Finance Derivative Magazine Issue 7

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Mehtab Chisti

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FROM THE CEO

Greetings from Finance Derivative and A very warm Welcome to all our readers.

We thank you all the Outstanding and young supporters who keep us inspired to bring this edition to you each time. The engaging content for the year 2023 we bring a lot of exciting topics covering the Quantitative Trading and AI, Chatbots and Embedded finance.

Let’s find out how can we invest Like a Pro: If you want to build wealth and secure your financial future, investing your money can be a wise decision. It can be difficult to know where to begin with so many investment options available.

Nick Corrigan explains us how payments technology will boost businesses future. 2023 is seeing the physical and digital spaces complete their merger into omnichannel, meaning that consumers will cease to view the virtual and physical worlds as separate, but rather two spaces that flow seamlessly between one another. This marks a huge opportunity for many companies to capitalise upon.

Hope you will enjoy reading this issue of Finance Derivative.

Wishing you all great business and success.

Enjoy!

Mehtab Chisti CEO

CONTENTS

TECHNOLOGY:

12. Are you ready to harness ESG data?

16. Using data is key for lenders to make informed decisions and navigate a perfect storm

42. Investing in software - How to use data around open source projects

54. Intelligence-on-Tap: ChatGPT’s Promise

64. Banking on the ChatGPT craze

SPECIAL FEATURES:

28. The Underdog to Top Dog Mentality

48. Finance Derivative || Global Award Winners 2023

FINANCE:

8. Boosting Employee Engagement within Finance Teams in Five Simple Steps

20. Scaling a Business needs Finance Agility and Efficiency

24. Fintech apps are continuing to grow in popularity: here’s how you can benefit

38. A Digital and Automated Approach to Annual Budgeting is a No Brainer

44. Balancing data security and customer service in financial services

76. Why Organisational Alignment Is Key to Achieving Personalisation Maturity in Financial Services

BUSINESS:

34. How to find an investor that matches your business values

56. Enabling Business: How Payments Technology will Boost Businesses’ Futures

70. Do business plans even matter in turbulent economic times?

74. Hiring and growing in an uncertain market

BANKING:

46. It’s time to transform corporate banking, and the answer is embedded finance

58. How financial services can fortify digital banking with identity security

62. Improving consumers’ financial health through building awareness and trust in open banking

72. A Golden Record and a Personalised Banking Experience

WEALTH MANAGEMENT:

6. Invest Like a Pro: A Comprehensive Guide to Smart Investing

22. Which Cloud architecture model is best for Insurtech?

26. Bringing VCs into the 21st century: with transparency at the top of the agenda, investors need to stay ahead to survive

36. Maximising investments; minimising fees

66. Top 5 AI Use Cases for Quantitative Trading

Invest Like a Pro:

A Comprehensive Guide to Smart Investing

- Deepak Shukla , Founder and CEO of Pearl Lemon

If you want to build wealth and secure your financial future, investing your money can be a wise decision. It can be difficult to know where to begin with so many investment options available. You need to do extensive research and carefully consider your options if you want to make wise investments. Here are some pointers to assist you in making wise investment decisions:

Outline your investment objectives clearly

Determine your goals before you get started. Do you intend to make retirement savings? acquiring a home? Do you encourage your kids to go to school? You can decide how much money you need to invest and what types of investments are best for your needs once you have a clear understanding of your goals.

Conduct research

Before investing in any business or asset, it's crucial to be aware of the risks and potential rewards. To gauge the company's prospects, review the financial statements, read news articles, analyst reports, talk to other investors, and read news articles. This can be used to guide your decision regarding the best investments for you.

Create a diversified investment portfolio

Doing so will help you lower your risk. You can lessen the effect of any one investment on your portfolio as a whole by distributing your funds among various asset classes, such as stocks, bonds, and real estate. This can shield your funds from market turbulence and recessions.

Maintain discipline

Investing can be an emotional rollercoaster because of the volatile nature of the markets and investors' propensity to react to recent news or events. Exercise restraint and adhere to your investment strategy if you want to make wise investments. Instead of reacting emotionally to market changes, focus on your longterm objectives.

Invest for the long term

Investing is a long-term strategy. Even though it might be tempting to try to time the market or focus only on short-term gains, doing so rarely results in long-term gains.

Reduce the cost of fees

Due to investment fees, your returns might gradually decline over time. Before using any investment services or products, make sure you are aware of the associated fees. Then, look for ways to reduce these costs whenever possible. If you want to maintain low fees while still achieving broad diversification, take into account low-cost index funds or exchange-traded funds (ETFs).

Take into account your risk tolerance

Different investment types come with different levels of risk. Bonds typically offer lower returns but are more stable than stocks, which can be erratic and subject to large price swings. When selecting investments, take your risk tolerance into account. Stocks may be a wise investment if you don't mind taking on some risk and have a long time horizon. Bonds or real estate might be a better fit for you if you're more risk-averse.

To sum up, making wise investments requires discipline and effort but can be profitable in the long run. You can build a solid investment portfolio that will assist you in reaching your financial objectives by setting clear goals, diversifying your portfolio, doing research, taking your risk tolerance into account, investing for the long term, reducing fees, and practicing discipline.

Boosting Employee Engagement within Finance Teams in Five Simple Steps

Following the Great Resignation, when a record number of people left their jobs to find more fulfilling roles, businesses still face ongoing challenges with employee engagement. Most notable is ‘quiet quitting’, where employees simply perform their absolute base-line duties with no motivation to go above and beyond – and are still likely to leave in the long term. There is clearly still a pressing need to boost engagement with employees. Happier teams mean greater benefits for the business, with research showing that the most engaged teams create higher profitability, sales and productivity than their less-engaged counterparts.

Finance teams are critical to business success – in particular the accounts receivable (AR) team who keep AR processes operating smoothly and ensure the company receives what it’s owed. Low engagement levels here could mean reduced productivity, meaning invoices take longer to process and follow up; reduced accuracy, meaning records may be inaccurate and finances harder to forecast; and ultimately less care paid to what is often the frontline of customer relations.

By boosting employee engagement, AR functions can help set enterprises up for success. This piece shares five key areas that will help organisations boost employee engagement within their finance team.

Starting with the basics

A good place to start when addressing employee engagement is ensuring good communication with management. AR staff are faced with a myriad of tasks on a daily basis including maintaining accurate financial data and running the cash application process. Their job is only

made harder if they lack the tools they need to carry out their duties, or the training to complete tasks accurately.

If AR team members feel they can open up to management when needed - for instance when they feel they’re overloaded with work, or need help prioritising their time, they in turn will feel heard and supported. A team that speaks up when it has too much on its plate, and delegates when required, is one that is freeing up its own time. In turn, this frees up the AR department to address more meaningful and satisfying opportunities such as improving customer relationships or providing more strategic value to the organisation. But it all starts with knowing their voices can and will be heard by their superiors.

Performance recognition

Internal praise is powerful within businesses as it shows staff they belong and are appreciated.

Benefits of praise

such as encouraging collaboration, clarifying organisational goals, reinforcing employee purpose, and improving quality are all key to ensuring the success of the company, especially during the current economic climate. A recent report highlights ‘performance coaching’, whereby performance is reviewed weekly, as a strategy to boost employee engagement by assisting development and offering additional training where skills gaps exist.

In AR teams, this can be applied in many ways. One example is CFOs mentioning top performers on company calls, or offering incentives to motivate staff. A recent report highlights that 69% of employees planning to quit their jobs said that receiving recognition and rewards would cause them to stay in their current position. Performance recognition motivates staff to both work hard independently, and pull together to achieve results.

Feedback culture

Employee recognition should form part of a broader focus on creating a feedback culture. This encompasses managers asking themselves whether employees feel their opinions are listened to and valued, as well as if they’re receiving regular input on their progress. This includes asking questions like: do your finance teams speak up when they are struggling with their workload, or feel they have too many invoices to process and not enough time to finish them all? Research has revealed that organisations investing in regular employee feedback have almost 15% lower turnover rates, and teams are five times more likely to report increased productivity. Both these outcomes

have a transformative impact on performance and company success.

Adopting agile practices

Companies who adopt agile practices deliver work in small, but consumable increments without compromising quality. For example, sprint planning in AR teams: using daily meetings to report on progress and share any areas that are limiting staff from achieving their goals. This could include discussing concerns like manual data entry prohibiting teams from doing more engaging and meaningful work. Similarly, sprint reviews can provide the same feedback from the opposite direction: regularly reporting on results within projects and discussing changes that should be implemented in the next sprint.

Achieving team consensus on suggested approaches is an effective way to empower employees. Silos are eliminated and the collective brainpower of the team is far more equipped to solve a challenge than one person struggling silently. In fact, there is a huge impact on organisations that encompass agile working practices, including a 60% growth in both revenue and profit.

Automation and adding value

Even following the steps laid out above, employee engagement can still be limited within AR teams. This is largely because employees are still completing repetitive manual tasks daily such as invoicing customers, tracking invoices, and accounting for aspects such as early payment discounts and late payments. Finance teams need the right tools to eliminate these mundane and

time-consuming tasks, delivering greater job satisfaction, and creating more value for their organisation. Automation is key to this. By centralising account data and providing transparency between departments, less time is spent chasing relevant information. Instead, staff can focus on more value-adding and engaging tasks.

CorneaGen is one organisation that adopted automation within its AR process, making reporting easier and giving employees more time to focus on improving the customer experience. Its adoption also boosted employee morale, helping them gain recognition for exceeding KPIs and freeing up time to focus on tasks that drive greater job satisfaction.

Employee engagement is vital for driving the success of AR and Finance teams. Without engaged employees, organisations are at risk of high turnover rates, decreased productivity and profitability. Given the economic crisis with falling consumer confidence and business output, it is important that businesses prioritise their AR and finance function to set them up for success. By doing so, employees will value the work they do, yielding substantial benefits for both themselves, and the company as a whole.

Anthony Venus, SVP, Global Accounts Receivable Automation at Quadient AR by YayPay

ARE YOU READY TO HARNESS ESG DATA?

ver the last few years, Environmental, Social and Governance (ESG) data collection and reporting has become a much bigger priority for organisations with over 96% of S&P 500 companies publishing sustainability reports in 2021, according to research from the Governance and Accountability Institute.

There are many factors driving this need to examine and publish ESG data, but at the forefront are customer, employee, and governmental influence. Increasingly, consumers and employees are picking companies that they interact with and work for based on their track record with ESG policies and reporting. Additionally, government bodies and regulators are starting to weigh in with regulations.

While just at the start of the journey with regulations, many government bodies and regulators either have, or are considering, mandatory ESG data collection and ESG data reporting requirements for corporations under their jurisdictions. In December, 2022, the European Banking Authority (EBA) published its roadmap for sustainable finance. The roadmap – a collection of standards and rules aimed at better integrating ESG risk considerations into the banking sector – is set to come into effect in stages over the next three years.

In preparation for the regulations that come along with this roadmap, many European banks have already worked on their ESG data platforms to meet the new requirements around green financing. A key part of this is figuring out how to flexibly incorporate all of the new data sources, types and formats that will be ingested and analysed under the EBA’s new roadmap.

Understanding ESG data

ESG data comes in two categories –‘inside-out’ and ‘outside-in’. Data that comes from companies and is used for analysis is ‘inside-out’ and this data normally lags about 6-12 months behind because it is normally from annual ESG-related disclosures. On the other hand, ‘outside-in’ data is more regularly updated, sometimes in real time. It comes from a variety of sources that banks have access to from financial and company data of

their customers and can have more just-in-time impact. Additionally, outside-in data can also encapsulate the collation of multiple diverse data sources, for example satellite images of fields with water level information meshed up with commercial transportation data.

While most financial datasets are numerical, ESG data normally includes both structured and unstructured datasets. It can include not only text and images, but if a company wants to analyse satellite data to understand their own climate dataset, they may even need to analyse videos. And this is only a few examples of the variety of data, so it is vital to work with a data model that can support many different types of data.

The velocity of ESG data collection and analyses also increases exponentially as organisations embrace the idea of integrating this data in

real-time. For example, loan due diligence used to depend on quarterly ESG data, but as customers demand faster loan approvals, financial institutions are increasingly going to have to rely on real-time data.

With both the variety and velocity of ESG data increasing, so too will the volume of data requiring storage and analysis. Additionally, at the moment, there are no universally applicable ESG standards which means organisations are dealing with many different standards, with different data requirements depending on where they operate.

ESG data in real time

With ESG data, it is vital that it accurately reflects what is happening at the time of use which means the use of real-time data in analysis, reporting and scoring is becoming more common. This, however, requires

harnessing technologies such as cloud computing, AI, and machine learning to instantly track breaking news stories for ESG-related data on investments or incorporating up-tothe-minute satellite data into reports on a firm's environmental impact for example.

Using real-time data platforms, asset and fund managers can calculate accurate ESG scores to aid in investment decisions or risk calculations. Commercial operators can also ensure that their diligence covers their supply chain and in-direct production facilities at third parties.

Leveraging ESG data

A key part of the EBA roadmap is the use of ESG data around loans with environmental sustainability features, or green lending. These loans, sometimes called energy efficient or green mortgages, are typically given

to retail or SME clients to make energy efficient improvements to their properties, think solar panels or funding renewable energy work.

This will have an impact on scoring criteria for green loans and banks will now have to take into account these changes in relation to performance indicators, including the acceptance performance of loans and mortgages. This will also impact loans that have already been originated.

The loan origination process and data systems supporting the process will also be impacted. Banks need to think now about how they are going to tackle evolving or unforeseen changes, capture different data attributes for the same product or loan, incorporate new data types and formats, find insights from data explosion and meet the demands of customers and the competition.

While monitoring the upcoming roadmap and shifting world of regulations around ESG, banks and financial institutions should start to evaluate whether their infrastructure can handle the varied types and volume of data that will be required. Also, breaking down siloed data sets to enable easy search and analysis of data will be key to finding value in ESG data.

