By Anna Irrera
NEW YORK (Reuters) - Goldman Sachs Group Inc (N:GS), JP Morgan Chase & Co (N:JPM), Citigroup Inc (N:C) and Credit Suisse Group AG (S:CSGN) have invested $17.5 million in AccessFintech, a startup that sells technology to help financial firms better handle business errors, the companies said on Thursday.
Israel-based AccessFintech has created a network that aggregates and helps resolve so-called business "exceptions", or errors that financial institutions make when carrying out business activities and that require interventions to be resolved.
In capital markets, these errors may include data discrepancies between counterparties on the financial terms of a trade or wrong information used to identify a client. Once spotted the errors are normally handled manually, via numerous phone calls and emails between various firms.
AccessFintech's technology will help reduce the time and resources needed to resolve these issues by helping financial institutions communicate with each other. It will also reduce the risks associated with the errors.
Large banks have become more open to collaborating with each other and with young financial technology startups on areas that do not give them an edge over rivals.
"We see a dramatic level of difference as to what banks are willing to collaborate on, or outsource to shared vendors instead of building internally," Roy Saadon, founder and chief executive of AccessFintech, said in an interview. "We see the banks in a search for efficiency in the places where things are not competitive." Saadon was one of the co-founders of market infrastructure provider Traiana.
All four banks have been working with AccessFintech over the past year, individually and as a group, the companies said. AccessFintech's customers also include asset managers, custodians and fund administrators.
"Once we understood the impact on the operational model of the financial participants it was a quick decision to provide the financial backing," Ana Capella, head of strategic investments at JPMorgan, said in a statement.
AccessFintech, which also has offices in London and other financial centers, will use the funding to grow its business, accelerating efforts including in sales and client coverage, Saadon said.