Absa Regional Operations Retail and Business Banking: a digital bank for Africa www.fintechmagazine.com
AUGUST 2020
Building a cloud banking platform
REINVENTING BANKING Conor Fennelly, Founder and CEO, explains how LEVERIS’ innovative, cloud-native platform is reimagining the future of banking
Women in FinTech
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FOREWORD
W
elcome to the August edition
In addition, we also got to speak with
of FinTech magazine.
other tech innovators around the world,
It takes a tremendous amount of
including Absa Group and Atom Bank.
time, dedication and effort for a com-
Elsewhere in the issue, our editorial
pany to perform at the top of its game
team explored some of the most influ-
in the financial services world; it’s a dis-
ential trends affecting FinTech today:
tinction that only a handful achieve, yet
AI, the importance of a digitally-focused
there are some capable of taking it a
workplace culture, the use of virtual
step even further and actually reinvent-
reality (VR) and augmented reality (AR)
ing an aspect of the industry.
in payments and look inside the
Conor Fennelly, Founder and CEO of LEVERIS, spoke with us and explained
RegTech revolution. For our Top 10 this month we pay
how his company accomplished just
tribute to some of the most influential
that: a reimagining of the banking expe-
women in global FinTech. With a range
rience through technology. A highly
of backgrounds, career experience and
experienced tech entrepreneur whose
industry focuses, they are a reminder
resume includes a 20-year stint in
that success in this fascinating industry
Silicon Valley, Fennelly‘s background
takes many forms.
reflects a long-term focus on innovation and deep insight into how to run a high-growth startup. Reflecting on LEVERIS’ mission to correct problems in the banking sector, he says, “it’s not
Enjoy the issue. Will Girling
so much a case of banks failing their customers, but more a case of technol-
william.girling@bizclikmedia.com
ogy failing banks. The systemic problems facing banks can be addressed almost entirely via technology.” f i nte c hma ga z i n e. com
03
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05
PUBLISHED BY
Owen Martin
Jake Megeary Jordan Hubbard
DIGITAL VIDEO PRODUCERS
MEDIA SALES DIRECTOR
PRODUCTION MANAGER
Will Girling
Kieran Waite Sam Kemp
James White
EDITORAL DIRECTOR
MARKETING DIRECTOR
Jason Westgate
EDITOR-IN-CHIEF
DIGITAL MEDIA DIRECTOR
Matt High CREATIVE TEAM
Oscar Hathaway Erin Hancox Sophia Forte Sophie-Ann Pinnell
Leigh Manning
CHIEF OPERATIONS OFFICER DIGITAL MARKETING MANAGER
Shirin Sadr
Stacy Norman PRESIDENT & CEO
DIGITAL MARKETING EXECUTIVE
Glen White
Evelyn Howat
PRODUCTION DIRECTORS
Georgia Allen Daniela Kianickovรก
PROJECT DIRECTORS
Andrew Stubbings fintechmagazine.com
10 26
Payments innovation in the new world
38
BUILDING A RESILIENT, DIGITALLY-FOCUSED WORKFORCE IN BANKING
50 62
64 VR, AR AND THE FUTURE OF PAYMENTS
80 Women in FinTech
98 Atom Bank
114 DHL Express South Africa
128 Arab National Bank
142 Absa Group
10
LEVERIS: REINVENTING BANKING THROUGH D I G I TA L TECHNOLOGY WRITTEN BY
MATT HIGH PRODUCED BY
JAMES PEPPER
AUGUST 2020
11
f in t e c hm a g a z in e . c o m
LEVERIS
Conor Fennelly, LEVERIS founder and CEO, discusses how the company is reinventing banking with its innovative, cloud-native platform
L
EVERIS was born out of a single aim: to use the power of digital technology to build a better banking experience. The
complexity that is inherent in many legacy banking platforms and infrastructure is hindering evolu12
tion in the financial services industry. As a result, according to LEVERIS, those institutions are at a fundamental point of change where, rather than evolve, they must invent to remove the constraints imposed by existing technology. Since its founding four years ago, the company – which is driven by more than 200 individuals with extensive banking and technology experience – has worked to solve this problem. It has done so by designing and building an innovative, cloud-native platform that is unencumbered by existing systems and enables banks and financial institutions the freedom to offer customers tailored experiences. LEVERIS is led by CEO and founder Conor Fennelly, a highly experienced tech entrepreneur who, over the course of a career that includes a 20-year stint in Silicon Valley, has founded and led AUGUST 2020
13
2016
Year incorporated
200+
Number of employees
f in t e c hm a g a z in e . c o m
LEVERIS
several high-growth internet startups.
Southeast Asia’s largest independent
The company, he says, is built on the
systems, integrations, and technol-
belief that “it’s not so much a case
ogy and software companies, where
of banks failing their customers, but
he worked on bank-to-bank systems
more a case of technology failing
integrations projects. “We used that
banks. The systemic problems fac-
experience to develop a micro-billing
ing banks can be addressed almost
software solution, which acted as a
entirely via technology.”
financial services layer between credit
This approach, says Fennelly, was
cards and gift cards and scaled very
cemented during his previous interac-
well,” he adds. “From there, I’ve also
tions with the financial services sector.
completed several core transforma-
This includes five years running one of
tion projects in the sector and, through
14
AUGUST 2020
15
“ We provide the platform to build what they want, to implement their strategy and achieve their version of success” — Conor Fennelly, Founder & CEO, LEVERIS
f in t e c hm a g a z in e . c o m
LEVERIS
16
that experience and over that time, we
resilient, and stood the test of time with
really understood what a banking plat-
no major issues until about five years
form was - all the existing peculiarities,
ago. The rise of fintech really changed
legacy issues and complexities.
things. It started disintermediating, and
“Each time you do an implementa-
showing banks that innovative technol-
tion of that kind, the result is always
ogy can be used to do things faster
suboptimal,” Fennelly continues. “We
and better, to operate in real-time and
reached the stage where we thought:
provide greater value to the customer.”
‘if we had the freedom to do it again,
The latter, Fennelly notes, is becom-
how would we do so differently and
ing increasingly important as a driver
in a way that eradicated all of those
for change. Customers want more
issues?’. Legacy systems have per-
control over their finances, as well
formed well - they’ve been robust and
as the convenience and value-added
AUGUST 2020
service to exercise that control when they choose - this can be provided by the kind of data-focused technology that doesn’t exist in legacy systems. “There are several key issues,” Fennelly explains. “In some respects, it’s not so much the technology itself as the organisational composition that sets everything in silos - you have deposits,
“ Banking isn’t radical, it just has to be better” — Conor Fennelly, Founder & CEO, LEVERIS
E X E C U T I V E P R OF IL E :
Conor Fennelly
Title: Founder & CEO
17
Company: Leveris
Industry: Financial services Location: Dublin, Ireland Conor’s career has been defined by an ability to identify and solve practical problems by developing innovative digital solutions and delivering them at scale. His modus operandi is low profile, high impact. Various ventures, including Nomad Software Solutions and eoBuy, have taken him from Ireland to Silicon Valley, South East Asia and many places in between. Technologies he has conceived and built have been licenced and deployed by governments and Fortune 500 companies in areas such as systems integration, bank transformation, mobile phone networks and digital music distribution.