Boris Bialek, MD of industry solutions at MongoDB

Continued inflation, rising interest rates and the ensuing cost-of-living crisis will inevitably lead to increasing numbers of customers falling into arrears. Lenders will face the dual pressures of increasing provisions on the balance sheet and the rising operational expense of supporting their customers through this period.

This tough macro-economic environment, unfortunately, coincides with a challenging period in terms of compliance and regulation. The introduction of Consumer Duty in July 2023 means that lenders of all types and sizes need to examine the way they operate and may need to adapt. This new and enhanced set of standards aims to increase the quality of outcomes for customers. Organisations must act now to protect and support all customers, particularly those who are vulnerable – identifying those at risk of falling into arrears and supporting those already in arrears.

Understanding customers’ attitudes to debt

Our recent research shows that a fifth of UK consumers (19%) aren’t confident they are able to pay all their bills and 30% fear they won’t be able to pay an unexpected bill. These figures show a real lack of confidence in the personal

Using data is key for lenders to make informed decisions and navigate a perfect storm

finances of a significant proportion of the UK’s population.

When asked what they would do if they found themselves unable to pay a bill, nearly 60% say they would seek support from friends or family members, but 15% would do nothing, which is extremely worrying.

The lack of reliable and robust data throughout the consumer lifecycle prevents many organisations from effectively communicating with customers or making informed decisions. They cannot form a 360-degree view of their customers, which hampers their ability to adopt a consumer-centric approach to identify and support ‘at risk’ people. Over a third of consumers (36%) say they never get a personalised service from their main bank.

Leveraging data to offer more personalised services

With the impact of the cost-of-living crisis reaching far and wide, there’s a real need to fully understand customers and their attitudes to debt. In particular, it’s critical to identify consumers who can’t repay the money they owe lenders to effectively manage and protect them.

Lenders must take the time to fully understand the different data sources available. Making good use of behavioural data, showing how a customer interacts with the organisation at different touchpoints, will give lenders insight and knowledge into how they are likely to behave in future and will allow them to offer more personalised services.

Such insight can help lenders provide valuable financial advice and ensure their services suit each

customer. It’s their role to guide customers through difficult times – educating and signposting them to third parties if needed to ensure they receive the appropriate amount of support.

Data analytics is key to making informed decisions

Investing in data analytics is key to ensuring the information is properly used to build different customer personas and segments, allowing for insight-driven decision-making and creating personalised services. For example, predictive modelling of customer behaviour enables a forward-thinking and proactive view of the customer, helping to identify who is likely to default on a debt and when. Using such insight will enable lenders to create successful contact strategies.

Likewise, with a Systems Integrator, companies can use sophisticated technologies such as Big Data, AI and Internet of Things (IoT) to provide real-time insights into consumer behaviour and preferences. Financial services providers can use that insight to prevent bad debt, reduce operational costs, and ensure customers are cared for throughout their financial lifecycles.

Adapting communication strategies to customer preferences

Debt can be a highly sensitive and embarrassing topic for many, and debtors may not admit they are in difficulty and need support. The type of communication people prefer reflects those needs. Our findings show that 18% of consumers prefer the lender to get in touch by post if they are falling behind in their payments for a loan or

mortgage, 15% by telephone, 16% via a text message, 12% by email, and 9% prefer to be contacted via a mobile app.

Banks and other lenders must adapt their communication strategies to reflect the spread of preferences across various channels. There is a real need for omni-channel services within the sector to make successful debt collections a reality. Customer journeys need to be designed with integrated touchpoints, offering customers the opportunity to pay on their terms via the channels they use and are comfortable with.

Closing thoughts

Many people choose to ignore their financial worries rather than reach out for available support. Lenders must be proactive in their approach. By revisiting their existing vulnerability and customer engagement methods, financial services providers can better handle customers’ increasing demand for support.

As the cost-of-living crisis continues and Consumer Duty increases scrutiny and pressure on the sector, creating a solid foundation of customer-centric data and analytics will help teams deliver compliant, personalised and supportive services through the crisis and beyond.

Craig Wilson, Managing Director of Private Sector , Sopra Steria UK

Scaling a Business needs Finance Agility and Efficiency

It's incredible how quickly a business can suddenly grow. From opening a new line of business, acquiring a major new partner or just being in the right place at the right time, going from zero to 1000 is an incredible experience. But without the organisation being set up to capitalise on this growth, opportunities that need a swift response can vanish before action is taken.

Because of this, when a business scales up, the finance function must be a beacon of efficiency. It must be agile, flexible, able to anticipate the next turn in the road and prepare the business for each momentous step. And this agility can only be delivered when the CFO takes a lead in transforming the traditional finance function into the intelligent financial hub of the company.

Through automating routine and mundane processes, and integrating smart technology that orchestrates data, the CFO can streamline reporting, analysing performance at the most granular level that provides

new insights across the business. This new finance function provides more services to the business and plays a far greater role in making strategic decisions that drive the organisation forward.

Finance is the home of real business data

For data to be helpful to the business, it must be accessible on demand, reliable and structured. For the vast majority of finance teams, this is a herculean ask that requires a new mindset and equipping with new tools. But with the right finance system in place, the team can remove the laborious process

of scraping data together and begin to derive meaning from the reports themselves, without delegating this responsibility elsewhere within the company. It allows the team to build rapport across departments and units, and enables purposeful discussions based on evidence and genuine business intelligence.

This new mindset means focusing less on processing transactions and moving more toward producing dynamic data that paints a true picture of the business, from moment to moment, and at fixed points in time, to analyse progress. This 360-view not only improves cashflow and forecasting but can shorten the working

Darren Cran, COO of AccountsIQ

capital cycle and make the company’s assets work harder.

This means that the skills within the finance team can be exploited to their full potential. After all, intelligent and ambitious finance graduates didn’t sign up for data entry. The chances are your finance team already has the skills to deliver insights, they just need the opportunity to do so.

And there is no secret magic required to transform finance and create efficiency, it all comes down to the right choice of automation tools and software.

Freeing up your most valuable currency - time

Efficiency isn’t about removing tasks that are unimportant, far from it. But in order to build a new type of finance function, time spent on manual tasks

needs to be minimised. There is recognition in all teams where manual processes dominate, that there must be a better way of working to impact business growth.

Applying technology allows for inverting the traditional finance pyramid, where transactional processing along with compliance and reporting take up the majority of finance time. By automating the tasks that can be automated, the finance team can devote more time to what it should be doing –providing creative insights across the business that support intelligent, evidence-based business decisions.

Along with cashflow forecasting, consolidated and segmented P&L, the finance team also needs to be on top of sales forecasts and the product sales mix. But when multi-entry consolidation or multi-currency

management can tie up a department for weeks at a time, how can the finance department fulfil its expectations without automating these tasks into one-click operations?

Finance must lead by example

After taming much of the manual processes which has plagued the department for decades, the finance team can begin collaborating with other parts of the business. In doing so, they can move from a data entry department to a fully-fledged consulting arm of the enterprise.

Without taking these steps, finance teams risk being a bottleneck in the development of the business. As revenues and opportunities grow, finance teams need to grow in accordance to provide the acute advice and guidance that every fast-moving business requires.

Which Cloud architecture model is best for Insurtech?

It's no surprise that insurers are quickly adopting Cloud solutions as part of their core technology platforms, modifying legacy systems to make way for digitally advanced software. Global cloud infrastructure service spending increased to $57 billion in Q3 of 2022, bringing the industry total for the previous twelve months to $217 billion. There are numerous ways for insurers to use the Cloud to improve their business operations, particularly when it comes to deploying new applications or services, reducing time to market, and improving data storage and backup resilience.

The insurance industry was one of the first to embrace Cloud computing,

with nearly 60% of companies utilising the technology in some capacity. There are several reasons for this, the most important of which is that it allows for greater agility and can handle large amounts of traffic, making it the ideal platform for insurers to scale their offerings during periods of high activity. The insurance industry is highly competitive and regulated, and companies must be able to respond quickly to changes in the market, making the Cloud the perfect solution. It can, furthermore, be used to connect Insurtech systems to third-party providers via APIs, giving them access to better functionalities and improving customer service with real-time responses.

Different Archetypes for Different Requirements

There is no doubt that Cloud computing has transformed the insurance industry, but the most important question for IT leaders in this space is: what Cloud architecture model is best for their business? They have three options for Cloud architecture: public, private, and hybrid, each with its own set of challenges and benefits. The best cloud architecture for a company is determined by several factors, including the type of data they are working with, their budget, and the level of control they require over the infrastructure. Companies must consider the advantages and disadvantages of each type of Cloud

architecture to determine which best meets their business requirements.

Public Cloud Architecture

The public Cloud has democratised technology, allowing businesses of all sizes to access the same level of innovation and scale as the largest corporations. A third-party service provider owns and manages this cloud infrastructure, and the resources are made available to the general public via the Internet. It provides lower upfront costs because resources are paid based on usage, elasticity, and scalability, allowing insurers to adjust resource usage as needed. Finally, it lowers IT costs as the service provider handles most of the infrastructure maintenance.

However, the public Cloud is not without its drawbacks. Limited upfront costs also mean limited control over the infrastructure and security. And with that comes the potential for privacy concerns, as data is stored in a third-party data centre. Public Cloud providers implement a variety of security measures to protect their customers' data, but there is always a risk of data breaches, data loss, or unauthorised access. Ultimately, the greatest challenge comes with the possibility of service outages or disruptions due to shared infrastructure and dependence on internet connectivity.

Private Cloud Architecture

This is a Cloud infrastructure owned and managed by a single insurer, and the resources are only used by that organisation. Private Clouds enable faster and more flexible deployment of new applications, resources, and services than traditional IT infrastructure, while also providing greater control and security for sensitive

data and applications. This means it's an excellent Insurtech solution, as the industry has its own set of regulatory compliance. Furthermore, as long as it is well designed and maintained, it provides greater reliability than public networks.

Nevertheless, the advantages of a private solution entail much higher upfront costs as well as ongoing costs for infrastructure maintenance. Furthermore, the complexities of implementing this type of solution result in companies having limited scalability compared to a public Cloud. Finally, a private Cloud requires a team to manage, maintain, and adjust it as needed, which means insurers will need an in-house IT team with infrastructure expertise.

Hybrid Cloud Architecture

This Cloud infrastructure combines both public and private Cloud architectures, allowing insurers the flexibility to utilise both benefits. Beyond the obvious advantages of elasticity in a hybrid architecture, it also proved unprecedented scalability, depending on usage and workload requirements. What’s more, the hybrid Cloud delivers all the security and compliance needed to manage sensitive data in the insurance industry, while still providing flexibility.

However, with the integration of different solutions comes complexities. Integrating data between public and private Clouds can be challenging, as data may need to be migrated between different systems and formats, and data consistency and synchronisation must be ensured. Moreover, ensuring connectivity between public and private Clouds can be challenging, as different network architectures and protocols may be involved, and security and

performance requirements must be addressed, especially in the insurance industry where most data is highly sensitive. Furthermore, as with any IT solution, there is a potential for security and data privacy issues if not properly managed.

Choosing The Right Tech

Cloud computing can provide greater agility and scalability while also handling high volumes of traffic, making it an ideal platform for insurers. But choosing a solution necessitates a thorough understanding of an organisation's goals, processes, and challenges and an in-depth understanding of the capabilities and limitations of available technologies. The key to selecting the right Cloud type for insurers is to concentrate on solving specific business problems and identifying the technology that best addresses those problems.

Each of the three Cloud architectures has its own set of challenges and benefits, and insurers must weigh the pros and cons of each to determine which one best meets their needs. Choosing the right Cloud architecture model is critical to success in the insurance industry, whether a company is looking for lower upfront costs, greater control over infrastructure and security, or the flexibility to leverage the benefits of both public and private Clouds.

Adam Gaca, Head of Managed Services & CloudOps at Future Processing

Over the past few years, fintech apps have grown rapidly in popularity as consumers have adapted to managing their finances digitally, spurred by the global pandemic. At present, as the cost of living crisis and a looming recession remain a worry for many in the UK, we’re seeing some interesting trends in fintech app usage that prove just how resilient these apps really are, and highlight the opportunities that lie ahead for marketers.

Fintech apps are continuing to grow in popularity: here’s how you can benefit

Lessons learned from 2022

Last year, the fintech industry faced a number of significant knockbacks, from the crypto crash and subsequent ‘winter’ to the downturn in the stock market. Not to mention the wider economic uncertainty and fear of a potential recession.

Despite this, Adjust’s most recent 2023 Mobile App Trends report revealed some positive trends, similar to what we saw in 2022, which demonstrates the resilience of mobile financial services. According to the research, global installs for fintech apps grew 2% in 2022 with EMEA (10%) and LATAM (8%) experiencing the most growth. In fact, this growth is continuing into 2023 – with January up 6% YoY and 13% compared to the 2022 average.

In addition, we saw that consumers are using the apps more, as global sessions grew 19% YoY in 2022 — up most notably in LATAM (54%) and EMEA (40%). Evidently, even with understandable economic uncertainty, people are turning to their fintech apps to manage their funds. Sessions are also up so far in 2023, with January seeing 7% growth compared to the 2022 average and 15% compared to January 2022.

Importantly, users also spent more money YoY in 2022 compared to 2021. Fintech in-app revenue skyrocketed 44% YoY. November and December were the main months driving this impressive upward tick, increasing 83% and 112%, respectively, compared to the year’s

average. In fact, December 2022 was the highest ever month for fintech inapp revenue tracked by Adjust.

With installs, sessions and spending in fintech apps increasing across all regions and sub-verticals, it is clear that the global fintech app ecosystem is thriving. Across the board, fintech apps have been able to retain the stream of customers gained throughout 2020 and 2021.

What we can expect to see in 2023

Continued growth can be expected from this space in the next year, even more so as the increasing cost of living drives consumer interest in easy money management. Consumers will continue to realise and take advantage of the benefits of fintech apps - simple payment processes, quick access to funds and effective money management tools, to name a few. It’s a great time to lean into this growth to look for app growth opportunities to retain valuable customers as we take on 2023.

