Alex: Hey everybody and welcome to another episode of The Curiosity Code podcast. Today, we're doing an in-person recording in New York City, and I’m excited to have Arcady Lapiro with us. Arcady is a true innovator in the fintech world, with over 25 years of experience in banking, financial technology, and venture capital. He is the CEO and founder of Agora Financial Technologies, a company focused on providing next-generation banking solutions to community banks and credit unions. Arcady, welcome to the show!

Arcady: Thanks, Alex, for having me on your podcast. It’s great to be here in New York. Live from New York—but not on a Saturday! So, as you mentioned, I’m the CEO and founder of Agora Financial Technologies. We are a US-based fintech company, and we operate as both an embedded fintech player and a bank-as-a-service provider. Our goal is to create a complete platform that powers any bank.

Alex: So Agora enables banks, credit unions, and fintechs to launch standalone financial services or even completely new digital banks?

Arcady: Exactly. We provide everything from A to Z. We have a banking sponsor partner, a Visa partnership, and the full front-end solution. Our platform allows institutions to roll out financial products without the need to build everything from scratch.

Alex: That’s great. As I understand it, your business model is modular, meaning it doesn’t require banks to change their core systems. How did you arrive at that approach, and what unique challenges does it solve?

Arcady: That’s a great question. I’ve been in this industry for over 25 years, so I’ve seen both the old and the new worlds of banking technology. Back in 2000, I was part of the founding and management team of a digital bank in Europe. At that time, we had to work with legacy technology providers, and we ended up building layers on top of their systems just to function.

Arcady: When I moved to New York 14 years ago, I worked as a consultant and advisor to many banks and VCs in fintech. I quickly realized that even after 24 years, banks were still struggling with the exact same issues I had faced in 2000. Banks that wanted to launch a new product were stuck relying on the same outdated technology providers—some of whom still run on COBOL, a programming language from 40 years ago.

Arcady: The issue is that these legacy providers control the market, and whenever a bank wants to innovate, they have to go through these big players, who make changes complicated, expensive, and slow. So we developed the concept of modular banking. Instead of trying to replace the entire core system, we deconstruct banking infrastructure into microservices, making it easier to build, scale, and integrate new financial products.

Alex: That makes a lot of sense. So essentially, you’ve broken down core banking into individual building blocks that banks can mix and match based on their needs?

Arcady: Exactly. Think of it like LEGO bricks. If a bank needs a specific function—say, KYC (Know Your Customer) or digital onboarding—they can just plug in our API instead of going through a lengthy, complex integration process. We allow them to either work in parallel with their existing core banking system or integrate directly via API. It’s a much more flexible and scalable approach.

Alex: That’s fascinating. How quickly can a financial institution go live using your modular banking approach?

Arcady: It depends on the scope of the project. If a client just needs to integrate a standalone feature, like digital identity verification, it can be up and running in a matter of weeks. If they want to launch an entire digital banking platform, including compliance and product setup, the timeline typically ranges from two to three months. The key here is that the technical implementation is fast because the infrastructure is already built—all we need to do is configure it to match the client’s requirements.

Alex: That’s impressive. So how do you handle compliance? Banks are heavily regulated, and compliance is often a major roadblock for innovation in fintech.

Arcady: That’s a critical point. I used to be a head of compliance, overseeing $65 billion in assets, so compliance is deeply embedded in how we operate. However, we don’t handle compliance for our clients—we provide them with compliance tools, but the responsibility remains with the bank or fintech using our platform. This ensures that they remain in control of their regulatory obligations.

Arcady: Some of my competitors made the mistake of trying to manage compliance on behalf of their clients, which regulators quickly shut down. At Agora, we integrate with the best compliance providers, offering KYC, AML, and fraud prevention solutions as part of our ecosystem. But ultimately, compliance remains the responsibility of the financial institution using our platform.

Alex: That’s a smart approach. Now, let’s shift gears a bit and talk about AI. It’s been dominating the conversation in fintech lately. You’ve worked with AI-driven companies before—what’s your take on the role of AI in banking?