f in t e c hm a g a z in e . c o m
LEVERIS
“ We set out to build a next-generation full services retail bank and part of that was really about considering what the bank of 2030 looked like.” — Conor Fennelly, Founder & CEO, LEVERIS
18
AUGUST 2020
checking or current accounts, access control and so on, and they all have their own databases, which can equate to anything from 500 to 1,000 subsystems. The holy grail of banking is to have one single view of the customer, but that doesn’t really work as the fundamental data model in legacy systems isn’t established to deliver that from the beginning. “Similarly, existing technology is typically product oriented rather than being customer centric,” he adds. “Any new system has to be entirely focused on the customer - everything you do, irrespective of the service should accrue in one area and that data is then used across everything.” Fennelly also points to the high CapEx required to run a legacy system as a result of their complexity, adding that they are precarious to maintain and difficult to change due to their being non-homogenous. On the latter he explains “even the simplest of things can be overly complex; there are multiple vendors in a bank’s world and software written in different languages so that any change has to be coordinated through this complexity.” f in t e c hm a g a z in e . c o m
19
LEVERIS
LEVERIS offers an alternative to these issues. The company has built a system from the ground up, using state-of-the-art, best-in-class technology that is service driven and changes the way that businesses deliver financial products. The LEVERIS platform is a cloud-native, real-time, non-legacy core banking system that is modular, flexible and secure. It leverages big data to streamline operations for banks and lenders, and increase their revenue, uses process automation to 20
reduce the need to manual intervention and is configurable to each customer’s specific requirements. “Everything is automated end-toend and completed in real-time,” says Fennelly, “which are the major things in terms of how this changes the way in which banks operate. We set out to build a next-generation full services retail bank, and part of that was really about considering what the bank of 2030 looked like. We realised about a year into the build that, while we could build the technology stack, we couldn’t implement all the features on that stack unless we had a clear idea of what that bank looked like. From a customer AUGUST 2020
ANNOUNCEMENT
The LEVERIS platform is now live in the Dutch market, where it’s executing loans and servicing millions of euros for three clients of major financial services firm, Link Group. The platform has helped deliver a 70% reduction in average application to drawdown, enabled the onboarding of additional lenders to the platform in less than four weeks and delivered a significant reduction in operational costs for Link Group.
perspective, that’s all about advocacy and building an effective transactional relationship through the greater use of data, for example. Banks haven’t always architected customer data in a way that’s useful, but that data has a massive residual value for customers.” LEVERIS creates a single view of the customer by mapping all data to a unique customer ID. This gives a complete picture of the customer across the bank’s entire platform and allows the building of a personalised picture of the customer and their journey, thus enabling the building of an enhanced customer experience. The LEVERIS platform has a single customer view, is quick to market, has open APIs and connects the dots across a wide f in t e c hm a g a z in e . c o m
21
LEVERIS
variety of data types, categories and systems; it is also scalable as their clients’ companies grow. “Many bankers are acutely aware of what they want from their technology stack, they’re just missing the product to do it - they’re constrained by the tech,” says Fennelly. “The interesting thing is that we don’t have a revelation about how these changes are translated in the front end, the fundamental pivot points that will make the difference are actually quite subtle. Take 22
the heart of the bank, the current or savings account. It’s an idea that’s set in stone and that the consumers
“ It’s not so much a case of banks failing their customers, but more a case of technology failing banks” — Conor Fennelly, Founder & CEO, LEVERIS AUGUST 2020
23
understand, but we have the notion of
about removing that complexity and
an ‘account’ with a set of attributes that
providing a technology that allows the
the bank can scale as it chooses.
building of any unique set of services
“The idea is that, if you look at bank-
for a consumer based on a very lim-
ing infrastructure of yesterday against
ited number of products in the back
that of the future, then you’ll see histor-
end. Adding a new card, a new per-
ically that banks have built thousands
son to the account or so on doesn’t
- even tens of thousands - of products,
increase the product complexity in
because any change or variation in
our world, and that’s a real revolution
things like different accounts has to be
in financial services. There’s no major
manufactured as a ‘new’ product,” he
technology required, it’s how you
continues. “The core of a transforma-
pose the pieces and, really, it’s about
tion and a platform like LEVERIS is
how far your imagination goes.” f in t e c hm a g a z in e . c o m
LEVERIS
Currently, the LEVERIS platform is available for banks, lenders and loan servicers. For the former, the system is delivered market ready and preintegrated with the essential banking services required to launch and run a modern digital bank. “Take a typical legacy bank that has a number of branches as an example,” says Fennelly. “We can operate our platform completely independently as an additional branch in the
24
“ There’s no major technology required, it’s how you pose the pieces and, really, it’s about how far your imagination goes.” — Conor Fennelly, Founder & CEO, LEVERIS
AUGUST 2020
infrastructure, which lets our customers ‘plug LEVERIS in’ their world seamlessly as a starting point. Over time, we can then work on tactical strategic decisions of which legacy systems to take out and to migrate across to our platform. It becomes a natural evolution that leads to a greatly improved digital direction.” Since it was established, LEVERIS has focused on developing a platform that can transform banking. Little has changed since that original vision was developed, Fennelly explains, but the business is now focused on going to market. “Banking isn’t radical, it just has to be better,” he states. “And it also has to be capable of incremental, organic improvement. We’ve a blank platform that is given to every client, it’s up to those banks how they use our configuration interfaces to build the products they want - we don’t give them the technology to succeed, we provide the platform to build what they want, to implement their strategy and achieve their version of success.”
f in t e c hm a g a z in e . c o m
25
FINTECH
26
Payments innovation in the new world WRITTEN BY
MATT HIGH
AUGUST 2020
27
f in t e c hm a g a z in e . c o m
FINTECH
Airwallex VP of Global Banking, James Butland, discusses COVID-19, innovation in payments technology and the future of fintech
D
isruption and change underpin the rise of the fintech sector. Whether innovative, cutting-edge technologies or new,
digital-first business models, success in fintech and the broader financial services industry relies in no small part on navigating this disruption. It may be why the fintech sector has been keenly watched during the COVID-19 global pandemic. 28
Like all industries, fintech has faced its challenges – 22% of UK fintech jobs being at risk, according to one report, for example – but with many fintechs demonstrating their ability to be agile and flexible enough to diversify and actively engage in combating COVID, there has been great interest in how the sector will transition through the pandemic. James Butland, VP of Global Banking at international payments provider Airwallex, is no stranger to change. Butland has been active in the financial services industry since 2007, working for both incumbents (including during the 2008 financial crisis) and, more latterly, fintechs. Prior to joining Airwallex, he headed up European Banking at Transferwise, managing and expanding the company’s existing European banking network and scaling up product development. AUGUST 2020
James Butland,VP of Global Banking, Airwallex 29
f in t e c hm a g a z in e . c o m
FINTECH
“ We’ve actually seen a huge rise in companies going digital and looking at new ways of making savings and improving efficiency” — James Butland, VP of Global Banking, Airwallex
a part of a fintech in that sense is that you’re really building a brand from the ground up – your mission is to really
Such breadth of experience has provided Butland with valuable
that are still using incumbents and
insight across the financial services
say to them ‘what do you want and
value chain. “As you’d expect, the working environment at incumbents 30
find those customers or organisations
and fintechs is very different,” he explains. “On the one hand you have a very structured and quite formal environment that has been in place for 10 or 15 years, whereas at a fintech you’re often starting from the very early stages, running on a continuous cycle of product development and innovation. When I joined TransferWise it was still a relatively young fintech, and the same goes for Airwallex, which I joined around three years ago with the aim of building out the global banking network and infrastructure and growing the European footprint. The exciting prospect about being AUGUST 2020
how can we build a product that is
tailoring your product and approach to
10 times better than that which you’re
the region you work in; we sell in China,
already using?’.”
for example, but that’s very different
With Airwallex, Butland is based
from the product we offer in Europe.
in the UK, albeit responsible for expand-
If you look at payments, I think the UK
ing the company’s footprint into
is at the forefront in terms of regula-
Europe. He is, understandably, a
tion and market conditions, but I spend
strong proponent of the UK’s position
a lot of time with the Airwallex team
in the financial services and payments
in Asia Pacific, where they’re leading
industry. “Fintech isn’t a global, one-
the way in terms of on the ground pay-
size-fits-all industry – it’s all about
ments and moving money. In China, of course, there’s the development of super apps and other technologies, so every region is very different and that dictates how you operate.” Regardless of region, technology has been the key driver of change in every sub-sector of financial services. In payments in particular, Airwallex has developed tech-driven infrastructure that enables low-cost, high-speed and transparent international collections and payments via API. “We approached the problem in a very different way to incumbents that have a bricks-and-mortar presence, instead as a ‘software layer’ across the globe that can connect all banks and locations into one unified whole. What we offer is a complete platform that f in t e c hm a g a z in e . c o m
31
FINTECH
Airwallex - Your passport to global business CLICK TO WATCH
|
1:17
32 other services can be added to, so you
use of digital payments and financial
can do foreign exchange FX), collect
services tools. “We’ve a large pres-
money in different countries, create
ence in Shanghai, so we were aware
debit cards and pay for goods, accept
of the potential implications earlier than
funds and more. We don’t deal with
some organisations and we pivoted
cash, it’s all digital and done over the
very quickly to be able to manage any
web through our API technology.”
