. Elimination of middlemen — many of the next generation startups try to disintermediate the middleman/ aggregator and share the savings in the profit pool between other participants in the value chain.
  2. Liberation of data — the destruction of data silos stands is crucial to building a new value proposition for the users.
  3. Empowerment of users — as a result, more and more end-users benefit from the process of making the value chain shorter and more transparent, thus price to quality ratio of products and services increases.


  • Uber — disrupted inefficient middleman (the taxi corporation) by liberation of data about people with a need to ride and drivers owning cars, delivering cheaper services to the clients and larger profits to the drivers.
  • Airbnb — disrupted inefficient middleman (the hotel owner) by liberation of data about people with a need for renting a room and the owners of the apartments, delivering cheaper services to the clients and allowing monetization of unused assets for the real estate owners.
  • Google — disrupted inefficient middleman (the advertising agency) by liberation of data about people searching for quality information and businesses offering relevant products/ services, delivering free information relevance discovery to the clients and larger and more precise returns on marketing spend for the business owners.

The big question is: why have financial institutions not been disrupted yet?

Moats around financial strongholds

Against all the economic rules, financial institutions are able to create huge economic rent selling a bunch of logically simple, homogenous products, thus earning oligopoly premium within markets which should operate in line with the perfect competition paradigm.

Their strategy is based on creating and keeping information asymmetry within the financial services industry while at the same time increasing barriers for entrance to the market. This advantage is cemented by a wrong regulatory incentivization model in which the management of financial institutions is responsible for the numerous financial crises, ultimately leading to more strict regulatory frameworks. Also, the competitive advantage of incumbents has increased allowing financial institutions to better control the value chain. End customers and investors are the clear losers of the recent history of the financial industry, the winners are the centralized organizations and (especially!) their management.

Diving deeper into the pillars of financial institutions’ competitive positioning, the main drivers of value creation for them are client data silos, trust infrastructure, risk pricing, user interfaces and access to capital.

Picture: value creation layers of a financial institution’s business model
  1. Client data silos — all of the financial industry players try to restrict client data sharing in order to build information advantage over competitors. They try to build intransparent product structures and pricing to create information asymmetry and incomparability of the products.
  2. Trust infrastructure — similarly to telco operators who operate infrastructures used for transferring information between final users, financial institutions use licenses, legal requirements, compliance teams, and IT systems as an infrastructure for transferring value between final users.
  3. Risk pricing — the ability to manage risk and offer competitive pricing for the financial product as a result of the analytics of a risk profile.
  4. User interfaces — thanks to the control of the bank account creation process, financial institutions have almost monopolized access to the transactional user interface for buying financial services.
  5. Access to capital — financial services companies possess unique access to capital providers (especially banks which may leverage on central bank capital)

These five factors gathered together allow banks and insurance companies to operate in asymmetric markets and earn economic rent at supposedly perfectly competitive markets.

Perfect Storm. It is now or never!

A perfect storm is an event in which a rare combination of circumstances drastically aggravates the event. The term is used by an analogy to an unusually severe storm that results from a rare combination of meteorological phenomena. The perfect storm for the financial industry has just started!

Picture: perfect storm main drivers

Our thesis is that all five pillars of competitive positioning for the financial institutions are on fire and it will lead to a rapid unbundling of financial services business models.

Table: vectors of disruption in financial services

Up until today, the main focus of the finance industry was on the so-called “unbundling” of financial product lines which mean new specialized startups offering a chosen service at a better level than an original financial institutions (horizontal unbundling). The real disruption though lays in vertical unbundling of trust infrastructure, data silos, risk management, UX and access to capital layer! We expect a new generation of disruptive, vertically oriented and fast-moving startups to pop up on the landscape to create a new wave we call “Fintech 2.0”.

Towards Fintech 2.0. What would it be?

In all likelihood, the best times for Fintechs 2.0 are yet to come. They will attack the core business model of financial institutions, changing the game on the way.

Picture: horizontal/vertical unbundling of financial services

The new revolution will be based on vertical unbundling (opposite to horizontal unbundling) of financial services business models, including:

- destruction of data silos within banks and radical reduction of information asymmetry within the industry

- commoditization of the regulatory infrastructure by so-called API banks

- disintermediation of banks as intermediaries (separated front ends, stand-alone risk engines receiving capital directly from investors, stand-alone servicing companies etc.)