Having said that, there will be users who are wary of the recession and are therefore not spending as much. To counter this challenge to revenue, fintech apps must focus on attracting and retaining customers by providing the best possible experience for their users. Developers must create features that complement the app’s core functionality to encourage continued engagement even when users are not actively spending.

Gathering feedback from app reviews, in-app prompts and email surveys will be crucial. App teams can then capitalise on what’s working well and work on fixes for what isn’t as effective. Identify points in the user journey when disengagement is highest and alleviate these pain points or insert prompts at these moments to get clear insights directly from the users themselves.

And more critical than ever in a time of needing to do more with less, fintech app developers must take full advantage of app analytics to optimise apps and marketing campaigns. The analysis of performance data is used to understand the user journey better and make informed decisions. Without app analytics, developers cannot clearly identify potential problems with their app and/ or campaigns, nor can they identify corresponding solutions.

In a competitive market with over 2.2 million mobile applications available on the Apple App Store and 3.5 million apps on the Google Play Store, the insights gained through app analytics are critical components to success in converting, engaging and retaining users with high lifetime value.

Alexandre Pham, VP EMEA, Adjust

Bringing VCs into the 21st century:

with transparency at the top of the agenda, investors need to stay ahead to survive

The venture capital industry is a crucial element in the startup ecosystem, providing funding and support to early-stage companies with high growth potential. However, the industry is currently experiencing its greatest reckoning since the dotcom bubble bursting. We’re witnessing down rounds and slashed valuations in real time, as tech layoffs rage on, funding slows and returns decline. The economic downturn sparked a recalibration for investors worldwide, with grave consequences for overhyped, overfunded, overvalued tech giants and their backers.

VC investors have been scarred by the legacy of the scammer CEO. Just last year, FTX’s Founder and ex-CEO Sam Bankman-Fried joined a growing list of now infamous fraudster founders. Theranos’s Elizabeth Holmes, WeWork’s Adam Neumann and ‘Pharma Bro’ Martin Shkreli have all demonstrated the dangers of buying into a ‘visionary’ as opposed to a viable opportunity. But post-Theranos, post-WeWork, post-FTX, the only way for the venture industry to show it has really learned its lesson, is to demand radical transparency.

These scandals have acted as a catalyst for a long-needed change. For years, the VC industry has not kept up with others; staying stuck in the stone age with models which do not encourage transparency and thorough due diligence which are the cornerstones of fostering innovation, increasing social responsibility and entrepreneurial drive.

Professional investors are facing this increasing scrutiny to stay ahead, with LPs demanding immediate clarity and expecting their investment returns to be presented alongside human social impact. As we enter into this new era of VC investing, transparency will become paramount. But that can only be achieved when information is ultra-accessible and readily available. In doing so, due diligence can evolve from a burdensome chore into an easy and ongoing process.

So, how can VCs navigate the choppy waters ahead?

1. Beware of misleading KPIs: Both ride-hailing/sharing apps and grocery delivery services have fallen victim to this phenomenon. “Fear of missing out” clouded investors’ judgment, who got overly excited by growth metrics and soaring valuations.

Of course, that user growth was often driven by generous discounts, subsidised by venture capital itself. A loyal customer base could not be sustained after these tempting discounts ceased. Consumers were in no way sticky and loyal to a brand, switching to competitors when lower prices were offered. User growth is not the only defining metric to pay attention to when seeking out venture opportunities.

Investors need to look under the bonnet to get a more complete understanding of the financials of the business, paying attention to what really is going to drive long-term, sustainable growth. Early stages of growth are very linked to social, political and economic contexts which can lead to quick – but ultimately unsustainable – customer growth. What really matters, and what VCs should be inspecting, is how these companies acquire news customers. A stable business must have three predictable means of acquiring new customers - for example, through social media, digital advertising and SEO strategies.

2. Interrogate the product: VCs should be requesting – and demanding – product demonstrations. They don’t just need to inspect the business’s finances. They should scrutinise the offering, how it will work, how it will scale, and whether there is in fact a true market demand. In fact, if a VC does not request a detailed product demonstration, it should act as a red flag to portfolio companies - a sign that the investors have nothing to offer but capital, and potentially lack the invaluable expertise and guidance truly inquisitive investors can offer.

3. Always be driven by data: Taking a data-driven approach can reduce bias and the inequality gap in startup funding. According to Andre Retterath, only 10% of VC decision makers in the industry are women, and opportunities for female-owned companies account for only 2.2% of global VC funding. It is clear that gender bias is a pressing issue for the industry, and part of this problem

stems from outdated data processes at sourcing and screening stages. Data-driven VCs who take advantage of tools which reduce manual workflows will be able to make more investments which fight this inequality gap, ensuring that funds are used for social good.

4. Walk the walk: Transparency should go both ways. If VCs are demanding it of their portfolio companies, they too should practice transparency. VCs need to be willing and able to clearly communicate how and where their values align with their portfolio companies’. Taking it one step further, they should also offer an insight into how the fund is being operated, how it is performing, and what its longer-term plans are. Transparency can be a reputational advantage for both VCs and start-ups.

The venture capital landscape is changing rapidly, and the outcome is that LPs are (quite rightly)

increasingly wary and are questioning more how their funds are being invested. Transparency should at the top of VCs agenda throughout the entire investment journey, from the initial KPIs right through to presenting results to LPs. The traditional model of management – namely, spreadsheets – is outdated and not fit for this purpose, presenting a real danger to professional investors. The industry must be brought into the 21st century; ultimately, a digital revolution will drive innovation, foster entrepreneurship and increase financial growth.

Clément Aglietta, Co-Founder and CEO, Edda

THE UNDERDOG TO TOP DOG MENTALITY

Korosh Farazad, a distinguished veteran in the world of investment banking and private equity. With over 20 years of invaluable experience, Korosh has consistently demonstrated an exceptional level of expertise and professionalism in his field. Throughout his illustrious career, Korosh has been instrumental in structuring complex financial transactions with some of the largest Private Equity groups on a global scale. Their extensive portfolio spans across continents, successfully managing and advising elite clients ranging from Asia to North America. Korosh has honed his skills and insights by working closely with renowned industry leaders, cultivating an in-depth understanding of the ever-evolving dynamics of the financial landscape. His commitment to excellence and strategic

acumen has positioned him as a trusted partner to esteemed clients, assisting them in achieving their investment goals and realizing substantial returns.

It is a privilege to have Korosh here today, and we look forward to benefiting from his unparalleled expertise as we navigate the intricate world of investment banking and private equity.

1.

Pleasure to have you here. Please tell us about your presence being a global Boutique Investment House.

Thank you for having me. Farazad Investments is a subsidiary of Farazad Group, and it compliments rather than competing with

A talk with Korosh Farazad,Co-CEO, Farazad Investments

Photo Credits to Mr. Kosta Ivanyshyn

the other subsidiaries of the group of companies. Mostly, 80% of the business model specialises in the Real Estate Capital Markets with a strong emphasis on the hospitality investments. We focus on an A-Z structure, where we assist our clients with all elements of the capital stack (combination of different types of financing constitutes a mix of debt and equity instruments, each with varying levels of risk and return.), identifying hotel operators whether they are franchise operators or Hotel Management Agreements (HMA), different F&B concepts to compliment the region, theme of the operator, providing ideas and concepts for other revenue streams for the asset and not simply focused on the revenues from the room and occupancy rates. Having the ability to operate worldwide, it allows us to cater to clients in different countries and regions. We provide a personalized and tailored services to meet the unique needs of our clients in the real estate and hospitality sectors alongside other sectors that are not strictly hospitality driven (multi-residential, industrial, student-housing, etc.). We have a developed expertise and deep knowledge in these areas, allowing it to offer specialized advice, strategies, and solutions. Everything is done in-house, from the initial assessment to deal structuring and execution, which allows us to take full responsibility for the work we do and always have a direct dialogue with our clients and investment partners.

The other 20% of our business model is Corporate Finance, M&A’s, and introducing qualified companies with a healthy EBIDTA and business plan, to become a public company (IPO) within their jurisdiction.

We have a very talented team of people working for the company in Hong Kong, Seoul, and London, which allows us to have a wide reach of different equity investors, lenders at our fingertips to introduce potential opportunities subject to pre-underwriting the deal to understand the validity of the transaction and its success ratio. We currently have two companies that are going IPO in S. Korea and the other in Melbourne, Australia. The Korean opportunity is absolutely going to revolutionise hearing aid and I think by

the time this interview published, the company will be officially a public company.

2.As of date, Farazad Investments continues its global business expansion. What are the upcoming strategies?

Let me start by saying, I never thought that the company would be in the position that it is today with roughly US$ 1 Billion in deal flow and mandates in its books, and more importantly, the expansion of the other subsidiaries, which are Farazad Advisory, Farazad Ventures, Farazad Facility Services and HYDE Recruitment (outsourcing temporary workers to Hotels across UK to fill in the labour gap post BREXIT).

Sector Diversification: To focus on diversifying client base across various sectors. By expanding the expertise beyond a single industry, this way, we can can reduce risk and capture opportunities in different market segments.

Geographical Expansion: We are aggressively considering expanding presence into new geographical regions or markets. This would constitute establishing offices or partnerships in key global financial centres to attract a wider range of clients and access different sources of capital.

Enhanced Deal Sourcing: We have planned and now in action to develop robust deal sourcing capabilities to identify attractive investment opportunities. This may involve leveraging technology, data analytics, and networks to discover untapped markets and high-potential projects.

Specialized Advisory Services: This goes back to the subsidiary companies complimenting and not competing, our specialized advisory services that provide unique insights and value-add to clients. This includes in-depth sector expertise, customized financial solutions, and strategic guidance throughout the investment lifecycle.

Innovation and Technology: Embracing technological advancements and innovation can significantly enhance efficiency and client experience.

We have monitored this sector and have considered investing in advanced data analytics, artificial intelligence, and automation tools to streamline processes, improve decision-making, and provide real-time insights to clients.

Sustainable and Impact Investing: There is a growing trend towards sustainable and impact investing. With 90% of our transaction, we have incorporated environmental, social, and governance (ESG) into our client’s investment strategy, only if one was not implemented prior to them introducing the transaction to us. Further, we offer clients opportunities to align their investments with their values with ESG would is an imminent win for all parties.

Capital Markets Expertise: Given the mandate to raise both equity and debt financing, this requires for us to always be tuned and up to date on market trends, maintaining relationships with investors and lenders, and offering innovative financing structures tailored to clients' needs.

Client Relationship Management: One of the

core and fundamental focuses for us is building strong, long-term relationships with clients. By providing exceptional client service, maintaining open lines of communication, and understanding their clients' evolving needs, they can foster loyalty and attract new business.

3.As a CEO of a boutique investment house, what are the leadership and management skills you have implemented to have the team benefit from?

Clear communication: One of the most essential skills for any leader is the ability to communicate effectively with the team. Despite the challenges this may have, I have developed a clear communication plan and ensure that everyone is aware of their roles and responsibilities.

Empathy: Being an empathetic leader means understanding and acknowledging the team's perspectives and needs while leading them towards achieving company goals. Encourage and motivating the team to speak up, listen

actively to their concerns, provide solutions, and foster a safe and respectful work culture.

Focus on Goals: Focus on setting clear and measurable goals for my team so that they can strive to achieve them. These goals can further motivate them and allow them to showcase their individual strengths and work collaboratively to achieve the shared goals.

Lead by example: Leading by example is a crucial aspect of a good leader. It means that I must always demonstrate the qualities that I want my team to embrace. Show initiative, be proactive, prompt, organized, and disciplined.

Continuously learn and develop: As a leader, it is super important to continuously teach/ guide and develop their skills to become better. Encourage them to learn and grow by providing ongoing training and development opportunities to enhance their skills and knowledge where and if needed.

4.

Do you have a hobby outside of work that helps you be a better leader?

As a CEO and running several companies literally simultaneously on a day-by-day basis and making precise and calculated decisions is part of the process and therefore, engaging in hobbies or as I call it “different value-add activities” outside of work can be instrumental in enhancing leadership skills and adapting to a constantly changing world.

Reading: Cultivating a habit of reading helps broadens my knowledge and understanding of various subjects, including business, leadership, economics, technology, and global affairs. It enables me to stay informed, think critically, and make well-informed decisions in a rapidly evolving business landscape.

Physical Fitness: I maintain and try to maintain an active lifestyle through exercise or walking to my meetings and getting in my 10k steps on a daily basis, which not only promotes my well-being but also fosters discipline, resilience, and determination.

Traveling: One of the values and perks my job offers is the travelling. I travel on average once per week outside of UK; this is either day trips or overnight stays. This most certainly allows me to experience different cultures, meeting diverse individuals, and experiencing new environments that most certainly expands my perspective and develops my adaptability. I am proud to say, I have lived in several different countries and for me, adapting is no longer a challenge, and it is considered art!

5.

What do you expect 2024 to bring?

To be perfectly candid, we had no idea how 2023 was going to turn out and we managed to overcome some very challenging times in terms of cost of financing, identifying different equity partners with the same vision and alignment with ours and our clients.

Of course, the specific outcomes can be influenced by various factors and are subject to market conditions and economic trends. To continue with the positive streak and not get side tracked with the volatility of the markets and pessimism, we focus purely on

Market Conditions: The performance of the financial markets can greatly impact the activities of our group. If the global economy continues to grow steadily, it will create a favorable environment for investment and capital raising activities. However, market conditions can be volatile and subject to various risks, including geopolitical events, regulatory changes, and economic downturns. It's crucial to stay vigilant and adapt to changing market conditions.

Deal Flow: As of 30 May 2023, we have roughly US$ 750 million of mandates within our active pipeline. The deal flow can be influenced by market sentiment, investor appetite, and industry-specific trends. If the economic environment remains favorable, we can easily see increased activity in mergers and acquisitions, capital raising, and advisory services.