Arcady: AI is transforming banking, but we’re still in the early stages. AI in banking is not new—back in 2005, I worked with one of the largest credit unions in France that partnered with IBM Watson for AI-driven customer service automation. What’s new today is the explosion of AI capabilities, funding, and open-source models.

Arcady: That being said, banks are traditionally slow to adopt new technologies. Right now, AI in banking is mainly focused on efficiency, customer engagement, fraud detection, and compliance automation. Banks are cautious when rolling out AI-driven products because they fear the consequences of errors. That’s why AI adoption in banking will happen in phases—starting with backend processes before expanding into customer-facing applications.

Alex: That’s a great perspective. How is Agora incorporating AI into its platform?

Arcady: We’ve already deployed AI in several key areas. We use AI for fraud detection, AML compliance, QA testing, and even automated card transaction monitoring. AI helps us detect anomalies in transactions—say, if a customer who typically spends $1,000 a month suddenly makes a $10,000 transaction from a foreign country, AI flags it for review.

Arcady: We also use AI to compare customer behavior against peer groups, allowing us to detect suspicious activity more effectively. The difference between AI-driven fraud detection today and traditional methods from years ago is that AI can continuously learn and improve, making it far more effective at identifying risks in real time.

Alex: That’s fascinating. AI’s ability to continuously learn and adapt is what makes it so powerful. But do you think we’ll ever see a fully AI-powered bank?

Arcady: Technically speaking, it’s already possible to build a 100% AI-powered bank. But whether customers are ready for that is a different story. People still want some level of human interaction, especially when it comes to managing their money. Even tech-savvy users often prefer speaking to a live agent rather than dealing with an AI chatbot for complex issues.

Alex: That makes sense. Customer trust is a big factor in financial services.

Alex: So while AI is making processes more efficient, there’s still a trust barrier when it comes to fully AI-driven banking. What do you think will be the next major breakthrough for AI in financial services?

Arcady: I think the biggest impact will come from AI-powered automation in compliance and fraud detection. Banks and fintechs are under constant regulatory pressure, and AI can dramatically reduce compliance costs by automating processes like KYC, AML, and transaction monitoring.

Arcady: Another area where AI will be transformative is product personalization. Right now, financial services are still largely one-size-fits-all. AI has the potential to create hyper-personalized banking experiences, recommending financial products, credit limits, and investment strategies based on real-time data analysis. Instead of generic offerings, users will receive financial solutions tailored to their specific behaviors and needs.

Alex: That’s really interesting. Let’s switch gears to fintech startups and venture capital. You’ve been deeply involved in the VC space—how do you see the fintech investment landscape evolving?

Arcady: The fintech investment landscape has gone through cycles. A few years ago, the buzzword was crypto—if you wanted to raise money, you needed to mention blockchain in your pitch deck. Then came AI, and suddenly every startup was positioning itself as an AI company. While AI is undeniably transformative, the real opportunity lies in embedded finance and fintech infrastructure.

Arcady: I believe the next wave of fintech investment will focus on embedded financial services—integrating payments, lending, and wealth management directly into non-financial platforms. Companies that provide the infrastructure for this transformation, rather than just consumer-facing fintech apps, will attract the most funding.

Alex: That’s a great insight. Given the current economic climate, do you see fintech funding rebounding?

Arcady: Yes, I think we’re already seeing a shift. The market slowed down over the past two years, but now there’s a lot of dry powder—VCs have capital they need to deploy. The next wave of fintech funding will be focused on more mature companies, Series C and beyond, rather than early-stage startups. However, I do think that as interest rates come down, we’ll see renewed investment in seed and early-stage fintechs as well.

Alex: That makes sense. For fintech founders listening to this, what advice would you give them on building a successful company in today’s environment?

Arcady: First, if you’re in B2C fintech, you need a highly differentiated product—something niche and proprietary. Competing head-to-head with big banks in retail banking is nearly impossible unless you have a truly unique angle.