possible disruption. Many of the areas
Of course, that shift to digital has
that we support, such as travel or edu-
only increased for all businesses – and
cation, have naturally been impacted
consumers – as a result of the global
quite badly, but there has been a sig-
COVID-19 pandemic. Airwallex has
nificant increase in ecommerce that
proved robust despite the challenges
means we’ve been quite resilient.
placed on it from COVID, says Butland,
“In terms of the wider shift to digital,
and the broader shift to remote work-
I think that’s been happening for a
ing and isolation has increased the
while but COVID will certainly increase
AUGUST 2020
“ We approached the problem in a very different way to incumbents that have a bricks-and-mortar presence” — James Butland, VP of Global Banking, Airwallex
date and raising $160mn in Series D funding. Butland explains: “The round was completed at the height of COVID,
it,” he continues. “People haven’t
which was of course a challenging
been using high street banks or
time, but it demonstrates that the
shops, so there is a real migration to
fundamentals of our business haven’t
managing finances virtually, and the
really changed, we were still serving
pace we’ve seen it change is incred-
our core markets and our customers
ible. Businesses still need to use
were still using the platform so we
payments services, and to manage
were able to show investors that we
payments internationally, so our sec-
were a resilient business. If you look
tor specifically actually looks very
at fintech investment at the moment,
healthy – we’ve actually seen a huge
deals are still happening, but there’s
rise in companies going digital and
definitely questions over what that
looking at new ways of making savings
recovery will look like.”
and improving efficiency.” To aid this, Butland adds, Airwallex waived FX fees for three months for its customers from March, which proved a timely intervention. The economic landscape has undoubtedly proved challenging. However, despite this, Airwallex has continued its growth strategy including the closing of its largest investment round to f in t e c hm a g a z in e . c o m
33
FINTECH
34
“ Fintech isn’t a global, one-size-fits-all industry – it’s all about tailoring your product and approach to the region you work in” — James Butland, VP of Global Banking, Airwallex
AUGUST 2020
35
For Airwallex, the investment will
collect funds locally in different coun-
predominantly be used for the organi-
tries. Before we launched this product,
sation’s expansion into Europe that
if you wanted to launch a new business
Butland will lead. “The challenge for
in the US, or any other country, you’d
Europe is really around how to sell
have to have a presence there. With us,
your product to individual countries
you can provide some simple details
and markets,” he explains. “We’re
and start a business on the same day,
really trying to focus on not just what
so we’re always looking at how we can
our customers need now, but what
improve the business and payments
they may need in the future. For exam-
landscape for people and improve
ple, one big focus is on the ability to
our offering around the world. Our f in t e c hm a g a z in e . c o m
FINTECH
36
“ Everything is going to change, even beyond financial services to how we as a society consume digital technology more broadly” — James Butland, VP of Global Banking, Airwallex
AUGUST 2020
entire purpose is to help people to run a business online, seamlessly, from anywhere in the world. This absolutely fits into the new, post-COVID world and that increasing digitisation we discussed, so it’s exciting that we’re helping to build that new world.” That new world, Butland believes, will see the continued growth of fintech within financial services. “The current situation is only going to accelerate the move to a digital world as all of the things that, traditionally, we did in person will be carried out online. The longer that fintech are around, particularly digital banks like Monzo or Revolut, the greater the trust will be in them from consumers and I can see, over the next five years or so, another wave of fintech banks and services, and insurtechs, coming into the market as that proposition strengthens. It’s only getting started now, but everything is going to change beyond financial services to how we as a society consume digital technology more broadly.”
f in t e c hm a g a z in e . c o m
37
BANKING
38
AUGUST 2020
BUILDING A RESILIENT, DIGITALLY-FOCUSED WORKFORCE IN BANKING WRITTEN BY
WILL GIRLING
f i nte c hma ga z i n e. com
39
BANKING
Using insights from McKinsey and Deloitte, we explore the challenges of change in the digital, post-COVID-19 culture of banking
A
t the very beginning of 2020, no-one could have predicted the ways in
which the COVID-19 pandemic has initiated a global shift in societal,
economic and business norms. As old opera-
tional paradigms are discarded or reimag40
ined in order to adjust to the ‘new normal’, the banking sector has been presented with an opportunity to accelerate any nascent plans to reshape its workforce structure to a truly modern standard. Although the initial impact of the virus left no time for banks to brace for the immediate effects, current market conditions suggest that those who embrace the latitude and spirit of innovation now required to bring the situation under control will benefit greatly; those who do not are likely to reap failure.
EMPLOYEE WELLBEING In its article ‘Shaping and safeguarding the banking workforce after COVID-19’, McKinsey highlights that one of the primary AUGUST 2020
41
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Driving insurers
digital future into a
At Cognizant, we’ve invested in the end-to-end capabilities needed to help insurance organizations not just do digital, but be digital. We partner with our clients to unlock new value and through the power of digital technologies and new ways of working, we help them evolve into more competitive, progressive versions of themselves. Learn more at Cognizant.com
Copyright Š 2019 Cognizant
changes to organisational structures
ahead of the crisis,” said the report.
will have to be an ever-closer relation-
Accordingly, bank HR departments will
ship between Human Resources (HR)
be able to enact on-a-dime decisions
departments and Board Executives.
on everything from entire buildings
Since the unpredictability of the virus
to individual workers.
makes rigid decision-making ineffec-
This ultimately comes down to
tive at best and potentially hazardous
establishing a system which ensures a
at worst, banks will need to ensure
higher degree of employee wellbeing.
a harmonious collaboration between
Whatever initiatives promoting mental
the two for the foreseeable future.
and physical health existed previ-
“HR should be a strategic partner in
ously will need to be accelerated and
the ‘nerve centre’ crisis-response
intensified to ensure staff are coping
team (which nearly all financial institu-
under the pressure. In fact, McKinsey’s
tions established weeks ago) and also
report suggests that this might even
any ‘plan-ahead team’ working to get
be taken one step further, with some
f i nte c hma ga z i n e. com
43
BANKING
“banks [...] considering extending
working. Deloitte opines in its arti-
support beyond individual employ-
cle ‘Shaping the adaptive financial
ees to the full ecosystem, including
services organisation of the future’
employees’ families and contrac-
that digital transformation strategies,
tors in the workforce.” This kind of
many of which will have accelerated
decision-making, in combination with
because of COVID-19’s restrictions
greater transparency and taking
of physical workforces, will come to
a balanced perspective on remote
define the modern financial spaces’
vs office working, will ease anxiety
ways of working. Old roles will either
amongst staff, promote a positive
be augmented or replaced by new
and caring image for the bank itself
ones which require a more innovative
and contribute to the overall effort
cultural mindset and entrepreneurial
of restarting the economy.
spirit from each member. “They will
44
focus on higher-value-added work,
WAYS OF WORKING
augmented with intelligent technolo-
More than simply restructuring how
gies, often with a heavy emphasis on
banks monitor and look after their
skills and competencies such as data
staff, the fundamental day-to-day
science and the customer experience,”
operations of a financial institution
says Deloitte. Indeed, the financial
will need to adjust to a new way of
sector may be seeing an end to siloed job functions and making a bold move towards cross-team fluidity; projectbased organisational models will require workers to be multi-taskers for a number of goals relating to different skillsets. Banks at the forefront of this workplace revolution will need to consider how to practically reskill existing staff and reevaluate hiring policies for future ones.
AUGUST 2020
D I D YO U K N OW?
Of the financial services companies it surveyed, Deloitte found the following statistic with regard to workforce restructuring: • 3 5% have a strong positive opinion that an adaptive, multitalented workforce will ensure an organisation’s success. • 84% of HR and business leaders believe that facilitating
performance across the workforce, including contractors, employees and third-parties, overall company performance can be improved. • 60% of senior executives intend to make job opportunities more flexible, enable greater autonomy and facilitate greater collaboration between teams.