Technology and Innovation: The financial industry is undergoing rapid technological advancements, including digital transformation, automation, and artificial intelligence. Embracing these innovations can enhance operational efficiency, streamline processes, and improve client experiences, which has had integrated this year but 2024, this process will be ramped up significantly.

With the foundation that I have created just within the last 5-years has allowed the company to work seamlessly and continuously grow by 20% on average. This is simply with the structure, which I have explained above.

Talent and Team Development: As the CEO, last year, I started preparing and nurturing a talented and diverse team for the long-term success of the brand. Therefore, for 2024 and beyond, investing in employee development, attracting top talent, and fostering a culture of innovation and collaboration will be vital.

- Korosh Farazad, Co-CEO, Farazad Investments

How to find an investor that matches your business values

In the past few years, I have seen businesses partner with investors that do not align well with the companies’ values and the consequences can be devastating to long-term growth and profitability and overall performance of the companies.

Finding an investor who aligns with your business values is a critical step in building a successful partnership that can only benefit your business in the long run, but for many businesses, too often there’s a temptation to take investor money without thinking about whether the investor is someone who shares your vision, or you want to work with long-term

Here are five steps to first consider before partnering with an investor:

Step 1 - Outline your business values

Start by clearly defining your company's values. What is your mission and vision? What are your core beliefs and principles? Write them down and make sure they are clear and concise, the more detail the better. The key aspect is to define boundaries and what you would do or not do. For example, if you are a consulting business, will you share findings from an assignment with a competitor of a client?

- Rafael S. Laujenesse, CEO of ReachX

Step 2 - Research

Look for investors who share your values by researching their investment philosophy, portfolio companies, and previous investments. You can also use online resources such as Crunchbase, AngelList, or LinkedIn to search for investors, there are many resources online for you to do your due diligence in the first instance. Once an investor is interested in investing, there is a bit of a reverse process, where they lay out all the value they can add to your business. This is an important moment to investigate the softer side of investing, and see if trust can be established. The investors you will invite in your business will make decisions with you over capex, acquisitions, and potentially taking other investors or even selling the business. You want to create a partnership with this investor.

Step 3- Network

Online resources are great but there is also tremendous value in attending networking events and conferences related to your industry or niche to meet potential investors. This enables you to make important connections, ask questions, and get a better sense of who shares your values.

Step 4 - Word of Mouth

Word of mouth referrals are a great tool to scope if an investor is right for you. Ask entrepreneurs, advisors or mentors for referrals of investors who may align with your company values. This can be a great way to find investors who are a good fit and has the added bonus of a referral from someone you already trust

Step 5 -Interview potential matches

When you have identified potential investors, a good way forward is to set up interviews to truly learn more about their investment philosophy, values, and goals. This will help you to determine if they are a good fit for your business and gives you the chance to get to know them.

So you’ve taken the first step, done your due diligence, but the question is why is it so important to partner with an investor that shares the same values as your business?

Reasons why alignment in values with an investor will benefit your business

Goals alignment

When an investor shares your company's values, they are inclined to understand and support your company's goals. This can lead to a more harmonious working relationship because both parties are pursuing the same goals.

Cultural compatibility

Investors who share your values are more likely to fit in with your company culture. A good cultural fit can lead to improved communication and collaboration between the investor and the company, which is critical for long-term success.

Growth that is sustainable

When it comes to achieving sustainable growth, an investor who shares your company's values is more likely to be patient and understanding. This means they are more inclined to support long-term objectives rather than short-term gains, which can lead to more sustainable and stable growth for your company.

Brand image and reputation

Partnering with investors who share your values can help to strengthen your reputation and brand image which is vital for successful business growth. It can convey to customers and other stakeholders that your company is dedicated to certain principles and values, which is very important in today's socially conscious environment.

As a founder, you are responsible for your company's values. Although you may not own all of the company's shares, the ethics and standards that guide your business will always be yours to manage. Because of this, you need to protect what you've created, so do everything you can to maintain your control. Overall, finding an investor who shares your values can help your scale-up business achieve long-term success while maintaining its principles and values. A win-win for everyone. It is important for your Board, your employees, and your partners to get this right.

About Rafael S. Lajeunesse

Rafael is CEO of ReachX and responsible for driving the company's vision to be the trusted platform for institutional investors and corporates, offering bespoke Investment banking services and access to investment opportunities and capital. Prior to ReachX, Rafael worked with JPMorgan & Co. in London where he was a Portfolio Manager. He was also a consultant with McKinsey & Co. in New York working with clients across media and financial services. He earned an MSc. from the EMLyon Business school and received his MBA from The Wharton School.

Alister Sneddon, Head of Product, CMC Invest

maximising investments; minimising Fees

Without planning and research investing can come with more ‘investment’ than you bargained for. Namely, incurred fees. As we face the ongoing economic crisis, more people are turning to investments to protect their money from rising inflation rates. So now, more than ever, it’s important for all investors, new and experienced, to consider potential fees when choosing investments.

There is a range of potential costs, from management charges to transaction costs. Calculated incorrectly, they can affect your investment’s performance, compound losses, and restrict returns. Shockingly, finder.com research shows that the average UK investor could lose up to £1,200 a year on broker fees. No investor wants to lose money, let alone unnecessarily on fees, and especially, in the current economic climate.

What fees should you look out for?

Well, there are a fair few. Most can’t be avoided, but fees can be minimised. Let’s break them down:

Fund management fees: if you have investments in a fund, you need to consider the annual management fees. These cover the cost of your fund manager and are set by the fund management group. Occasionally, larger platforms will receive a discount from the funds, which means you might be charged a higher platform fee and a lower fund fee. Don’t be fooled by the trope of ‘higher price, higher quality’; a high fee does not guarantee high performance. Compare how funds have performed in the past, and from there you can judge whether the price is fair versus competitor rates. Past success is never a certain measure of future performance, but it’s a great place to start.

FX fees: if you have investments in stocks outside the UK, once you transfer them back into sterling there may be a hidden cost. Depending on the spread of your investments, this could be fairly large and will be impacted by the size of each transaction - and how many you make. This fee can’t be avoided, but being consciously aware of the hidden costs will help you make strategic decisions to minimise the total fees each year.

Commission: every time shares are bought or sold on a platform you will be charged a fee for the transaction. It will depend on each platform how it’s calculated; for instance, it could be a set fee or based on the size of the transaction. So, always make

sure to research and compare ahead of choosing a platform.

Platform fees: as the name suggests, rather than linking to a transaction, these fees cover the general costs of using a platform for holding investments (custody charges) or administration fees - this includes both SIPP and ISA charges. How and what you are charged will vary, so research is important here. It may be a monthly flat fee, or it could be a percentage fee based on the total value of your investments. Typically, they will all be wrapped up together as platform fees.

It doesn’t stop there. Other hidden fees include; account opening fees,

withdrawal fees, dividend reinvestment charges, and exit fees. Being mindful of every potential expense will help you make informed and measured decisions.

Managing and minimising platform fees

Over time, fees will add up, so something you considered okay to begin with may start to impact your total take home. Assessing your situation will drive which fee option suits you. For example, if you invest large amounts each month, a flat fee will most likely give you higher total returns than a percentage.

Likewise, if you know you will

rebalance or buy and sell holdings regularly, this will increase your trading fees. Focusing on a long-term strategy will help to minimise hidden fees associated with a change of tack and make extra costs more ‘predictable’.

No more hidden costs

Though you can’t eradicate associated costs, being aware of them will ultimately put you in the strongest position going forward. With every decision you make, assess how it will contribute to your end goal and the cost of doing so - accounting for every fee, even if it's only a potential. By taking back control, you will maximise your chances of success.

A DIGITAL AND AUTOMATED APPROACH TO ANNUAL BUDGETING IS A NO BRAINER

Simon Bittlestone, CEO, Metapraxis

Speak to any CFO, especially in large multi-national organisations, and they’ll tell you about the relentless challenges they face with regard to creating annual budgets and business forecasts. Why? Budgets and forecasts are still often created and delivered manually in Microsoft Excel – which is undoubtedly an excellent tool and offers numerous benefits to FP&A teams – but it isn’t designed for this activity.

The challenge of Excelbased budgeting

Typically, organisations tend to follow a similar annual budgeting process. The central finance team creates a starting point for the new year’s budget, often rolled over from the previous year, with a targets incorporated. Depending on the size of the enterprise, anywhere between 10 and 200 people will then typically input into the budget, starting with the revenue plan through to build up of costs, and the impact on cash flow and the balance sheet. The central finance team then has the unenviable task of consolidating all those inputs manually into a single Excel budget spreadsheet. This in itself is no mean feat, when you consider how

complex, time-consuming and error-prone this process is.

The finance team summarises the context to reflect the assumptions such as the marketing expenditure required to achieve new product sales and so on. Following the presentation of this mammoth budget spreadsheet to the CFO and senior management, changes are inevitably needed, which in turn means that further input from many of the 200 people who originally contributed is required. This process continues until the CFO, management and the business units at large are on board with the business goals and targets for the year. The timeframe to reach this point could range from anywhere between three and six months, with numerous team members having

time and headspace for little else.

The difficulty of this exercise is easy to grasp. A single misstype could break a formula or even multiply an error, the repercussions of which could potentially be catastrophic for the enterprise. Most finance teams have their war stories. A fortnight away from budget presentation D-day, whilst conducting the final checks of the annual budget, the central finance team in a US based multi-billion dollar business spotted an error, resulting in the department having to completely re-do the entire budget to ensure accurate representation when submitted to the Board. One small mistake led to the team working long into the night and weekends to meet the deadline.

Digitisation for strategic insight

In today’s predominantly digital business environment, fighting with Excel spreadsheets is a futile and wasteful exercise. A digital approach delivers the same results in a fraction of the time, saving the enterprise a significant amount of money. To illustrate a hypothetical scenario, an organisation comprising five business units, each with 10 cost centre owners, running an Excel-based manual budgeting process across revenue, cost, capex and cash flows, before a group-wide consolidation process, incurs c.370 days of effort versus under 130 days if a digital and automated methodology were used. The total cost saving in such a scenario would be c.$200,000 per year, before any of the benefits of improved accuracy and better use of time are quantified. This estimation is based on a budgeting calculator that leverages industry standards and best-practice to arrive at a cost saving calculation.

Furthermore, budgeting isn’t only about revenue and cost numbers, it’s also critically about understanding business trends in the organisation, identifying the opportunities and risks, and based on data insight, taking better decisions to achieve commercial goals.

In a digitised finance operation, adoption of automation can help exponentially shorten the time to produce the budget, freeing up FP&A teams to provide strategic insight into the business, and in doing so add value and expertise.

A large corporate’s central finance team confessed that prior to adopting an automated approach to annual budgeting, the department was spending nearly 80 percent of its budget process time inputting and sanitising the data, until they moved to a digital process which instantly brought the time down to under 20 percent.

Digitisation a foundation for analytics and AI

With the digital fundamentals in place, FP&A teams can leverage their datasets for analytics to better understand business performance, areas for growth and even the broader environment within which the organisation operates. In which business units are staff costs out of line with revenue growth? Which divisions are underperforming against their annual targets? Are there signs of customer churn brewing? Can we better predict customer demand over the next three years? Is there an opportunity to launch a new product or service? Is there the right correlation between marketing costs and revenue?, and the list goes on.

The days of Excel-based budgeting are numbered. In the next decade, large swathes of finance and accounting work is going to be automated through AI, and anyone who doesn’t believe, I dare say, is burying their head in the sand. These technologies require a robust foundation of digitised processes, and now’s the time to do it.

How to use data around open source projects

Open source has become one of the most recognised movements in technology in the last decade. According to Red Hat, 90% of IT leaders use enterprise open source software, and by 2026, the open source services market will be worth $50 billion. The number of open source projects and businesses based around open source has skyrocketed over the past decade.

These projects need people to support them. This takes money. Traditionally, this would come from venture capital firms that would provide funding that would go into recruiting staff, developing the community and growing a business. In today’s climate, securing funding for these kinds of businesses has dropped massively - during 2022, investment in startups dropped by 43 percent compared to the previous year according to Crunchbase. Today, venture capital firms are focusing on companies that have a clearer path to sustainable revenue operations. So how do you quantify these opportunities for them, and help them understand growth?

Cowboy Ventures shared that ‘usage’ is the number one metric investors look for when deciding on which companies to fund. The Cowboy Ventures team found that “running a project in production signals trust as it can impact end-user experiences.” Similarly, Redpoint Ventures recently published their top 25 open source infrastructure companies, which compounded the need for the rate of growth to be tied to external contributors, not stars on GitHub.

The team at Redpoint commented: “We anchor too much on total GitHub stars. In our opinion, usage is the most important metric.” For firms looking at investing in open source, this real world data is an essential guide for who to back at the beginning.

Building a business, not just software

The film Field of Dreams is best remembered for the line, “If you build it, they will come.” But wildfire open source adoption does not just

happen, and it does not guarantee commercial success even if it does. Garnering millions of downloads or recruiting thousands of contributors does not equate to a capacity to monetise.

Cultivating a viable business around an open source project hinges on the company’s ability to turn anonymous usage of that software into a set of known users, and then to turn some of those known users into paying customers for a product or service around that software. To invest in such a business is to take a bet on the effectiveness of that funnel, so it’s critical for investors to understand the real number of active users and their propensity to become customers.

Contributors offer a starting point to understanding who is using the project, but typically this is an extremely limited subset of the user base. Any company that strives to commercialise its product and grow to the next level will inevitably need a more complete picture of their adoption metrics.

These metrics all exist, but - even though it is your software that you are making - not all of them will be available to you, let alone all in one place. Solving this problem will help you understand your business and provide that proof to others. You need that level of data to know that you are on the right track by getting insight into how often your software packages are downloaded, but more importantly how often those packages are put into production deployments. This information helps you track your growth with production

users, demonstrating their success and providing insight for you and any potential financial backers as well.