Arcady: For B2B fintechs, my advice is to focus on partnerships rather than direct competition. Instead of trying to replace banks, think about how you can provide them with better technology, compliance tools, or infrastructure. There are over 10,000 community banks and credit unions in the U.S. alone that need fintech solutions but don’t have the resources to build them in-house. That’s a massive opportunity.

Alex: That’s great advice. Now, let’s talk about embedded finance. This space is growing rapidly, and we’re seeing financial tools integrated into all kinds of platforms. How do you see embedded finance shaping the future?

Arcady: Embedded finance is already transforming the industry. Ten years ago, if you wanted to offer financial services, you had to be a bank or partner with a bank. Today, with APIs and banking-as-a-service platforms like ours, any company can embed financial services directly into their products.

Arcady: We’re seeing this in e-commerce, SaaS platforms, even social media. Twitter (now X) is launching its own financial services. That’s a huge shift because it means traditional banks are no longer the only players in financial services. Embedded finance is allowing companies with large user bases to become financial service providers themselves.

Alex: That’s an exciting shift. But doesn’t that create challenges for traditional banks?

Arcady: Absolutely. Traditional banks are slow-moving, heavily regulated, and still rely on outdated technology. Meanwhile, tech companies are embedding finance seamlessly into their platforms. Banks have two choices: either adapt and embrace embedded finance, or risk becoming irrelevant.

Arcady: Some banks are starting to partner with fintechs rather than compete with them. I think we’ll see more of that in the future. The banks that survive will be the ones that collaborate with fintechs to offer better, more integrated financial experiences.

Alex: That’s a great point. Now, let’s talk about compliance. You’ve worked on both the regulatory and innovation sides of fintech. How do you balance the need for compliance with the push for innovation?

Arcady: Compliance is non-negotiable, but it shouldn’t be a blocker for innovation. The key is to integrate compliance into the product development process from the start rather than treating it as an afterthought.

Arcady: One of the biggest mistakes fintechs make is underestimating compliance. Many founders come from sales or tech backgrounds rather than banking, so they don’t always realize how complex regulatory requirements can be. We’ve seen fintechs market themselves as “FDIC-insured” when they’re not—the bank holding the deposits is FDIC-insured, but the fintech itself isn’t. Regulators are cracking down on these kinds of misrepresentations.

Alex: That’s an important distinction. How does Agora approach compliance?

Arcady: At Agora, we take compliance very seriously, but we don’t manage it for our clients. We provide compliance tools—KYC, AML, fraud prevention—but ultimately, compliance responsibility lies with the bank or fintech using our platform.

Arcady: We also make sure our platform is designed to work seamlessly with compliance processes. We use AI-driven fraud detection, automated AML checks, and real-time transaction monitoring. These tools help our clients meet regulatory requirements without slowing down innovation.

Alex: That makes a lot of sense. Looking ahead, where do you see fintech and banking heading in the next five to ten years?

Arcady: Fintech is here to stay, and it’s only going to grow. But I think we’ll see a shift from mass-market consumer fintechs to more niche financial services and infrastructure players.

Arcady: In the U.S., I expect more niche banking solutions tailored to specific customer segments. On the B2B side, fintech infrastructure will continue to expand, with more companies focusing on modular, embedded finance solutions.

Arcady: Globally, fintech growth will depend on regulation. Europe is leading in open banking, while the U.S. is slower to adopt those models. In emerging markets, fintech will continue to drive financial inclusion, especially in areas where traditional banking is underdeveloped.

Alex: And how is Agora positioning itself for this future?

Arcady: We’re well-positioned because we provide fintech infrastructure rather than just consumer-facing services. Our modular banking platform allows any bank, credit union, or fintech to build and scale financial products quickly. We’re focused on enabling financial institutions to modernize without the cost and complexity of a full system overhaul.

Alex: That’s a strong position to be in. Arcady, this has been an incredible conversation. Thanks so much for sharing your insights!

Arcady: Thank you, Alex. It’s been great to be here.

Alex: And to our listeners, thanks for tuning in! Don’t forget to subscribe and share this episode. See you next time!