45
f i nte c hma ga z i n e. com
BANKING
46 work-from-home options, both onshore and globally, for less sensitive work. Some are also introducing a variety McKinsey concurs with this prioritisa-
of workforce options, from staggered
tion on flexibility; the most successful
shifts to a different mix of full and part-
bank managers, it claims, will be those
time positions to work schedules set up
who maintain enough agility to react to
according to daily demand.�
changes in the financial or regulatory
Another factor in the reskilling process
situation with bold decisiveness. How
will also be determining how customer
workers actually conduct their daily busi-
expectations, requirements or priori-
ness (i.e. from home or in the office) will
ties have altered since the pandemic.
be important: both have their benefits
McKinsey suggests that microskilling,
and drawbacks, yet proper utilisation
upskilling, reskilling, reinforced account-
of both simultaneously will be crucial
ability and a particular emphasis on high-
to maintaining business continuity.
quality interactions will be important to
For instance, “many are leveraging
consider. Regarding the latter, the usage
AUGUST 2020
“ The banking sector has been presented with an opportunity to accelerate any nascent plans to reshape its workforce structure to a truly modern standard� be workplace targets, particularly the of video conferencing software and
time-scales for their accomplishment.
developing visual dashboards to help
Whilst monthly targets were once rea-
communicate a single source of truth
sonable, they may no longer reflect the
could help achieve this aim.
mercurial conditions and soon become
Style up as a sub headIn line with
obsolete due to revised objectives. A
a restructured workforce, manage-
better approach could be smaller short-
ment may find that it too needs to adjust
term goals which factor in the required
in order to fit the new normal. One of
level of corporate agility. In any eventu-
the first things that will require care-
ality, bank managers will need to estab-
ful reevaluation, posits McKinseys, will
lish clear communications across the
Understanding the economic shock of the Covid-19 crisis CLICK TO WATCH
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4:17
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47
BANKING
organisation, seek broader consensus prior to implementing new strategies and find appropriate ways to maintain company morale through well-placed incentives. “Leaders must play a central role in determining how successful their organisations are at adjusting to the immediate fallout of the COVID19 crisis. The uncertainty and longterm nature of the COVID-19 crisis will likely trigger further unanticipated workforce transformations that will reshape aspects of the future of 48
workforces with permanent effects,” McKinsey states. A more fundamental cultural shift DELO I T T E Human ingenuity + technology = innovation checklist:
• Explore new paradigms for the existing workforce structure.
• Pay attention to tech developments and use what’s available to anticipate the future.
• Grant employees the latitude and responsibility to explore moving outside the boundaries of their role.
• Ensure that the active workplace strategy is properly aligned with the organisation’s overall vision.
• T reat reskilling and workforce development as a resource.
• Take the opportunity to realign corporate culture with new workforce strategies.
AUGUST 2020
•E stablish clear risk and governance boundaries to reinforce responsibility and regulatory adherence. resources, tools and insights.”
“ HR should be a strategic partner in the ‘nerve centre’ crisis-response team and also any ‘plan-ahead team’ working to get ahead of the crisis” — McKinsey
form within the next three years, this appears to be a trend which is gaining near-total acceptance in the sector. In fact, Deloitte’s survey found that 68%
might be the further integration of
of workers already believe that AI’s
human and machine capabilities,
widespread adoption will yield positive
for instance artificial intelligence
results. Therefore, it is all the more
(AI). Although sometimes intimidat-
crucial to establish what mundane
ing because of preconceived notions
tasks can be automated in order to
of ‘replacing’ workers, intelligent
allow the timely reskilling of work-
automation combined with human
ers in more qualitative roles. “HR [...]
creativity, innovation and empathy
should look at how it can harness
can yield significant levels of effi-
talent strategy, reskilling, leadership
ciency for financial service providers;
development and process redesign
Deloitte cites evidence that “AI has the
to help the organisation drive optimal
potential to boost labour productiv-
results from investment in AI,” Deloitte
ity by up to 40% by 2035”. With the
says. “A siloed approach to automa-
same survey also claiming that 76%
tion will impact the workforce strat-
of financial institutions are planning to
egy and fragment the organisation
introduce smart automation in some
and culture.” f i nte c hma ga z i n e. com
49
INSURTECH
50
Inside the RegTech Revolution WRITTEN BY
AUGUST 2020
HARRY MENE AR
51
f i nte c hma ga z i n e. com
INSURTECH
Powered by AI, Machine Learning and NLP, and driven by increasingly complex regulatory environments, the RegTech industry is rapidly reaching maturity
T
hroughout the global finance industry, enterprises are facing an increasingly complex regulatory landscape. Issues of compliance, risk manage-
ment and reporting have always been a chal-
lenge to overcome in this sector. However, the explosion of technology-driven financial 52
solutions in the last decade has created complications in this space faster than they could be solved. The fintech revolution has accelerated the pace of change in the finance sector dramatically. The industry is becoming faster, more agile, and more efficient than ever; new services, increasing connectivity, and deeper penetration of digital solutions across every global market is disrupting verticals like never before. Given the speed of these changes, the global regulatory framework has also fractalized, increasing in complexity faster than enterprises can adapt. Between 2008 and 2016, there was a 500% increase in regulatory changes in developed markets. Today, it’s estimated AUGUST 2020
53
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that a new regulatory update is made
the new wave of regulatory technol-
every seven minutes. In addition to the
ogy solutions is an essential step.
blinding new pace of the regulatory
Since 2015, the RegTech industry
environment, oversight organisations
has grown out of virtually nothing to
are increasingly clamping down on
become one of the most dynamic
infractions. During the 2019 fiscal
financial verticals in the world. By
year, the United States Securities and
2027, global RegTech spending is
Exchange Commission filed 2,754 new
expected to exceed US$21.7bn and,
enforcement actions (including 95
according to a 2018 report by Medici,
against public companies) – the high-
“an end-to-end RegTech implementa-
est number in over a decade. The risks
tion promises 634% in ROI realisable
of non-compliance are skyrocketing
over a three-year period.” In short, the
almost as fast as the difficulty curve
potential benefits are staggering. This
of remaining compliant.
month, FinTech explores the emerging
If enterprises are to avoid the
RegTech industry, and some of the
disruption that accidental regulatory
key companies driving this global
breaches can incur, then harnessing
financial evolution.
“ An end-to-end RegTech implementation promises 634% in ROI realisable over a three-year period” — Medici
f i nte c hma ga z i n e. com
55
INSURTECH
WHAT IS REGTECH?
as a half-measure that failed to hold
In much the same way that fintech
accountable the executives respon-
refers to the application of cutting
sible for the crash – nevertheless had
edge digital solutions to the finance
the effect of catalysing a much stricter
sector, RegTech is the result of
regulatory environment. Since 2008,
applying technologies like artificial
US banks have been fined more than
intelligence (AI), machine learning
$243bn for regulatory breaches, a
(ML), natural language processing
figure that amounts to a de facto 8%
(NLP) and blockchain to the regulatory
tax on every enterprise in the financial
sector in order to keep up with the
sector. In fact, at large financial institu-
accelerating challenges of regulatory
tions, the cost of managing these new
compliance.
regulatory and compliance-based
RegTech’s origins lie in the fallout 56
risks can amount to an average of
from the global financial crisis of 2008.
$10,000 per employee. In addition
The Dodd Frank Wall Street Reform
to Dodd Frank, regulatory structures
and Consumer Protection act ushered
like GDPR and FINRA have imposed
in an era of financial regulation that
further regulatory overlays on compa-
stood in stark contrast to the pre-
nies, resulting in more and more fines
crisis period of financial de-regulation.
for breaches. In order to combat those
The act – while criticised by some
losses, financial institutions began harnessing cutting edge technologies to navigate this new regulatory jungle. In a report released earlier this year, global consultancy and accounting firm Deloitte asserted that, “RegTech promises to disrupt the regulatory landscape by providing technologically advanced solutions to the ever increasing demands of compliance within the financial industry.” RegTech
AUGUST 2020
57 companies – of which there are about
doubling in value over the course of
340 in operation today, according to
the year.