At the same time, there is no set path to follow around what those customers will actually buy. Some companies trade on their support and skills, while others use cloud hosting as the product and run their open source project on top. It can be easier to sell cloud rather than services, as cloud is a tangible product, but it is not right for every project or market. The most important lesson here is that your business may have to change over time, based on what customers are willing to pay and what they want to buy.

Creating a sustainable business is hard. Creating that sustainable business when everyone thinks you are giving your product away for free is even harder. However, it provides a route to bigger potential markets and revenue opportunities compared to building a product and selling it on its own. To be successful, it needs that long term view. At the same time, investment in areas like open source is necessary to develop those projects that can support wider ecosystems, build companies and maintain healthy communities. For VCs, using real-world data on where projects are being used in production can show where those opportunities to invest are, leading to real returns over time.

Avi Press, CEO, Scarf

BALANCING DATA SECURITY AND CUSTOMER SERVICE IN FINANCIAL SERVICES

Agam Kohli, Director, CX Solutions Engineering, Odigo

Data is a commodity that is only getting more valuable, and the financial services industry is certainly no stranger to this fact. The sheer amount of data that is stored and flows through these organisations is immense.

And with the UK having the highest number of cybercrime victims per million internet users at 4,783 in 2022, it’s no surprise the ongoing risk of cyberattacks and data breaches has made security a top priority for organisations. So much so, a total of 29 financial services organisations recently took part in the annual NATO cyber security simulation

However, as the move towards online banking increases – with an estimated 93% of British consumers using online banking in 2022 – and with it the drive to increase security measures, it is imperative that financial organisations are balancing these needs with the continuing priority to provide customers with quality customer experience (CX).

CX and data security in the cloud

With such sensitive data, it’s understandable why financial organisations, and their contact centres, put measures in place to secure protect their most valuable assets. Indeed, 73% of finance and insurance businesses consider cyber security as a high priority. There are any number of factors, such as poorly configured platforms or a lack of training for contact centre agents around security, which could result in gaps in security that could make data, including customers’, vulnerable.

Nevertheless, a seamless customer experience cannot be overlooked and securing data should come hand in hand with the priority to retain customers. This can be made difficult though if the implemented security measures end up acting as a barrier to agents being able to provide a high-quality customer service. Even more so when financial services organisations still rely on legacy systems that silo data, making it hard to access when it’s needed.

To address this balance, many are turning to the cloud to harness its accessibility and automation benefits. Especially given all of an organisation’s data is kept in one place and security is inherently baked into the infrastructure. Via unique login details to the cloud services, each contact centre agent, and every employee more widely, should be able to access all the relevant, and essential, data to not only do their job but provide a high quality, and secure, customer service.

Securing data as it flows

But what about newly captured data flows? Put simply, no matter what, customer service and conversations must be secured, as each new customer interaction could result in new data points, often personal and confidential.

Artificial intelligence (AI), in combination with an interactive voice response (IVR), can help facilitate intelligent data transfer according to the caller’s needs and preferences. Especially when it comes to maintaining the security of payment details. A blend of a cloud solution with AI-based tech can help to safely migrate data and quickly detect any data leaks in transit.

However, this is only effective to an extent. It is equally imperative to restrict access to sensitive data to only those people that need it and implement tracking systems to monitor activity. Some financial services organisations may also consider doing continuous vulnerability sans and early vulnerability detection to further protect their data.

Whilst the risk of cyber-attacks remains a top priority for financial services organisations, and by extension their contact centres, they cannot afford to let it hinder the quality of their customer service. By using cloud-native solutions in combination with AI-based technologies, contact centres can benefit from individualised, quick and secure access to all the data they need, both in storage and transit. All of which gives them the tools they need to continue providing customers with a top-quality experience that has security at its heart.

it’s time to transForm corporate banking, and the answer is embedded Finance

Embedded finance has sent customer expectations soaring. Integrating a bank’s services directly into applications that their clients use is fast becoming second nature, with products like mobile wallets now so commonplace that services like Transport for London no longer require payment authentication

trillion in the US alone. Considering this simply as a growth area within banking is an understatement – it is a catalyst for the full transformation of once-stagnant operations and services.

ecosystem, banks can deliver interconnected services and grasp the embedded finance opportunity, able to deepen the value of their corporate relationships and create a new class of delivery channels.

Seamless services end-to-end

As embedded finance disrupts the market, it is affecting the value of existing products and services, especially in corporate banking. By 2026, its transaction value will more than double to $7

Now, banks are setting their sights on the opportunities that embedded finance holds for their corporate clients. While corporates represent one of the most profitable segments in banking, they’ve consistently lagged when it comes to investing in innovation, often held back by manual processes, disconnected systems, and siloed data. By investing in a digital

Embedded finance is all about making connections. Fragmented systems and disparate databases slow down progress, with banking portals often disconnected from enterprise resource planning (ERP) systems. From the onboarding process to reconciling different views, tedious navigation becomes a necessary evil to find the simplest of answers. As highly personalised products and services become standard, large banks can struggle to keep up with evolving expectations.

Conor Colleary, Group VP in Financial Services at Oracle

With embedded finance, banks have an opportunity to leverage real-time transaction insights to power connected journeys. Yet, this is only possible when they bring data together. With the visibility of all client data in a single platform, banks can create greater transparency, reduce errors, and minimise time-consuming administrative tasks. Banks can also harness historical and real-time transaction data, crafting unique new financial offerings and closely connected customer journeys that fortify client relationships.

Level up liquidity management

As well as improving the customer experience, embedded finance enables corporates to understand the risk on their balance sheet and helps position banks to better manage risk for customers. Multinational companies often keep several bank accounts, incurring higher expense

reconciliation and operational costs. This fragmentation breeds ineffective working capital management, difficulties forecasting, and a lack of real-time view of cash positions. This is especially difficult to contend with in the cost-of-living crisis, with banks contending with increased difficulty managing cash flow.

By connecting applications and data across the financial organisation, leaders can gain a rapid, clear picture of customer demands and capital reserves. With embedded finance solutions such as payments on behalf of (POBO) and collections on behalf of (COBO) programmes, corporates can easily assess their balance sheet risk, use real-time treasury to enhance liquidity management, and position themselves as better risk managers for their customers.

Pro-active, faster lending and payments

With the real-time, rapid nature of embedded finance, corporates can not only manage the risk associated with lending, but deliver loan services to clients in just days instead of months. Embedded finance empowers banks to help corporates succeed at every stage of the banking life cycle, from finding and securing consumers, to optimising capital and facilitating trade. For example, embedded finance gives banks access to financial information without the need to manually upload data to an online portal. It puts lending at the point of purchase, without the need to visit the bank or spend time filling in lengthy paperwork, with services like buy now, pay later (BNPL).

As for payments, corporates expect faster processing from banks to keep up with the speed and ease of personal banking. However, most banks

still process payments in batches, hindering real-time views and lacking analytics capabilities to promptly address issues. This lack of visibility into underlying payment analytics, fees, and volumes makes it difficult for back-office staff to understand the source of errors and perform corrections. Moving to more intelligent payments enabled by embedded finance, can reduce the time and amount of cash held in transit and improve liquidity. With payments sent instantly through APIs and linked to accounts for supplier-level analytics, banks can offer greater operational efficiencies and increased client satisfaction.

Building the future of finance

Bringing artificial intelligence (AI) into the mix is the next step in embedded finance. By leveraging embedded finance data, banks can cross-sell banking services beyond treasury, provide new value propositions to corporates, and embrace new business models. Harnessing the mass of data that banks hold, and using AI to gain valuable insights from this, can help to increase customer safety and personalise their experience. Corporates can then predict customer transaction patterns, even analysing client data in real-time, to provide prompt, AI-powered, contextual offers to clients exactly when and where they need them.

As competition from agile challenger banks grows, embedded finance empowers incumbent financial institutions to reimagine their value propositions and support clients to succeed across every stage of the corporate banking lifecycle. Banks and their clients can foster powerful, profitable partnerships, capitalise on these new opportunities, and bring operations into the new age of finance.

AWARDS WINNERS LIST 2023

Winners

AdroFx Best Online Forex Training Brokerage Company Vanuatu 2023

AdroFx Most Outstanding Micro Trading Forex Brokerage Company Vanuatu 2023

AdroFx Fastest Growing CFD Broker Asia 2023

Advans La Fayette Microfinance Bank (Advans Nigeria)

Alfa-Bank Belarus

Aljazira Takaful

Alveo Land

Amana Takaful Insurance-SriLanka

Amana Takaful Insurance-SriLanka

Arab Financial Services Company-AFS

Arab Financial Services Company-AFS

Arca Fondi

Best Customer Centric Microfinance Bank Nigeria 2023

Most Outstanding Digital Bank Belarus 2023

Most Leading Islamic Sharia Compliant Insurance Company Saudi Arabia 2023

Best Condominium Developing Company Philippines 2023

Fastest Growing Insurance Company Sri Lanka 2023

Most People-Friendly Insurance Company Sri Lanka 2023

Best New Digital Payment Solutions Provider Egypt 2023

Best Digital Payment Solutions Provider Bahrain 2023

Best Asset Management Company Italy 2023

AsiaPay Best Financial Technology CEO Hong Kong 2023-Joseph Chan

AsiaPay – Malaysia

Most Innovative Payment Solution Providing Company Malaysia 2023

AUCTUS Capital Partners AG Best SME Private Equity Firm Germany 2023

AvaTrade Best Mobile Trading Platform Spain 2023

Winners

Award Title

Banco de Investimento Global Best Investment Bank Portugal 2023

Banco de Investimento Global Best Investment Bank Spain 2023

Banco Industrial, S.A. Best SME Bank Guatemala 2023

BANK OF INDUSTRY Best Development Bank Nigeria 2023

BANK OF INDUSTRY Most Sustainable Development Bank Nigeria 2023

Bank Of Mauritius Best Central Bank Governance Mauritius 2023

Banka Kombetare Tregtare-BKT Best Digital Bank Kosovo 2023

Being She Most Admired Women Empowerment Organization UAE 2023

Bite Investments Best Investment Technology Solution Provider UK 2023

Bite Investments Most Innovative Alternative Investment Fintech Company UK 2023

Bualuang Securities Public Company Limited Best Securities Brokerage Firm Thailand 2023

Bualuang Securities Public Company Limited Most Trusted Investment Partner Thailand 2023

Cardinal Stone Securities Most Admired Non Bank Brokerage Firm Nigeria 2023

Caye International Bank Best Private Bank Central America 2023

China Asset Management Co., Ltd. Best Asset Management Company China 2023

China Shenhua Energy Company Limited Best CSR Energy Company China 2023

CLIMBS Life & General Insurance Cooperative-Philippines Most Outstanding NonLife Insurance Company Philippines 2023

Commercial Bank of Ceylon PLC Best Digital Bank Sri Lanka 2023

Commercial Bank of Ceylon PLC Best Bank for Remittances Sri Lanka 2023

Decode Global Most Outstanding Online Forex Brokerage Company Australia 2023

Dukascopy-Switzerland Best Forex Bank Switzerland 2023

easyMarkets Most Outstanding Multi Asset Brokerage Company UAE 2023

Faraday Venture Partners Most Excellent Venture Capital Firm Spain 2023

Farazad Investments Most Outstanding Boutique Investment Bank Hong Kong 2023

Fast Cover Travel Insurance Best Travel Insurance Company Australia 2023

First Capital Bank Botswana Best Retail Bank Botswana 2023

First Capital Bank Botswana Best Foreign Exchange Bank Botswana 2023

Winners

First National Bank-Zambia

Forex Masters

Best SME Bank Zambia 2023

Award Title

Best Forex Trading Education Company South Africa 2023

Fosun International Limited Best CSR Company Hong Kong 2023

Fosun International Limited

Freedom Property Investors

Genero Capital LLC

HonorFx

Most Influential Family-oriented Consumer Brand Hong Kong 2023

Most Outstanding Property Investment Company Australia 2023

Best SME Financial Advisory Company UAE 2023

Most Outstanding Forex Brokerage Company UAE 2023

HPS Best Payment Technology Company France 2023

IC Markets

ICICI Securities

Best Forex Broker Australia 2023

Best Digital Wealth Management Company India 2023

Ilani Concepts Best Digital Marketing Agency Kenya 2023

JMR Infotech Middle East FZC Most Leading Technology Integrator for Oracle Financial and Enterprise Solutions for Financial Institutions UAE 2023

Joyalukkas Exchange

JSCB Tenge Bank

Jubilee Allianz General Insurance Company Of Tanzania LTD

Jubilee Allianz General Insurance Company Of Tanzania LTD

Most Excellent Foreign Exchange Services UAE 2023

Best International Bank Uzbekistan 2023

Best General Insurance Company Tanzania 2023

Best CEO(General Insurance Company )Tanzania 2023 -Dipankar Acharya

KBC Asset Management NV Best Asset Management Company Belgium 2023

KCB Group

Best Sustainable Bank Kenya 2023

KCB Group Best SME Bank Kenya 2023

KdedeC Consultancy and Traınıng Company

Maybank Investment

Bank-Malaysia

Best Aviation Consultancy Company Turkey 2023

Most Sustainable Investment Bank Malaysia 2023 .

Maybank Securities Singapore Best Brokerage Company Singapore 2023

Maybank Securities Vietnam

MetLife Emeklilik ve Hayat A.Ş.