- an explosion of companies starting to compete in almost all business segments, entering financial services from other verticals that will lead to a rapid erosion of margins within the industry

- introduction of real-time bidding markets for financial services in which clients will receive optimal product pricing for its risk regardless of distribution costs or operational inefficiencies at the moment of buying a financial product. The competition will be based on the quality of risk management engines managed by financial institutions, hedge funds, etc.

- increased competition among the regulatory bodies which understand that in order to secure long term position they need to attract global challengers right now.

Those trends will allow the creation of a perfectly liquid and instant lending market.

Picture: segmented vs liquid lending markets

As a result, the average returns for investors would be increased and the average cost of capital for lenders would be decreased on a global level.

New Financial Services Architecture

Nowadays, practically all meaningful market players world-wide are monoliths that are struggling with adopting new market trends as well as cooperating with value-adding partners. Following a simple IT pattern — evolution of microservices in place of monoliths — Financial Institutions market architecture is going to be redefined in the same manner.

Picture: Microservice architecture of financial services

The new architecture will be composed of specialized “microservice-like” businesses with world-wide ambitions. The scale will be the ultimate objective, but not to justify “too big to fail” institutions rather as a must-have to offer minimal transaction costs. Globally number of meaningful market participants will decrease still, thanks to low barriers of entry and minimal switching costs the system will eliminate inefficient and/or outdated players with new, more efficient, ones.

This trend will enable higher market stability globally, as the market situation will be an outcome of millions of educated mini decisions instead of a lagged decision of a few isolated groups of individuals with limited access to real market data. It is in line with the interest of regulators, who will focus primarily on the elimination of systemic risks thus making sure that the industry stays as close as possible to perfect competition.

Picture: the programmatic architecture of financial services

In practice the New Financial Services Architecture will work as follows:

  1. There will be three types of actors on the market:
  • DSA (demand side actors) — providers of data and user interface / user experience, e.g. fintechs like Revolut, Tide, N26
  • SSA (supply side actors) — providers of capital, e.g. investment funds, hedge funds, insurance companies, individual investors
  • Specialised platform businesses that will allow for the monetization of one’s assets through clearly defined VAS and data enhancements

2. There will be a lean technology platform connecting capital with final users which will work in a perfectly competitive and transparent real-time bidding model.

3. All financial products would be standardized into a set of parametres (cash outflows and inflows); new data sets can originate a new product or value-added service.

4. The platform will be operating 10x more efficiently than centralized financial institutions while operating at a fraction of the costs (no administrative, sales, marketing, general costs etc.). As a result, a Capital-as-a-Service model will be created.

Picture: the programmatic model of buying a financial service

5. The process of buying financial services will work as follows:

  • DSA aggregates data sets of end-customers and introduces them to the ecosystem (interface between end-customer and the ecosystem); from the transaction standpoint DSA originates a contract with the customer which is then instantly transferred to SSA
  • The Platform provides the best offer of choice (pricing) for the given need (acting as a marketplace) and makes sure (transaction engine) that the actual contract is binding (i.e. fully covered by SSA)
  • SSA aggregates capital providers and takes on the risk exposure to its books
  • The binding contract is fully transferable and divisible, which means that the SSA can act as both the ultimate risk bearer and as an arbitrageur

6. From the perspective of the end-client the process will work as follows:

  • Any time an end-client would like to buy a new financial product (credit, lease, factoring, insurance) he would be put on the real-time bidding exchange and will be offered the lowest possible price for his risk profile. As a result, he would not optimize for better pricing as the best possible product will be accessible directly within the user interface of the trusted service provider.
  • Any time the new data set which might possibly increase the scoring of the end-user enters the Symmetrical platform, the currently active products will be put on the real-time bidding exchange because there might be an SSA who might refinance the product and offer more competitive pricing for the user. As a result, he knows that as long as he is on the platform, he has the best possible pricing.
  • The contract for the product will be signed and serviced by the provider of the user interface. Capital allocation will be executed in the backend.

The new financial services infrastructure we are envisioning will be symmetrical, transparent and programmable, providing tremendous value for capital providers and borrowers by liberating their data. The value will be generated thanks to a full and truly global diversification where the costs are driven down to an absolute minimum (sustaining the IT infrastructure). will be the first company on the market that will deploy the new financial services architecture.