Deloitte – provide solutions to a vari-
The RegTech space is – much like
ety of problems. These can broadly
actual outer space – in a constant
be broken down into: regulatory
state of rapid expansion. New start-
reporting, risk management, identity
ups and larger scale enterprises are
management and control, compliance,
constantly entering the market as it
and transaction monitoring. RegTech’s
approaches maturity. “RegTech is no
use of AI and ML means that compa-
longer just for early adopters. We’re
nies using RegTech can increasingly
starting to see the actual, tangible ben-
automate processes like due diligence,
efit these technologies can provide,”
data management and analysis.
said Brian Clark, CEO of RegTech firm
According to a recent report, 2018
Ascent, earlier this year. Here, FinTech
was the largest ever year of invest-
takes a look at one of the leading
ment in RegTech, with deals attract-
companies from each of the industry’s
ing $4.5bn globally and more than
subcategories. f i nte c hma ga z i n e. com
INSURTECH
58
REGULATORY REPORTING – SHIELD
specific needs of its customers’ com-
Based in Tel Aviv (and with offices in
pliance teams; a correlated sequential
London and Copenhagen), Shield was
view of trading events with fast, com-
founded as part of the 2018 RegTech
prehensive and interactive timeline
boom, and specialises in reducing
reporting in an intuitive front-end.
compliance risks through intelligent, automated reporting. The company’s compliance platform utilises NLP and AI to automate and orchestrate the complete communications compliance life cycle, mitigate risk and make surveillance efficient and ROI driven. It launched version 2.0 of its platform in 2018, which built upon its significant offering to aggregate and analyse more data sources and deliver a new interrogation engine to meet the AUGUST 2020
"We believe that firms need to take a strategic approach in dealing with
“ Firms need to take a strategic approach in dealing with recordkeeping and best execution regulation in a holistic way” — Shiran Weitzman, Co-Founder and CEO, Shield
record-keeping and best execution
RISK MANAGEMENT – CORLYTICS
regulation in a holistic way…” com-
With firms around the world facing
mented Shiran Weitzman, Co-Founder
up to 250 regulatory alerts on a daily
and CEO of Shield. "[Shield V2.0] goes
basis, companies are in desperate
well beyond the current box-ticking
need of relevant data and insights.
most firms employ when archiving
“Demand for regulatory risk support
eComms data in discrete silos, which
is at an all time high,” said John Byrne,
presents a huge problem when trading
CEO of Corlytics in 2017. “The top 20
events need to be reconstructed."
banks paid out over $9 billion dollars
Shield was one of the winners of
in fines in 2016 alone. Regulation is not
Deloitte’s first RegTech Challenge.
slowing and is providing a constant challenge to financially regulated firms and for the regulators themselves.” Established in 2013, Corlytics is a Dublin-based RegTech firm and
How to sign up to Corlytics RED CLICK TO WATCH
|
0:58
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59
INSURTECH
“ RegTech promises to disrupt the regulatory landscape by providing technologically advanced solutions to the ever increasing demands of compliance within the financial industry”
including the top spot at the 2019 Deloitte RegTech Challenge. In response to the COVID-19 pandemic, Corlytics has released Corlytics RED, an open access regulatory monitoring solution to allow companies to keep pace with evolving regulations relating to the crisis.
— Deloitte 60
ligence. The company’s service uses
IDENTITY MANAGEMENT AND CONTROL – VADIS TECHNOLOGIES
powerful data analytics to identify
In a world where partner ecosys-
high priority regulatory themes and
tems are becoming increasingly
taxonomy to extract relevant intel-
interconnected, and XaaS business
ligence to rate the risk of regulatory
models make different verticals even
concerns. The company’s analytics
more intertwined, access to valu-
are powered by NLP and AI-based
able, trustworthy data is an essential
text analysis technology, which
component of risk management.
allows it to assemble disparate
Vadis Technologies is one of the
regulatory information into defined
early pioneers of big data analytics,
categories using 160 different data
and business intelligence. Founded
points that are then mapped to
in 2003, the Brussels-based firm
their sources.
offers its clients a data-as-a-service
a world leader in regulatory risk intel-
As of 2020, Corlytics has raised
approach, using human analysts and
more than $27mn in funding and
AI to harvest and enrich complex
received a number of awards,
business data on more than 300mn
AUGUST 2020
Vadis Technologies Purpose CLICK TO WATCH
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1:00
61 companies to offer risk scoring and 360° third party monitoring.
With headquarters in San Francisco and Cambridge, England, Darktrace is one of the world’s leading AI companies, and the creator of its proprietary Autonomous Response Technology. Its AI is modeled on the human immune system and won first
COMPLIANCE – DARKTRACE
place at the 2019 Fortress Cyber
Compliance is by far the largest
Security Awards. Compliance with
subcategory of RegTech companies,
regulations like GDPR, HIPAA, and
with about three times as many as
the DFS Cyber Security Regulations
any other field. This comes as no
adds another dimension to the exten-
surprise, since compliance is the very
sive list of challenges facing security
basic core competency of any regu-
teams. Thanks to its ability to identify
latory enterprise.
and contain threats in seconds, aid f i nte c hma ga z i n e. com
INSURTECH
62
STAT I ST I CS
● The cost of compliance across all banks from 2014 to 2016 averaged approximately 7.0% of their noninterest expenses ● I n the first three quarters of 2019, investment in the RegTech space grew by 103%
AUGUST 2020
●R egTech is on the verge of separating from FinTech and becoming its own industry ● RegTech Market size in 2019: $5.3bn ● RegTech Market CAGR: 19.5%
“ RegTech is no longer just for early adopters. We’re starting to see the actual, tangible benefit these technologies can provide” — Brian Clark, CEO, Ascent
its customers a SaaS platform that monitors transactions and financial behaviour to better detect fraud,
in the investigation of attacks, and pro-
money laundering and other finan-
vide complete visibility of digital activity
cial crimes.
across the business, Darktrace’s AI
In March of this year, IdentityMind
enables organisations across all sec-
was acquired by identity verification
tors to comply with industry-specific
solutions provider Acuant. "As digital
and international regulations – without
transactions continue to see mas-
purchasing additional tools.
sive growth, understanding who's on the other end of the transaction is key to reducing fraud, managing risk and complying with regulations," said Trace Fooshee, Senior Analyst with Aite Group. "This evolution of
TRANSACTION MONITORING – IDENTITYMIND
the Acuant Trusted Identity Platform
Fintech compliance regulation
in the dynamic market for identity
frameworks like Know Your Customer
orchestration platforms."
with IdentityMind positions them well
(KYC) have dramatically increased the onus placed on companies to pursue greater transparency within both their operations and customer bases. Founded in 2013, Palo Altobased startup IdentityMind offers f i nte c hma ga z i n e. com
63
PAY M E N T S O L U T I O N S
64
AUGUST 2020
VR, AR AND THE FUTURE OF PAYMENTS WRITTEN BY
HARRY MENE AR
65
f i nte c hma ga z i n e. com
PAY M E N T S O L U T I O N S
FinTech Magazine explores the challenges, trends and companies dominating VR and AR adoption in the payments industry
A
longside flying Deloreans and robot butlers on roller skates, few things evoke a sense of the futuristic more
than virtual reality (VR). Artists, authors and philosophers have been grappling with the themes of “unreal worlds”
66
that we might inhabit, mostly indistinguishable from our own, for millennia: just look at the allegory of Plato’s Cave – its inhabitants living their whole lives convinced the shadows they see encompass the entirety of their reality. In the last century, science fiction has often speculated on the role that virtual realities might play in our societies, from Laurence Manning’s 1933 serial The Man Who Awoke all the way up to probably our biggest modern touchstone for VR: The Matrix. Obviously, in much the same way that robotics and artificial intelligence (AI) haven’t led to our destruction by terminators and replicants, and experiments with gene editing haven’t led to any dinosaur outbreaks (that we know of), VR seems equally unlikely to trap us all in pixelated prisons any time soon. AUGUST 2020
67
f i nte c hma ga z i n e. com
Establish trust remotely. Jumio uses informed AI to deliver identity verification as it should be.
Streamline eKYC Catch more fraud Convert customers faster
jumio.com
69
As a technology, VR – and with
case you needed a more familiar
it augmented reality (AR) – is still in
reference point). By 2024, that fig-
its relative infancy. It’s seen widest
ure is predicted to increase to more
adoption in the gaming and electronic
than $44.7bn (placing it somewhere
entertainment verticals, but industries
between Paraguay and Cameroon).
around the world are quickly catching
That’s a CAGR of more than 33%:
on to the fact that bringing customers
a staggering figure in an industry of
and employees into virtual spaces
that size. In short, VR and AR are set
is poised to have a profound impact
to be economically disruptive trends
on the way they work, play and spend
on par with Blockchain and potentially
their money.
even AI adoption.