Metropole Property Strategists

Most Trusted Securities Brokerage Services Vietnam 2023

Most Outstanding Pension Company Turkey 2023

Best Property Investment And Wealth Strategists Company Australia 2023

Winners

Award Title

Mitrade Best Forex Fintech Broker Company Australia 2023

MoneyMatch Brunei Best RegTech Company Brunei 2023

MoneyMatch Brunei Most Leading SME Company Brunei 2023

National Bank of Kenya Best Commercial MicroFinance Bank Kenya 2023

National Bank of Kenya Best Customer Service Bank Kenya 2023

National Development Bank-NDB Bank Best Financial Services Group Sri Lanka 2023

National Development Bank-NDB Bank Best Bank for Sustainable Development Sri Lanka 2023

National Development Bank-NDB Bank Best Financial Institution For Women Empowerment Sri Lanka 2023

Nedbank-South Africa Best Retail Banking Technology Implementation South Africa 2023

Nord FX Most Transparent Forex Brokerage Company UAE 2023

Nord FX Best Forex Affiliate Program South East Asia 2023

Oman Insurance Company(Sukoon Insurance) Best Online Insurance Company UAE 2023

Orbex Most Outstanding Forex Brokerage Company East Africa 2023

Pacific Risk Advisors Ltd. Best ESG Risk Advisory Firm Hong Kong 2023

Pacifico seguros Best Insurance And Reinsurance Company Peru 2023

Petronas Dagangan Bhd Best IR Company (Oil & Gas) Malaysia 2023

Petronas Dagangan Bhd Best Retail Marketing Company (Oil & Gas Sector ) Malaysia 2023

PROMMT Best New Open Banking Payments Solution Provider UK 2023

RealVantage Best Investment Technology Company Singapore 2023

Reassured Ltd Most Admired Life Insurance Company UK 2023

Samuel & Co Trading Best Online Financial Education & Training Platform UK 2023

Sarwa Most Outstanding Fintech Company UAE 2023

smeBank Most Outstanding Fintech Company Lithuania 2023

Stanbic IBTC Trustees Best Trust Company Nigeria 2023

Steward Bank Most Excellent Retail Bank Zimbabwe 2023

Strategic Management Partners, Inc. Best Turnaround Consulting Firm USA 2023

We have entered a new chapter of technological advancement with the emergence of accessible artificial intelligence (AI).

Generative AI models are not only revolutionizing our ability to create language, images, and music, but they are also remarkably accessible to all.

Many of Slalom's closest technology partners are launching impressive AI solutions at an accelerating pace. Large language models like those that power ChatGPT have demonstrated unprecedented abilities to generate human-like writing and write and debug code. Google recently introduced its own conversational AI service, Bard, while cloud technology provides infrastructure to train and move large language models into production systems. A similar surge of innovation is occurring in image generation, with companies like Midjourney Inc. and OpenAI's DALL-E 2 standing out for their ability to create realistic photographs and captivating illustrations based on written descriptions.

The opportunities and risks of Generative AI technologies are unparalleled, as they start to break through several of the last bastions of human uniqueness: writing, creativity, and the arts.

Generative AI promises to bring us intelligence-on-tap: a world in which we can access vast amounts of personalised knowledge and communication at the flick of a switch. The impact of large language models on our lives will be profound.

Industries are rapidly adopting these technologies, with the financial sector being particularly receptive to large language models. Several recently announced examples highlighting this trend: financial data companies are launching their own GPT tools, which are trained on high-quality financial data and news stories. Payments providers have partnered to integrate GPT-4 into their products and services, while financial services organisations have begun using GPT-4 for knowledge management within their Wealth Management tools.

However, there is a very human risk behind every emerging technology: they commonly contain and often amplify inherent biases, passed on from their creator’s own biases and the constraints of technology development. In Generative AI, removing these biases depends on careful selection of the source data used to train the models, and the ensuring diversity in the human reinforcement processes which are later applied to tune their performance.

Intelligence-On-Tap: ChatGPT’s

Intelligence-On-Tap: ChatGPT’s Promise

David Justiniano, ESG, Data, Technology expert, Slalom

In recent years, we have prioritised equitable AI use. The Slalom Ventures accelerator programme, a global initiative supporting impact-focused tech companies, is currently supporting two UK-based startups, PSI and Point Sigma. These startups employ AI tools to enhance the accessibility of focus groups and data analysis.

Another distinctive aspect of the latest AI transition to image/video generation is accelerating pace of evolution in these tools and making it increasingly challenging to keep up with. Tools like AutoGPT enable large language models to prompt themselves and boot up specialised AI agents that can perform various tasks, such as data analysis, statistical model creation, and web browsing. Although implementations are often crude today, the pace of development in this field is relentless. The idea of deploying multiple intelligences simultaneously to coordinate and accomplish a goal - from strategy to plan, projects, tasks, and back to checking goal completion - signifies a new era. Adapting to the concept of intelligence that can be turned on like water from a tap will require radical adjustments.

For these models to achieve widespread adoption, transparency is crucial. Users will need to build their trust in the answers provided by AI and comprehend the steps taken to reach those conclusions. Promising solutions to improve transparency are evident in recent collaborations, such as the one between OpenAI and Wolfram. Wolfram Language, known for its deep logic and mathematical capabilities, has been integrated to ChatGPT as a plugin that enhances problem-solving abilities while detailing the steps taken to arrive at an output.

All organisations need to be thinking of and prioritising the most valuable use cases and impending risks for use of AI. Ensuring they integrate new technologies into their workflows thoughtfully for the benefits of employees, customers, and investors.

The era of intelligence-on-tap is upon us. With the promise of large language models like ChatGPT comes significant potential to build better tomorrows for all. But this potential will not be fulfilled without hard and focused work to ensure risks are mitigated. We must step-up our vigilance on risks and biases these new technologies will bring, and focus on transparency, fairness, and inclusivity, to ensure that the benefits of large language models are shared equitably, rather than exacerbating existing disparities between the most and least privileged.

ENABLING BUSINESS:

How Payments Technology will Boost Businesses’ Futures

As the year has progressed, we’ve seen many of the predictions made at the beginning of 2023 begin to come to fruition. Trends around open banking were solidified when the new finance tech hit a milestone of 7 million users in the UK last month, and more compelling news on instant payments continues to stream through, as the number of instant payment transactions in Western Europe is now expected to grow 5-fold by 2027.

Although it’s great to see the continued growth of these innovative payments technologies, there’s a lack of focus on how new technology is impacting business for the better both now and in the short term. Between open banking, the metaverse, instant payments, and Central Bank Digital Currencies (CBDCs), there’s a lot going on in the payments space, but what are the genuine areas that will see the most development in paytech and how will they affect business?

Accelerating B2B Payments

As digital payments continue to grow in popularity among consumers, businesses have also demonstrated increased adoption to streamline business payments. Digital payment solutions are revolutionising the world of B2B payments, catering to businesses’ needs in a space that has been relatively neglected when it comes to innovation.

As businesses look for new ways to save costs and introduce efficiencies, there’s a renewed focus on eliminating manual intensive tasks, one of which is slow and lengthy invoicing processes. As a result, businesses are looking to technology to address these issues. This means that payments providers who can offer digital payments will be in high demand.

The end advantage of these more streamlined B2B payments processes is efficiency. Businesses won’t get bogged down in making sure that their affiliates, providers

and suppliers are paid properly, allowing day-to-day operations to run smoothly and granting more time to focus on more crucial matters.

Making Real-Time a Reality

The ways in which businesses move and receive money digitally is becoming outdated. Businesses are realising that these processes are also expensive, slow and leave their customers, as well as themselves, more vulnerable to fraud.

In light of this, instant payments have seen huge investment and support from Big Tech, in addition to becoming embedded into non-financial apps and other digital services. As open banking and other real-time payment options develop, 2023 will be an exciting year for digitisation opportunities, including at point of sale and in B2B.

Indeed, as I touched upon earlier, open banking and other instant payment technology has already reached new milestones this year,

Nick Corrigan, President, Europe, Global Payments

and so businesses can start to expect a much wider variety of real-time payments options to become available. The benefits of this will be game-changing for many SMEs, allowing payments to be complete in a matter of seconds, greatly improving efficiency and reducing the risk of fraud.

The Physical and Digital Become One

2023 is seeing the physical and digital spaces complete their merger into omnichannel, meaning that consumers will cease to view the virtual and physical worlds as separate, but rather two spaces that flow seamlessly between one another. This marks a huge opportunity for many companies to capitalise upon.

Stadiums and events, for example, are primed to adopt more digital ways of engaging with fans, branching out beyond simply offering virtual tickets, but enabling the whole payments experience at events to run digitally, e.g., ticketing, merchandise,

food and beverage and even parking. Another hybrid area to watch is social commerce, where consumers can immediately buy what they see without leaving an app or platform, reducing the steps to purchase significantly.

Disciplined posture toward new technologies will prevail

Though efforts to create dramatic advances in technology will always receive attention, higher interest rates and the crypto crash–among other factors–are forcing a more disciplined posture toward new technologies in 2023.

We can take the metaverse for example. Commerce opportunities in the metaverse depend on whether consumers will flock to digital worlds or if uptake will have a longer runway. As large improvements continue to take place, companies will likely view the metaverse as an extension of their ecommerce strategy, however we may not see a single large-scale rush towards it.

Similarly, we’re likely to see more regulation of Buy Now Pay Later (BPNL) to stabilise and protect consumers. What’s more, it’s fair to say that successes in crypto will occur via effective use cases. For example, stablecoins, blockchain technology and CBDCs are more probable winners in the near term because there are real use cases where they can be put to work on a regulated, reputable and compliant basis.

Ultimately, the market’s continued trajectory down this cautious route regarding furthering innovation, in addition to enhanced efficiency-boosting paytech in both the B2B and B2C spaces, spells good news for businesses, and should encourage them to invest in bringing their payments infrastructure up to date for the benefit of both themselves, and their customers. All these factors are enabling businesses to increase their competitive edge and improve customer loyalty by providing safer, more streamlined and positive payment experiences.

How financial services can fortify digital banking with identity security

When many of us picture a ‘bank robbing’ swindler, often the first image that comes to mind is one of a masked man in stripey clothes accompanied by a bag of overflowing cash. However, the days of masked crooks stealing the limelight are long behind us.

In today’s digital era, modern criminals hide behind the masks of their computer screens and go undetected,

often by duping or impersonating others. Money is still the prize possession but sensitive data is also seen as an opportunity for huge financial gain.

This comes as over 9 in 10 (93%) financial service firms have faced an identity-related breach in the last two years, according to our State of Identity Security report Ransomware and malware attacks are the most common (at 43%), while breaches across the board are becoming more frequent - almost three quarters (72%) of

all organisations surveyed highlighted that the number of breaches has increased in the same time frame.

With the Bank of England warning that cyber attacks pose the biggest risk to the UK’s financial system – which is estimated to be the target of over a quarter (28%) of all UK cyber attacks last year – it is crucial for financial institutions to focus on planning their response to spot suspicious behaviour, minimise disruption and contain fallout.

Why identity management matters

The financial sector is under constant scrutiny to ensure the highest standards of security and compliance, as breaches can lead to severe repercussions. Given the high stakes involved, banks and credit unions are inherently risk-averse and subject to strict regulatory frameworks. The rapid evolution of digital banking – where banking is no longer contained to the four walls of the building – is driven by mobile technology, blockchain, and Banking-as-a-Service (BaaS). This has increased cyber threats, compliance requirements, and the need to address security gaps.

To complicate matters, the financial sector faces challenges such as high rates of insider data breaches, complex corporate structures, and reliance on manual processes for tracking data access and user identities, making it vulnerable to inaccuracies and inconsistencies.

Financial institutions must look towards adopting a proactive approach in managing risks associated with handling sensitive data, while continuously monitoring and assessing their security posture, leveraging advanced cybersecurity solutions, and fostering a culture of security awareness among their employees. Through utilising artificial intelligence (AI) technologies, financial institutions can ensure identity security can be upheld while mitigating the risk of devastating breaches and ensuring compliance with regulatory requirements.

Identity security as a frontline defence

With cyber criminals becoming smarter in their tactics, using the transition to the digital world to their advantage, the financial services sector needs to stay one step ahead – the key to doing this lies in a strong AI-based identity security strategy. Encouragingly, financial institutions understand the importance of this. According to our State of Identity Security report, 100% of all surveyed finance IT and IT security decision makers say that identity security is either a relatively important, critical, or the number one investment priority for their organisation, with over half (56%) having fully implemented a programme that has been in place for less than two years and less than a third (29%) having fully implemented a programme that has been in place for more than two years.

Despite many financial sector organisations being ahead of the game when it comes to AI-powered identity security, there is still progress to be made - with 91% of financial services businesses suggesting that they have experienced challenges when it comes to adopting identity security. Some of the most frequently cited difficulties include integration flexibility (38%), high configurability (35%), and complex implementation (32%).

AI-enabled identity security is vital in allowing organisations to see, manage, control, and secure all variations of identity – employee, non-employee, bot or machine. AI-enabled tools are also crucial in helping organisations to know who has access to what, and why across their entire network – detangling the sometimes-messy web of access management.

Financial organisations also need to be aware of the internal, insider threats that may not be at the hands of data seeking cyber criminals and could be due to an innocent employee mistake. In today’s modern enterprise, nearly half of workforces comprise a variety of

non-employee, third party identities – meaning different individuals, all with different access requirements, are tapping in and out of networks, often unchecked. Without proper visibility and protection in place, organisations are leaving themselves vulnerable in the face of attack.

AI-based identity security provides organisations with clear oversight into who is entering their internal systems, helping them to spot unusual patterns or behaviours well ahead of a breach occurring. This oversight helps organisations to detect and remediate risky identity access and respond to potential threats in real-time.

Laying the groundwork for the future protection

As banks and other financial services continue to ramp up their digitisation efforts, they must in turn invest in their cyber defences to keep up with the evolving threat

landscape, ensuring they are ready to adapt to changing market demands and maintain the highest levels of security and compliance.

The growing complexity of digital banking and the increasing volume of cyber threats require skilled professionals who can manage and protect sensitive data effectively. However, financial institutions often struggle to find and retain qualified cybersecurity and identity management experts. By implementing comprehensive identity security solutions, banks and credit unions can automate complex tasks, reducing the need for specialised personnel, and enable existing staff to focus on more strategic initiatives. This, in turn, can help financial organisations to efficiently allocate resources and maintain a strong security framework.