It will be in line with the business model evolution trends:

  1. Eliminating middlemen — RTB models in the financial industry might eliminate the traditional business model of the integrated financial institution forcing it to specialize or to leave the market as an inefficient middleman.
  2. Liberating data — RTB model will liberate the data needed to create a credit score for a client and will transfer the control over the data to the end-user as a result, it will allow perfectly customized pricing of all of the financial products globally.
  3. Empowering of users — RTB model should create a tremendous amount of value for both the capital owners and the borrowers Marketplace Construction

Our platform was launched as a Salary Finance platform targeting low-income workers. Our goal is to build a new gateway for those people to interact with the financial market in a programmatic model. At the moment the platform is designed as an off-chain solution to get initial traction. Soon we will move into the permissioned ledger model. In the future, the market might be launched on permissionless ledger.

Data: Customer data providers (DSA Engine Operators) stake data and make it available to SSA Engines (Model Operators). Transactional data and credit risk history are stored on a public ledger and available freely to all of the Marketplace Participants.

Model building: SSA Engine Operators choose what data to use and create models. Training is done using a secure computation method. Models are staked as well.

Metamodel building: A machine learning metamodel is created based on an algorithm that monitors the marketplace interactions. The metamodel is used to supervise transactional activities, eliminate fraud and bad actors, optimize UX for end-users.

Real-Time Bidding Engine: a series of smart contracts used by competing models that trade programmatically through exchange mechanisms. Financial products will be standardized and constructed based on generic financial product Symmetrical Protocol. All of the financial products on the marketplace will be micro-securitised and available for secondary market trading.

Distributing gains/losses: After some time period passes, investing in credit exposure produces a profit or loss. This profit or loss is divided up amongst investors to the SSA Model based on how much smarter they made it. Models that contributed negatively will lose capital allocation.

Hosting: Data and models are either hosted with nodes in a secure multiparty computation network.

What makes the Symmetrical system powerful?

Incentives to attract the best data globally: Our system will incentivize end-users and DSA Operators to share their data to achieve better pricing and returns, in the long run, free and accessible to all data will make the financial services industry more efficient.

Competition between algorithms: It creates open competition between models/algorithms in places where it previously didn’t exist.

Transparency in rewards: Data and model providers can see they are getting the fair value of what they’ve submitted since all computation is verifiable, making them far more likely to participate.

Real-Time automation: Taking action on-chain and generating value directly in micro securitized tokens will make it easier than ever to manage and transfer risk in a transparent way.

Network effects: Multi-sided network effects from users, data providers, and data scientists make the system self-reinforcing. The better it performs, the more capital it attracts, which means more potential payouts, which attracts more data providers and data scientists, who make the system smarter, which in turn attracts more capital, and back around again.


Financial Industry hasn’t been touched by the virus of disruptive innovation. The market evolution towards the optimal and stable “internet like” ecosystem of the Financial Industry will take at least 5–15 years, still as in most industries and especially for platform-wise solutions the highest chances for success are for 1–3 first market players. Secondly, due to so many market inefficiencies now, the first players are in a position to generate above-market returns while offering the best choice of products for both capital providers and end customers.

Our vision for is to become the first stone thrown in a new Fintech 2.0 wave of startups which will truly disrupt the Financial System of the future. The creation of Fintech 2.0 will also stand for a long tail/ black swan event for traditional banks and insurance companies. They will be forced to redefine their business models and roles in the economy.

Our dream is to create a new just, transparent and efficient architecture of financial industry allowing customers to get access to cheap, ethical lending worldwide and on the other hand enabling investors to allocate capital on the efficient frontier with practically no transaction costs (similar to the Markovitz model in the capital market industry).

It’s not unreasonable to imagine the Future Financial Industry to evolve in the following direction:

Table: implications of the revolution

If you are a potential partner, investor, co-worker or just an enthusiast, we invite you to support us and eventually join us!


Piotr Smolen, CFA

CEO & Co-Founder of

In the past founded and served for over 5 years as CEO at Turbine Analytics — a next-generation investment information processing company based in Warsaw, Poland. The company achieved the position of the leading SaaS software provider for investment funds and capital markets in CEE. Sold to a strategic investor (ProService Finteco) in a transaction financed by a global private equity fund Oaktree Capital Management.




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