In 2018, the VR market was worth
Although VR and AR are still in their
about US$7.9bn (which is roughly
relatively early stages, the technolo-
equal to the GDP of Tajikistan, in
gies’ applications are already gaining f i nte c hma ga z i n e. com
PAY M E N T S O L U T I O N S
“ In the 2020s, we will get breakthrough AR glasses that will redefine our relationship with technology” — Mark Zuckerberg, CEO, Facebook traction in the fintech payments space. 70
From more immersive forms of ecommerce to in-store experiences, the disruptive potential is significant. However, there are also signs that the
more immersive experience, the
integration of payments into VR and
technology also foreshadows a trend
AR experiences has the potential to
towards increased immersion in the
encounter similar problems to other
payments space. In this age of instant
experiential technologies like 3D films.
gratification, the ability to integrate the
Overcoming these challenges will
payment process into the customer
shape the relationship between fin-
experience as unobtrusively as pos-
tech payments and VR over the com-
sible is a huge potential driver of value.
ing decade.
In January, Facebook Founder Mark Zuckerburg made a post exploring his
THE PLATFORM OF THE FUTURE
predictions for technology throughout
In much the same way that VR is
the coming decade. He noted that
being harnessed by the gaming and
“The ability to be ‘present’ anywhere”
entertainment markets to create
has the potential to massively impact
AUGUST 2020
71
the way we work and solve societal
he notes. “While I expect phones
issues. It’s not like he doesn’t have skin
to still be our primary devices
in the game, of course, as Facebook
through most of this decade, at
purchased VR trailblazer Oculus in
some point in the 2020s, we will get
2014 for $2bn. Zuckerburg clearly
breakthrough AR glasses that will
sees VR and AR as the next phase of
redefine our relationship with tech-
our interaction with the digital world.
nology”. As ecommerce continues
“The technology platform of the 2010s
to grow, and the fintech industry
was the mobile phone. The platform of
continues to digitalise the finance
the 2000s before that was about the
sector with unprecedented speed
web, and the 1990s was the desktop
and scale, the potential for VR and
computer. Each computing platform
AR to shape the way we interact
becomes more ubiquitously acces-
with the payments process becomes
sible and natural for us to interact with,”
even clearer. f i nte c hma ga z i n e. com
PAY M E N T S O L U T I O N S
Mastercard and Swarovski launch virtual reality shopping experience CLICK TO WATCH
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0:57
72
THE VIRTUAL SHOWROOM
to wall art. The app then presented
One of the biggest applications of VR
users with information on the items
to ecommerce and retail to take off
and allowed them to make purchases
so far has been the creation of virtual
then and there using Mastercard’s
showrooms. Back in 2017, Mastercard,
MasterPay platform. “This partnership
immersive experience startup YouVisit,
allows consumers a fully immersive
and luxury brand Swarovski collaborated
shopping opportunity to interact with
on a virtual shopping app which allowed
the product and then purchase seam-
customers to virtually explore a stylish
lessly within the experience,” Nadja
model home filled with Swarovski’s
Swarovski, Member of the Executive
decor. Using a VR headset (optionally
Board of Swarovski Crystal, commented.
encrusted with Swarovski diamonds),
“The cutting-edge VR technology allows
customers could navigate from room
consumers to fully realize scale and
to room and, with a gesture, highlight
engage more deeply with design details
everything from decorative candlesticks
before making a purchase.”
AUGUST 2020
In the same year, Visa also launched
frontier of digital commerce," said
one of the first virtual shopping envi-
Sam Shrauger, SVP of Digital Products
ronments, complete with integrated
at Visa. Users could use the app to
payments. Launched at Money 20/20
browse products from LA-based
in Copenhagen, PayScout and Visa’s
clothing retailer Body Language
VR-powered app marked the first
Sportswear, browsing, rotating and
time that customers could shop and
purchasing the items without leav-
purchase physical products within
ing the app. These applications are
an immersive VR experience — and
gaining traction around the world, as
have those products delivered to their
customers flock to features like prod-
homes. "Virtual reality is already one
uct visualisation, virtual fitting rooms,
of the best ways to bring unique and
access to product information and
immersive experiences to life, and
virtual malls.
we've now unlocked VR as the next
While 2016 and 2017 saw a veritable explosion of virtual showrooms
“ Cutting-edge VR technology allows consumers to fully realise scale and engage more deeply with design details before making a purchase
backed by big financials and tech firms, the trend has died down a little in the following years. If you’re looking for an analogy, think about 3D films. Every few decades (most notably in the 1950s and the 1980s, and then
— Nadja Swarovski, Executive Board Member, Swarovski Crystal f i nte c hma ga z i n e. com
73
PAY M E N T S O L U T I O N S
T H E VI RT UAL M ALL
74
Take a one-off VR project like the Mastercard-Swarovski showroom, add scale, and you get the virtual mall: a large, completely digital, environment where customers can browse multiple vendors and explore different goods in the same way they would in a physical retail space. The first virtual mall debuted in Korea in 2017. Customers in VR headsets could browse a space containing goods from Korean retailers like Lotte Department Store, Hyundai Department Store, E-Mart, LG Electronics, and Lotte Hi-Mart. While revolutionary, the experience was more of a marketing stunt for a tech event than a lasting establishment. One of the world’s biggest virtual
AUGUST 2020
malls is operated by Chinese retailer K11, which has stepped up its efforts in response to the COVID-19 pandemic. K11 lets visitors virtually visit 46 brand stores, browse goods along aisles as they would in the actual stores, and then purchase those items for delivery. The mall launched in beta this February and has already reportedly seen 200,000 visitors. While VR shopping malls haven’t exactly blown brick and mortar retail (or traditional online shopping) out of the water in the last few years, the enforced isolation of the pandemic, along with increasingly seamless payment integrations, has the potential to tip the scales.
again in the 2010s following the suc-
a critical lesson for companies looking
cess of James Cameron’s Avatar) the
to explore VR applications in their ecom-
technology develops to a new level
merce offerings. Experiences need to
of sophistication and, as a result, is
achieve goals of seamless integration
pushed hard at audiences for several
and ease of access if the market wants
years. So far, the response from audi-
to avoid the kind of 30 year hibernations
ences with regard to 3D films is that
that have plagued 3D cinema.
the added immersion of a protruding
However, there is one major factor
spear, or the realistic contouring of
impacting the world right now that could
Gerard Butler’s abs, is a cheap gimmick
spell good news for VR and AR adoption.
at premium prices. This isn’t to say that VR and AR in
THE COVID FACTOR
retail is a cheap gimmick by any means.
At a time when customers’ access to
However, audience fatigue over paying
physical retail locations is increasingly
more for a less refined experience is
restricted by factors like COVID-19,
Obsess – virtual stores for the latest trends CLICK TO WATCH
|
1:41
f i nte c hma ga z i n e. com
75
PAY M E N T S O L U T I O N S
“ The only thing missing for their widespread adoption was an impetus to meet and shop in virtual worlds. That impetus has come with the COVID-19 pandemic and ensuing lockdown” 76
— Nikhil Joshi, Co-founder, Digital Jalebi the ability for VR to give consumers
these immersive platforms. These tech-
access to the facsimile of physical
nologies are affordable and readily avail-
spaces has huge potential for brands
able. Even after the lockdown ends,
looking to curate and present novel
the behavioural change it instigated will
experiences. “The COVID-19 pandemic
last considerably longer if not forever.”
has turned the world upside down. Yet
Joshi believes that this is the right
the virus has initiated perhaps the first
moment to scale AR and VR usage
stage of a good behavioural change.
dramatically. “AR, VR, and mixed reality
The lockdown in place today is unprec-
aren’t science fiction; they are fully devel-
edented, yet its timing is fortuitous,”
oped technologies that are as reliable as
commented Nikhil Joshi, Co-founder at
laptops and smartphones. The only thing
AR/VR specialists, Digital Jalebi. “Work
missing for their widespread adoption
in technologies like AR/VR/MR allows
was an impetus to meet and shop in vir-
people to shop, talk, and socialize using
tual worlds. That impetus has come with
AUGUST 2020
77
the COVID-19 pandemic and ensuing
as the car or the cell phone. However,
lockdown.” However, if VR and AR are
examples of companies actually pushing
going to operate as successful stand-ins
AR and VR together with payments and
for physical experiences – and compete
towards the mainstream seem to be get-
with traditional shopping experiences –
ting rarer. Mastercard is using VR and AR
then the integration of payments into the
as more of an educational tool for their
process is going to be essential.