Ensuring proper separation of duties (SoD) is critical for preventing fraud and maintaining compliance with regulatory requirements. However, managing SoD policies can be challenging due to the complexity of financial institutions' organisational structures and the need to coordinate access controls across multiple systems. Identity management solutions can help streamline the management of SoD policies by automating access controls, monitoring user activities, and providing real-time visibility into potential conflicts. This allows financial institutions to effectively enforce SoD policies, reduce the risk of unauthorised access or fraud, and eliminate compliance gaps.

The importance of identity security in the financial sector cannot be overlooked. As we move further into the digital age, identity security will be the key to futureproofing and protecting banking organisations from cybercrime. By leveraging AI-enabled identity security, organisations can have complete visibility over who is entering their internal systems, managing access to those systems whilst ensuring the protection of sensitive data. This is a necessity if businesses wish to fully protect themselves from the malicious cyber criminals of the digital age.

Steve Bradford, Senior Vice President, EMEA, SailPoint

IMPROVING CONSUMERS’ FINANCIAL HEALTH THROUGH BUILDING AWARENESS AND TRUST IN OPEN BANKING

Ongoing economic turbulence continues to put a squeeze on the public’s personal finances – from lower-rate mortgage deals being pulled to the sharp rise in everyday items and bills. Indeed, figures from ONS found that around two-thirds (67%) of adults believed that their cost of living had increased in May, with 97% of respondents seeing an increase in the price of their food shopping compared to April.

With personal finance at the top of people’s minds, financial service providers are understandably in the spotlight. But, unfortunately for them, they’re not in the good books of half of the population.

In our latest State of Payments report, data revealed that over half (53%) of consumers do not believe that their finance needs are being met. And yet, only 2% of people say they have started looking for new products – suggesting that many may be stuck in a financial rut.

But why is this the case? Well, we discovered that the problem is two-fold. There’s a lack of awareness from consumers about how financial products and services can improve their financial wellbeing. And there’s also an issue with trusting the unfamiliar. Let’s delve into these a bit further…

Sticking to what they know

Consumer trust continues to be a thorn in the side for financial services providers. In our report we identified trust as a key factor for consumer decision-making. In fact, most consumers say that they only trust products and services they have heard of or are recommended by family, friends and colleagues. From concerns around whether these providers have their best interest at heart, to overselling products and services that aren’t well suited to a customer’s needs, a low level of trust between consumers and financial services remains in place.

However, consumers would be open to securely sharing more of their personal data with financial services organisations, like their bank or with a personal finance app, if it improved their financial wellbeing. This includes services that encourage saving and budgeting for long term financial goals such as a mortgage and building credit scores.

And yet, this is in contrast banks and fintechs, as almost one-third (30%) of decision makers in financial services organisations indicated that trust in data sharing is the biggest barrier they face as a company in driving the adoption of their services and products powered by open banking, despite consumers saying that they are willing to share their personal data.

Stefano Vaccino, founder & CEO, Yapily

Awareness is at the heart of the trust issue

So, there is clearly a disconnect here: consumers are fed-up with their financial situations but aren’t putting trust in financial service providers to help them improve their financial wellbeing with new services and products powered by open banking.

And why? Well, our report found that consumer awareness of open banking remains low, with a quarter of respondents stating that they do not know enough about it and are wary of the technology. This lack of understanding around open banking and the ways it can benefit personal finances, presents as a missed opportunity for both consumers and financial services providers.

Bridging the gap

It’s important that financial service providers overcome the issues around awareness and mistrust, and build consumer confidence in

open banking powered products that will support their financial wellbeing. By having access to better and fairer financial products, these positive experiences will be crucial in raising broader awareness of the benefits of open banking, and eventually increase its demand. But how can this happen?

There are many misconceptions surrounding data privacy and security, which have contributed to consumers distrust towards financial service providers, and in turn open banking. Sharing financial information that was once only available to notoriously highly regulated banks, naturally raises questions about privacy. But this thought process can and should be dispelled. Pay by Bank is one of the most secure payment methods and there's a reason why: it was a top priority when PSD2 was drafted, so banks and fintechs are required to use highly secure and encrypted APIs. To access data in the first place, a service provider needs consumer consent and cannot access without it. By dispelling some of these myths on data privacy, this will help ease worries and build trust around open banking.

Final thoughts

People are used to what they know, right? But by raising awareness of the benefits of open banking and its impact financial wellbeing, we can start to change consumer perceptions. For example, explaining that it's easier to track spending and budgets more effectively when bringing all bank account and credit card information into one personal finance app, would make consumers consider using open banking products as part of their financial management.

But it will take the combined effort of the financial services sector, regulators and the Government to ensure that open banking can become as mainstream as traditional forms of banking. As consumers across the UK continue to grapple with the current economic uncertainties, it is vital that they have the right products and services to best manage their personal finances and improve their financial wellbeing –so let’s all work together to make it happen.

BANKING ON THE CHATGPT CRAZE

With announcements about new gains Generative AI models have made coming daily, the question financial institutions are left with is how to apply it safely.

For an industry that thrives on balancing risk and reward, completely ignoring this much hyped tech will not be an option forever. According to the Gartner Financial Services Business Priority Tracker Survey from February 2023, disruptors are

already investing in the new technology, the biggest brands are closely monitoring the situation, and the largest group is waiting for certain improvements.

The wait-and-see approach seems sound with so much in flux. Starting with regulatory requirements, there’s a lot of discussion from the supra-national to industry levels about how these new generative technologies need to be regulated. With at least one country considering a complete ban and high-level technologists sounding warnings, it’s hard to know what investments might be lost if they don’t comply with coming legislation.

Even if we stick to existing laws, in the UK the FCA’s Consumer Duty regulations require explanation in decisioning and proof of compliance, neither of which are possible with today’s LLMs in charge of customer communications.

Then there’s the lingering downsides, I’ll go into a few of the big ones:

1. Hallucinations: This is the polite way to say that the responses ChatGPT and other similar predictive models generate are those of a confident liar. Even if you were to train it exclusively on your company’s data, there’s no known way to ensure it always sticks to the truth. Specific styles of prompt engineering tend to yield more truthful results, particularly after a few turns, and there may be ways to catch the bulk of hallucinations with post-processing, but there’s no known way to control the content completely on its own.

2. Black box: Because of the ways the AI trains itself, even its developers don’t always know why it’s made certain decisions or even all that it’s

Cheryl Allebrand, CGI UK, Managing Consultant, specialising in Conversational AI & Automation

capable of. Equally, companies behind the big models haven’t been transparent with users about what data was used to train the models – including whether or how the data your use of it generates will be utilised. This missing information hampers risk assessment and leaves serious security questions.

3. Old news: Depending on the model, the latest information it has access to could be years old. This can lead to outdated answers and lower chances of understanding questions that incorporate new terms or ask about more recent events.

4. Lack of context: Despite their ability to communicate convincingly, these models don’t understand what they are being asked and don’t have access to the same context clues that we do, leading to confusing responses that might not be wrong per se, but that aren’t correct for the situation.

However, for all the drawbacks, the potential upsides may prove too tempting to ignore, and steps for safer implementations could reduce risk enough to make it worth it.

Content creation/adaptation for marketing is one area where generative technologies can be used in a hands-on way by people, making it safe while saving enough time and costs to be irresistible. Marketing can be customised to niche groups or completely individualised without an undue amount of effort.

This individualised approach could also be employed during onboarding to help meet regulatory requirements like the UK’s new Consumer Duty outcome of consumer understanding. Use in response creation – both to tailor the wording to the

correct reading level or primary language of the individual, and to determine whether they understand the product and the implications of sign up are both valuable endeavours that aren’t feasible at scale without technology’s help. Again, use here should be as a timesaver and any responses it generates should be checked before use.

The not-quite-ready-for-prime-time tech might not be suitable for unmediated customer-facing interactions, but behind the scenes it can shine, especially in these two important areas:

1. Fraud detection: These models have been used to determine the probability that they have been used to generate a text. In a less meta-application, they could be employed to detect other types of potential fraud.

2. Data extraction and insight: Developments in tech, including the right application of Generative AI, open a whole new realm of possibilities when it comes to extracting insight from data. Including having more data to work with. For example,

when analysing old call recordings, instead of sampling only a fraction of calls manually, adding LLMs into the mix make it feasible for companies to gain full insight into what customers most frequently ask for, along with how they ask for it and the corresponding agent responses as well. By automating the bulk of categorisation and labelling work and learning the words and phrasing customers are using enables training of company NLP for better recognition. LLMs are great at figuring out alternate phrasings, to further improve recognition rates.

Whether you decide to dive right in, test the waters, or wait for the calm before investing, make sure you:

1. Explore behind-the-scenes rather than customer-facing use cases

2. Employ it alongside people to enhance their expertise or enable faster execution – don’t leave it on its own

3. Test thoroughly. Only then, can you ensure your investments are sound, make sense, and offer value without compromising security.

TOP 5 AI USE CASES FOR QUANTITATIVE TRADING

In recent years, the finance industry has undergone a transformation with the advent of Artificial Intelligence (AI). Among the various areas where AI has made a significant impact, quantitative trading stands out. By utilising algorithms to analyse vast amounts of financial data and make trades based on patterns and trends, AI has revolutionised this field. While

statistical methods have long been used in finance for data analysis, the growing complexity and volume of financial data have made it imperative to incorporate AI methods. These cutting-edge techniques provide more nuanced insights and a deeper understanding of the data. Here are some top AI use cases in quantitative trading that can drive higher ROI and enhance productivity.

1. Financial Sentiment Analysis

Generative AI has greatly enhanced businesses' capacity to comprehend and analyse textual data, such as news and social media sentiment. Leveraging sophisticated transformer models like GPT-3, AI-powered sentiment analysis has become more precise and effective, empowering traders to make well-informed decisions based on up-to-date data in real-time.

If a trading team aims to base their trades on news and social media sentiment, they can employ AI-powered sentiment analysis to analyse various content, such as news articles and social media posts, to determine whether the sentiment is positive or negative. For instance, if the sentiment surrounding a specific company is positive, the trading team may opt to buy stock in that company. Conversely, if the sentiment is negative, they may choose to sell their holdings. By utilising AI-powered sentiment analysis, the trading team can make better-informed decisions based on real-time data.

2. Trading Pattern Recognition

Automated trading utilises AI algorithms to automatically execute trades based on predefined patterns or rules. For instance, let's say a trading team desires to make trades based on a stock's price movements between 9:30 a.m. and 10:00 a.m. daily. Using AI-powered pattern recognition, the team can identify this pattern and automatically execute trades during that time window. By automating their trading strategies, the team can save time and enhance their overall efficiency.

3. Accelerate Algorithmic Trading

High-frequency trading is characterised by ultrafast trades aimed at exploiting small price fluctuations. AI-powered algorithms are capable of analysing massive amounts of data and executing trades with superior speed compared to human traders. For instance, an algorithm can swiftly analyse data on a stock's price movements and automatically execute trades based on identified patterns or trends. By leveraging AI-powered algorithms, the trading team can conduct a higher volume of trades in a shorter time frame, potentially leading to increased profits.

4. Detect Market Anomalies

Challenges have arisen for trading teams in reconciling daily securities pricing, with a majority of exceptions requiring review despite not being true anomalies. To tackle this issue, trading teams can use AI-powered algorithms that utilise historical data spanning multiple years to swiftly build machine learning models. By tracking the movements of a particular stock against other securities, AI can identify anomalies and alert an analyst to review them. This approach not only minimises exceptions but also eradicates the need for manual effort, thus improving efficiency and accuracy for trading teams.

5. Risk Management

Managing risk is a significant challenge in trading, and AI-powered predictive modelling can aid traders in identifying potential risks and gauging the probability of events occurring. For instance, consider a quantitative trading team that has invested in the energy sector and seeks to anticipate the risk of a future decline in oil prices. To achieve this, the team can leverage AI-powered predictive modelling to analyse historical data on oil prices, supply, and demand. The AI algorithm can discern patterns and trends in the data, enabling it to predict the likelihood of a future drop in oil prices. Based on this prediction, the trading team can make strategic adjustments to their portfolio, such as reducing their exposure to the energy sector or diversifying investments into other sectors, to mitigate potential losses.

The bottom line

Each of these applications can have a significant impact on ROI by mitigating the risk of losses, increasing the frequency of profitable trades, and optimising returns while minimising risk. Additionally, the utilisation of AI in quantitative trading can yield cost savings and enhance productivity by automating trading strategies, expediting and streamlining trade executions, and optimising asset management. Through the integration of AI-powered tools, trading teams can make well-informed trading decisions, resulting in higher ROI with improved precision and efficiency.

Leslie Kanthan, Co-Founder and CEO, TurinTech

Goldman Sachs has warned that the Bank of England could raise interest rates to 5% this summer as it battles to bring down inflation. The combination of rising interest rates and inflation, coupled with price hikes, has caused substantial challenges for businesses, particularly for SMEs that have been hit the hardest.

Businesses are already hurting. In December 2022, Lloyds conducted a survey with over 1,400 SME leaders and found that 82% said the rising cost of living was having a negative impact on them, with two-thirds (61%) reporting that inflationary pressures had caused their supplier service to worsen.

In this turbulent, uncertain economic climate, business plans may start to appear more decorative than decisive. To view them as such would be a mistake. A considered business plan becomes even more crucial when the future looks worrying.

So why do business plans matter and what goes into the strongest ones?

DO BUSINESS PLANS EVEN MATTER IN TURBULENT ECONOMIC TIMES?

Why should you have a business plan?

As businesses navigate unfolding economic uncertainty, having a business plan is a lifeline. A study in the New England Journal of Entrepreneurship found that entrepreneurs with a business plan are more successful than those without one. Having a well-crafted business plan can assist in goal setting, identifying potential roadblocks and the ability to navigate complex business issues as and when required.

They provide businesses with a clear roadmap to achieve their goals and objectives and is an invaluable strategic tool. It helps them to identify their strengths, weaknesses, opportunities, and threats (SWOT), a common strategic planning technique to help assess key factors that might affect your business.

In some cases, businesses will often require a business plan before they consider reaching out to investors or even receiving a loan and so it can help them secure funding by demonstrating their potential for growth and profitability - something that many are struggling with in the current climate. The benefits of having a well-versed business plan speak volumes to investors and stakeholders alike and can distinguish the business from its competition.

What makes a strong business plan?

Every business plan will be unique but all good plans will have these key things in common.

1. Clarifying the purpose and goals of your company

Firstly, an SME needs to sit down and define its purpose and business goals. The foundation of a solid strategy depends on answering the ‘why’ and ‘what’ of your business. Why does your business exist? What is its purpose? Establishing this gives your business a guiding light through challenging times and benchmark to measure all business decisions against. Similarly, objectives explain what it is your business wants to achieve. Again, establishing your main objectives in your business plan helps to give further guidance for important decision making.

2. Engage in market research

Being informed is fundamental. After deciding your business goals, the next is to conduct thorough market research to identify the target audience, competitors, and industry trends. This information will help SMEs understand their market position, customer needs, and how they can differentiate themselves from competitors.

3. Formulate a communications strategy

Your communications strategy will help you reach your target audience in the most direct and impactful way possible. You’ll need to identify the best channels to use and the appropriate methods of communication for each. Your goal might be to raise general awareness of your brand, build credibility and reputation or simply drive sales - the strategy will lay out how you’re going to achieve this.

4. Establish your financial plan

One of the most scrutinised parts of your business plan will be your financial plan. Though current economic circumstances may make predictions difficult, being vague here will only do you a disservice. Plus, all businesses will be facing uncertainty. Your financial plan should include projections for revenue, expenses, and profits, as well as an analysis of the funding required to start and grow the business and how you intend to raise it. This part is of particular interest to investors, so the more detail the better.

5. Set up an effective tech stack

It’s wise to also plan what tools and technology you intend to use to fulfil your objectives. The technology that will be of high importance to the day-to-day running of your business will be critical to establish early on, not

only from a cost perspective but for their impact on security and compliance, for example. From customer relationship management tools, to a cloud-based business phone system for internal and external calls, finding the best tools for the job and defining the processes around them will become invaluable as your business grows.

Using your business plan long term

Business plans give businesses the structure and stability they need to withstand the winds of uncertainty. A well-defined, detailed plan enables them to make fully informed decisions as well as attract new investors, raise funds and assess their own progress. Remember that business plans aren’t set in stone and will need to adapt and evolve with your business, so you should expect to continually revisit it and not just dust it off for investors.

Business plans are the bedrock of better decisions. In these economic circumstances, no organisation can afford to ignore them.

- Damian Hanson, Co-Founder & Director, CircleLoop

- Mike Ferguson, President, EMEA at Redpoint

A Golden Record and a Personalised Banking Experience

I’m sure I’m not alone in my frustration when trying to dial into my bank on being pushed through an automated IVR which appears to have the sole objective of not letting me talk to a real person. Rather, it directs me to an informational webpage while a recorded voice tells me that the bank values my call.

Personalised experiences are often thought of in the context of retail and fast-moving consumer goods (FMCG) companies, whose customers are accustomed to a brand knowing them across channels. Whether online or in-store, engaging with a call centre or customer service, customers expect the brands they interact with to know they’re the same person and to receive a personalised experience that

demonstrates such an understanding.

The same expectation now applies to the global banking industry. In fact, in a recent research report from Capco, 72% of customers said that personalisation in financial services is “very important.”

Banks face challenges meeting customer expectations largely because technology limitations greatly hinder a business’s ability to effectively utilise customer data to gather a complete understanding of the customer across an omnichannel journey. A lack of data unification from a dozen or more complex and fragmented legacy systems results in siloed data that makes it impossible to develop a single source of truth for a customer or household across different product lines or channels.

When a customer searches your website for information about savings accounts, are you able to personalise the session for a first-time visitor? If that same customer then contacts the call centre, will the agent know about the online session or a branch visit, or will the agent use a script to try to upsell a home improvement loan?

Meeting the customer with a relevant experience in real time across an omnichannel journey – such as with accurate product recommendations or a nextbest action that factors in a customer’s full behaviourial history – depends on having a unified customer profile, also known as a Golden Record. More than a single source of truth, a Golden Record combines data from every source (website, mobile app, eCommerce platform, Pos, CRM,) to form a holistic, unified record of a customer and the customer’s engagement with a brand across every touchpoint. Including behavioural, transactional, demographic and preference data, a Golden Record contains all attributes, all aggregations, a full identity graph and a full contact history. It puts everything knowable about a customer or household into a single place and is the foundation of data-driven insights that make a personalised customer experience (CX) a reality.

A true Golden Record will apply data quality processes at the precise moment of data ingestion, an important consideration to be able to deliver relevant experiences to a customer in real time as the customer journey unfolds. Because a Golden Record will eliminate duplications, discrepancies and inconsistencies, banks can analyse customer behaviours, preferences and transactional history to identify cross-selling and upselling opportunities, tailored financial advice with confidence and trust in the DNA of their data.

Unlike retailers and FMCG companies, banks have more stringent regulations around protecting personally identifiable information (PII). One important consideration before building a Golden Record is to ensure that it can be deployed within an organisation’s own cloud, ensuring PII does not leave the safety of an organisation's firewalls.

Keep Pace with the Customer

With insights derived from a Golden Record, banks are able to analyse customer data to identify patterns, trends and correlations that can inform product development, marketing strategies and customer engagement initiatives. Such a data-driven approach allows banks to stay ahead of customer expectations, optimise their offerings, drive business growth, and remain competitive and compliant with regulatory requirements.

Banks have been driven by product and or channel-based profit and loan (P&L) statements for too long, where each product or channel would try to sell each customer according to its own interests. Changing expectations for personalisation in banking make it imperative to put the customer at the centre of the experience. A connected customer experience considers and makes offers that are in the context of an individual’s current situation to include life stage, household dynamic, income and debts.

A new empty-nester may be looking to downsize and is in the market for a mortgage, for example, while parents with young children need to finance a move to a bigger flat. The power of the Golden Record makes it possible to orchestrate a connected experience with fine-tuned offers, messages and content that are in the proper sequence according to individual customer needs and that are on the right channel at the right time.

For financial institutions large or small, creating a single source of truth through a Golden Record is an important first step toward meeting demands for seamless, personalised and digital-first experiences.

Hiring and growing in an uncertain market

The facts are clear: tech workers can no longer be bought with high salaries and pizza Fridays. In an uncertain economy, workers’ focus is squarely on money and affordability, taking a savvy approach to what they earn and what they spend. Now more than ever, top talent want the opportunity to work on interesting and scalable solutions that have real impact for their customers.

At Payhawk, we’ve implemented an approach that communicates exactly what our offering is to new recruits that will get them excited to join, and become committed to the company’s mission and journey, above and beyond free breakfast bribery.

The perks of offering perks

Tech has long been known for its inclination towards enticing talent with

perks. From free breakfast to beer Fridays, small companies at seed stage that are yet to turn a profit, will typically end up offering perks in place of high salaries.

Perks can differ in their approach, particularly in relation to whether a staff member is office-based or remote. Post-covid, there are more online perks: staff receive a budget to use at their discretion - spent on

anything from childcare to house-cleaning - appealing to the needs of a remote worker. For those still going into an office, they may prefer a travel allowance, or gym membership. Although these quotidian perks may look appealing on a job advert, they are no longer enough to entice the best talent to the leading tech companies of the future.

When perks start to hurt

The employers’ arms race to offer the best perks has resulted somewhat in a counterproductive activity of ‘keeping up with the Joneses’. Unfortunately this can backfire when disgruntled employees see their competitors enjoying better brunches, or attending more exciting company trips. Worse than this however, are problems of scalability. A company of 30 people can offer free breakfast, but at 300, this could become untenable and removing perks will negatively impact morale.

The shift from perks to benefits

Not all staff want to be wooed by perks, and will instead opt towards interrogating their future at a company. At Seed stage companies, potential new hires may ask for more security by interrogating the runway of the business, or asking questions about future funding; when to expect another raise, who future investors might include and where the company could expand.

When companies move on from Seed to Series A and B, staff will look more at the product; where engineers are based, who their investors are; interrogate the total addressable market, and what the equity opportunities are, because that company is now no longer a startup in need of enthusiasm but, like Payhawk, an established business with huge commercial potential.

Hiring and retaining staff

There is a way to create a balance that includes benefits, but also gives meaningful incentives for an employee to commit. Offering a commute allowance, health insurance, pension, or salary sacrifice are all great benefits, but the fight for the best talent should never be about perks. We want our employees to join and stay at Payhawk for our product, the knowledge and experience they will gain, and the team they work alongside. Communicating the kind of office culture to potential employees is the best start you can offer.

This can include effectively communicating working practice, for example, remote companies seeking those happy with fully remote work, or clarifying fully in-office work.

It’s important to be honest about business practice from the outset. By asking candidates about their current setup, the location they are based, and whether it’s work from home, it will help to align expectations and source the most suitable candidates.

It’s also important to explain the company’s current output and future roadmap to employees, who are often -- especially in early-stage companies that have issued share options -- shareholders in a business. This transparency is a key part of retaining staff commitment. When one of the most important perks is equity, staff who are even one step away from strategic decisions will want to know what’s happening company-wide and the impact of all their hard work.

If you trust your staff enough to give them a piece of the business, then you should entrust them with the knowledge of the company’s direction. They will begin to think like business owners, rather than treating it like a 9-5, which is of huge benefit to the business in return. The risk that staff have taken in joining a growing tech company is respected, and they are treated as part of it from day one.

Hristo Borisov, CEO and co-founder, Payhawk

Why Organisational Alignment Is Key to Achieving Personalisation Maturity in Financial Services

Customer experience is everything –in fact, 61% of people are unlikely to return to a brand that does not provide, at minimum, a satisfactory one . And when it comes to experience, personalisation is crucial; 72% of consumers rated it as “highly important” in today’s financial services landscape.

Key to delivering the relevant, convenient, and seamless interactions consumers expect, financial institutions (FIs) have already identified personalisation as a strategic priority. But despite the best intentions to invest more in the practice, there’s a simple reason many will fail: differing opinions on what personalisation maturity looks like within the organisation.

Key findings

To better understand the current challenges and opportunities of personalisation in the

industry, Dynamic Yield surveyed FIs around the world, asking stakeholders in digital, customer experience, product, and marketing across levels how they measure their organisation’s personalisation maturity.

According to the research, FIs globally understand the benefits of an individualised customer experience (86%) and plan to invest more in personalisation (92%). But there’s a clear discrepancy in responses from middle management compared to the c-level – 42% of executives felt that personalisation was already a part of the organisation’s DNA, but just 27% of senior managers and 19% of middle managers agreed.

This discrepancy was also clear with regard to opinions on resource allocation to personalisation initiatives. The research showed that 25% of middle managers felt that resources for personalisation were limited, as opposed to just 15% of executives.

Reference: The US Customer Experience Index - Forrester Report 2018

Insights for Investments to Modernise Digital Banking - Capco Research 2021

Organisational alignment is key

Ultimately, closing the maturity gap within the organisation requires proper, through-level alignment.

Strategic Direction and Vision: Personalisation initiatives should be driven by an established vision and a clearly defined strategic roadmap, with buy-in from key stakeholders, including those in the c-suite. With a common vision, executives can leverage a unified understanding of the desired outcomes and objectives for the organisation at large. C-suite emphasis on personalisation ensures that efforts are not fragmented, but rather centrally integrated in the overall business strategy.

Resource

Allocation and

Investment: Beyond clear objectives and goals, effective implementation requires a substantial investment in technology, data analytics capabilities, and skilled personnel. With c-suite alignment, leadership can properly distribute resources and make investment decisions that directly support personalisation initiatives – allocating the necessary budget and resources required for data collection, analytics platforms, AI technologies, and talent recruitment. Executive buy-in and support are crucial to successful implementation.

Data Governance, Compliance, and Integration:

Effective personalisation hinges on the ability to collect, analyse, and leverage consumer data across touchpoints. A robust data governance and implementation framework enables

responsible data usage, and ensuring compliance with data protection regulations and maintaining ethical standards is of utmost importance. From there, aligned data collection methods, privacy regulations, data sharing protocols, and data integration practices minimises silos and unlocks a holistic view of the consumer, key to delivering better, more tailored experiences that retain the company’s reputation and consumer trust.

Consumer-Centric Culture: Achieving personalisation maturity requires a consumer-centric culture that permeates throughout the organisation. The c-suite plays a crucial role in championing consumer-centricity through messaging, actions, and performance metrics, which influence employees at all levels to prioritise personalisation efforts. In a consumer-centric culture, personalisation becomes a core value that drives continuous improvement and innovation in experiences.

Technology Integration and Collaboration: FIs must prioritise their technical infrastructure – facilitating cross-functional collaboration between IT, marketing, operations, and other relevant departments will achieve personalisation maturity. With proper integration, executives can overcome organisational silos, break down barriers to information sharing, and foster collaboration. Proper technical integration of customer data, analytics platforms, CRM systems, and marketing automation tools, creates a cohesive technology ecosystem.

Becoming a personalisation pioneer

With consumers shifting primarily to digital banking solutions and believing that product offers are more valuable when tailored to their individual needs, the vast majority of global FIs have paid notice, identifying personalisation as a top priority, with plans to invest more in the practice.

However, gaps in the perception of programme maturity between career levels complicate maturity ratings – FIs broadly have a long way to go to advanced personalisation maturity that will positively impact the business.

Greater organisational alignment must be achieved around the overall approach to customer journey work and personalisation: from the team, company structure, and executive support put in place all the way to the data practices, roadmap building, and testing guidelines.

The end goal is to establish a programme that is unified in its vision, execution, and continued optimisation – only then can FIs call themselves personalisation pioneers.

Harry Hanson-Smith, RVP at Dynamic Yield, a Mastercard company

Move forward with us and invest in the future

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