customers to learn about its other services. The VR retail launch that received
SOLVING THE VR PAYMENTS PARADOX
the most attention in the last year is yet
Going into the future, a baffling contra-
another high-end fashion stunt. The
diction still exists: VR and AR are unques-
potential is undeniably there, but the
tionably on the rise, and all predictions
creation of things like showrooms and
point towards the technology becoming
online shopping malls – and their subse-
as important a part of our daily lives
quent lacklustre impact on ecommerce f i nte c hma ga z i n e. com
PAY M E N T S O L U T I O N S
“ Virtual reality is already one of the best ways to bring unique and immersive experiences to life and we've now unlocked VR as the next frontier of digital commerce” — Sam Shrauger, SVP, Digital Products, Visa
78
AUGUST 2020
trends – suggests a mentality of trying to make the horse drive the cart. Creating VR applications to drive payment functions doesn’t resonate with customers. There’s another way, however, which has more potential of normalising VR and AR payments: applying payments to VR and AR experiences that already exist. As mentioned earlier, the earliest adopters and biggest sources of revenue for VR technology have been in the gaming and entertainment space. Consider again the size of the VR market in 2019: $7.9bn, according to Markets and Markets (about 1.01 Tajikistans per fiscal year in case you were struggling). According Fortune Business Insights, in 2019, the VR in Gaming market accounted for just over $5.1bn. Even accounting for discrepancies between sources, that’s a huge portion of the existing VR market. The global video game industry generates more than $120bn every year (which puts us in Kuwait territory). A potential key to successfully growing the payments space using VR and AR is to target applications in the industry that most widely uses it: electronic entertainment.
f i nte c hma ga z i n e. com
79
T O P 10
80
AUGUST 2020
81
Women in FinTech In no particular order, FinTech Magazine explores the careers of 10 highly influential women in the finance sector WRITTEN BY
WILL GIRLING
f i nte c hma ga z i n e. com
T O P 10
Capital Conversation Episode 58: Starling Bank CEO and founder Anne Boden CLICK TO WATCH
82
10
|
22:36
Anne Boden
Hailing from Swansea, Anne Boden is the founder of Starling Bank, one of the foremost digital banks in the world and a genuine fintech innovator. Following the completion of a degree in Chemistry and Computer Science, Boden began her career in finance with positions at Lloyds, Standard Chartered Bank and UBS. Her efforts in digital banking started in 2014 with the creation of ‘Possible Financial Services’, which was subsequently rebranded to the familiar Starling Bank in 2016. That same year, the company gained its UK banking license. Now regarded by some as a revolutionary breakthrough in online banking services, Boden continues to hold a 25% share in the company and received an MBE for her services to fintech in 2019.
CEO and Founder
Starling Bank
Position
Company
AUGUST 2020
President Position
Money20/20 Company
09
83
Tracey Davies
President of Money20/20, one of the world’s leading fintech events, Davies holds over 25 years of experience across the media, digital and event management sectors. Speaking with her in December 2019 at Money20/20’s Las Vegas event, Davies gave us an insight into how financial services are changing and the work she’s doing to encourage it: “There’s been a definite shift over the past few years that has seen the sector move away from ‘shiny and new’ technology – which, in this industry, we all love – to thinking about fintech for social good and how technology and financial services can impact lives for the better,” Davies explained. Further to this point, she is also the founder of Rise Up, an accelerator programme aimed at aspiring women who want a career in finance. f i nte c hma ga z i n e. com
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08
Kahina Van Dyke
An established leader in the fintech sector, Kahina Van Dyke has held positions at some of the most prestigious financial services companies around - Ripple, Mastercard and Citi - as well as other corporate luminaries like Facebook and Time Inc. Currently working at Standard Chartered, Van Dyke said, upon her appointment, “It is a privilege to be joining [...] a rich legacy and a truly unique global footprint. We will deepen and expand our leverage of digital technology and data analytics to deliver real economic impact to clients and communities around the world.” Amongst her accolades are: being ranked amongst the ‘Top 25 Women in Financial Technology’ and the ‘Blockchain 100’.
Disruptive forces in financial technology CLICK TO WATCH
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Global Head Digital Channels & Data Analytics Position
Standard Chartered Company f i nte c hma ga z i n e. com
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T O P 10
Head of Emerging Fintech Position
VISA Company
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07
Carla Ghosn
The Head of Emerging Fintech at Visa since 2015, Carla Ghosn has a skillset which combines IT, sales and finance across several companies, including CipherCloud and Salesforce. Earning a BSc from Southern Methodist University in Computer Engineering and an MBA from the University of Pennsylvania, Ghosn’s position as a leader in fintech is the result of years of hard work, talent and determination. “I have a passion for fintech, payments, and innovation. I enjoy leading strategic initiatives, partner engagement, transforming business models and I have a strong interest in advising startups and mentorship,” she says on her LinkedIn.
AUGUST 2020
Citi: Women in Technology: Carey Kolaja, Citi Fintech CLICK TO WATCH
06
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4:38
President & COO
Carey Kolaja
Position
Au10TIX Company
A recent interviewee of our new FinTech Magazine podcast, Carey O’Connor Kolaja believes that great leadership in the modern market can be summed up as being about “vision, ambition, mobilisation and motivation”. Truly influential within fintech and possessing over 25 years of experience, including leadership roles at Fortune 500 entities, she has been instrumental in the adoption of cutting-edge tech through commercial strategies to meet international and domestic market needs. Educated at Indiana University Bloomington and Stanford University Graduate School of Business, Kolaja enjoyed a 12-year tenure at PayPal (rising to VP of Global Consumer Products) before leaving in 2015 to work at Citi as Global Chief Product Officer, eventually leaving that role in 2019 to start work at ID authentication software company Au10TIX. f i nte c hma ga z i n e. com
87
From Inspiration
to Innovation
To know more, visit us at www.capgemini.com.au/insurance or email us at capgemini.marketing.au@capgemini.com
05
Kathryn Petralia
An American entrepreneur of distinction, Kathryn Petralia was ranked 98th by Forbes in its 2017 ‘Most Powerful Women in the World’ list. The Co-Founder and Chief Operating Officer of Kabbage in 2008, Petralia’s career has been shaped by technology, payments and e-commerce. Earning a BA degree in English Literature from Furman University (1986-1992), she became involved in the alternative lending market in the late 90s and launched/co-launched several startups, including Worthknowing.com which was eventually sold to CompuCredit 89
and TransUnion.
Co-Founder and Chief Operating Officer Position
Kabbage Company
By Web Summit - SD5_7895, CC BY 2.0 f i nte c hma ga z i n e. com
T O P 10
Co-Founder Position
Nubank Company
90
04
Cristina Junqueira
One of the co-founders of Nubank, the largest fintech currently operating in South America with over 20 million customers, Cristina Junqueira has proven her expertise in finding the best ways to combine finance and technology. Holding a BSc and MSc from the University of Sao Paulo (2000 to 2006) and an MBA from Northwestern University (2007 to 2008), Junqueira developed her skills at high-profile companies such as Booz Allen Hamilton, Boston Consulting Group and ItaĂş Unibanco before co-launching Nubank in 2013.
AUGUST 2020
Senator Position
World Business Angels Investment Forum Company
91
03
Anna Maj
A bona fide fintech leader, Anna Maj has spent her career teaching others how to get the most from digital/online financial services, as well as remaining a staunch advocate for inclusion, diversity and fairness within the sector. With a degree in Cultural Anthropology, an MBA and a PhD in Finance and Financial Management Services, the full list of Maj’s achievements can be difficult to sum up succinctly. Suffice it to say that she has authored two books (The PAYTECH Book and The AI Book), been recognised as one of the Top 25 Women Leaders in Financial Technology, has gathered over 20 years of banking and payments experience and has held leadership positions at Citibank, PwC, PayTel, mBank and more. f i nte c hma ga z i n e. com
E M E A | A P A C | | APAC N O R T H | A EMEA MERICA AMERICAS FIND OUT MORE
FIND OUT MORE
T O P 10
What’s Your Rate? | Marcus by Goldman Sachs® CLICK TO WATCH
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AUGUST 2020
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02
Sarrah Cherhabil Following the completion of her BEng degree in Electronic Engineering at the University of Central Lancashire, Sarrah Cherhabil has forged an enviable career which includes positions at some of the biggest names in finance or tech. Starting as an intern at IBM followed by an Analyst role at Atos and an Associate post at JP Morgan Chase, Cherhabil is now Vice President of Marcus, a subdivision of Goldman Sachs that offers customers straightforward savings accounts, best-in-class customer service and convenient digital solutions. With so much accomplished in such a short amount of time, Cherhabil is sure to be a key player in the future fintech sector.
VP at Marcus Position
Goldman Sach Company
f i nte c hma ga z i n e. com
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T O P 10
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AUGUST 2020
Judith Erwin
01
Judith Erwin exemplifies the innovative spirit which makes the fintech sector so exciting. Currently the CEO of Grasshopper, the US’ first digital commercial bank, her latest post is the most recent in a series of endeavours revolving around tech-focused financial services. Educated at Oregon State University and with more than 30 years of experience in commercial banking, Erwin was a founder of Square 1 Bank, a venture banking enterprise started in 2005 and eventually sold to Pacific Western Bank in 2015. Showing clear enthusiasm and dedication to fintech, she then became the Chief Operating Officer at New York-based company PEX for a short time, before finally settling into her current role in late 2016.
CEO Position
Grasshopper Company
f i nte c hma ga z i n e. com
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Transforming banking by building on the cloud WRITTEN BY
WILLIAM SMITH 98
AUGUST 2020
PRODUCED BY
JUSTIN BRAND
99
f i nt e c hma ga z in e. com
ATOM BANK
Rana Bhattacharya, CTO, Atom bank, guides us through the benefits of being a challenger, the response to COVID-19 and the company’s upcoming launch of its new banking platform
L
aunched in 2016, Atom bank was the first UK bank built exclusively for mobile, with the intention of never hav-
ing any physical branches. Its approach has won it significant plaudits, including a position in 100
Tech Nation’s Future Fifty, alongside being the number one rated UK bank on consumer review site Trustpilot. The company’s Chief Technology Officer, Rana Bhattacharya, is clear that part of the reason for its success is its smaller team and challenger culture. “We get a lot done with not a lot of people,” he says. “There’s a level of bureaucracy that’s removed, meaning you can make decisions quickly. And by virtue of that, small teams can accomplish brilliant outcomes and create changes and deploy them to production on the same day. As a digital native you have to embrace change. Whereas in some of the traditional banks, with the governance models and the people that have been there for a long time, it’s much harder for change to happen.” AUGUST 2020
101
Rana Bhattacharya, CTO, Atom bank f i nt e c hma ga z in e. com
ATOM BANK
“ Everyone just got on with it and made it work, and you can only do that if you already have the capability and the culture to make those things happen” — Rana Bhattacharya, CTO, Atom bank 102
Atom launched with marketleading Fixed Saver accounts and secured business lending for SMEs. It followed with mortgages in December 2016 and since then has taken £1.8bn in deposits and lent over £2.4bn to small businesses and homeowners. “We exist to create better outcomes for our customers,” says Bhattacharya. “We’re leveraging technologies to automate more and provide a first-class service to them. And by not having the baggage that some of the more traditional
AUGUST 2020
Welcome to Atom bank CLICK TO WATCH
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0:10
103 banks have, we can create material
and put Atom and our customers
savings to pass on to our customers.”
in control. For a bank that’s building
The bank is undergoing a techno-
itself for long-term sustainability
logical transformation, launching a
and delivering true customer value,
brand new banking platform more
investment in the right technology
in step with how the market has
is key.”
developed. “Cloud hosting of banking
“We’re heavily using DevOps, so
software wasn’t an option when Atom
IT4IT,” he says. “Historically if you
was authorised,” says Bhattacharya.
imagine an on-premise environment,
“As a business committed to taking
especially with a third party model, it
advantage of the very best systems to
can take up to 42 weeks, if you’re lucky,
run our bank, and with investors who
to commission a new instance. Now, on
are right behind our commitment to
the cloud using DevOps, we can stand
technology, we are adopting systems
up an instance of the bank on the cloud
that are built specifically for the cloud
in under a week. That gives you a lot f i nt e c hma ga z in e. com
“Working with Thought Machine has been revolutionary. The Vault platform is quick and agile. Its unique features enable us to bring new experiences to banking with velocity, all the while keeping quality high and costs low.� Rana Bhattacharya, CTO Atom bank
Request a demo
Powering Atom bank to reinvent banking
The revolutionary power of the cloud The world’s largest technology brands - Netflix, Spotify, Google - all operate exclusively on the cloud. Yet it’s a universal truth that the banking industry has been held back by legacy technology stifling innovation, and at huge costs. While banks accept that a move towards modern, cloud native systems is necessary, fullscale banking transformation can be daunting. Meanwhile, the next wave of challenger banks are able to start afresh and build their bank in the cloud.
The benefits of a Vault engine At Thought Machine, we created a product to power any bank. Our product is Vault, a cloud native, core banking engine. Vault was built by former senior Google engineers, and can be configured to run any type of bank and launch any type of product. Vault’s unique features enable banks to transmit their vision into the hands of the customers, while taking full advantage of the cloud. Innovation Vault’s hyper-configurable platform enables banks to reinvent customer experience as new features and interfaces can be designed and rolled out quickly and with more agility. Banks powered by Vault are ‘always up’, even during product launches.
Security Vault’s technology is designed to provide security through all levels of the infrastructure. If a server in the cloud malfunctions, another server is spun up to absorb the functions, ensuring that the bank doesn’t have to go offline. Meanwhile, data is encrypted creating superior analytics as banks can capture, store and view data to identify unusual behaviour. Automation Vault operates a highly automated DevOps environment – nearly everything traditionally done with manual intervention in a traditional data centre can be performed automatically. This means banks can regain control of their workflows, while keeping costs low.
Partnering with Atom bank Atom bank chose Vault to power its bank as they wanted a platform that would enable them to keep innovating at pace, just as they did when they brought biometrics to UK banking. Since partnering with Thought Machine last year, Atom bank has been leveraging Vault’s cuttingedge technology to streamline their workflows and bring new products to market with speed. Our teams will be working together to launch products designed with unique features to bring unseen experiences to the banking industry.
ATOM BANK
106
of capability by virtue of not being
offer us a managed service that we’ll
hamstrung by the number of environ-
be plugging into, but everything that
ments. The cost model is different
we manage and change ourselves
because effectively you can spin
will be hosted on the cloud. We’re
up an environment and once you’ve
effectively building a state-of-the-art
used it, you can kill it (treating envi-
bank hosted on Google Cloud.”
ronments as cattle, versus pets).” The Atom banking machine is what
The company is also leveraging emerging technologies for such
Bhattacharya calls the new cloud-
things as enterprise decision-mak-
based infrastructure and associated
ing, including pricing and financial
software components. “The majority
forecasting. “We’ve built an in-house
of the estate is being moved onto
machine learning model to inject
Google Cloud Platform. We’ll still
some insights into that. From an
have a number of third parties who
operations perspective, we use
AUGUST 2020
machine learning to support activi-
traffic by default alongside not trust-
ties like credit risk scoring, instant
ing the device. We always look to
pricing quotes for business banking,
leverage a zero-trust model, which is
and anti money-laundering identifi-
important as a bank,” Bhattacharya
cation and prevention.”
reiterates. “We have a continuous
For a bank, security is paramount,
security testing cycle using third
and Atom’s cybersecurity protection is
parties to give us more information
comprehensive. It utilises encryption,
about security threats from their
access control, vulnerability manage-
perspectives. Our security is strict,
ment, firewalling, DDoS scrubbing
it’s very tight and we clearly classify
amongst other security controls to
data as part of managing it, as well
protect its customers’ data.
as from a security perspective.”
“We look at the full stack in terms of protection the app, has encrypted
The technology Atom uses is in service of providing a better
E X E C U T I V E P R O FILE :
Rana Bhattacharya Title: Chief Technology Officer Company: Atom bank Industry: Financial Services Location: Durham Recognised by Computing as one of the top 250 IT Leaders in 2019, and a member of the Executive Committee at Atom since April 2017, responsible for IT, Change and Programme Management. Rana has experience in large-scale systems development and delivery success for major players in the finance sector. Before joining Atom, Rana held roles such as Chief Architect at Nationwide Building Society and Senior Manager for Architecture and Delivery at Accenture. f i nt e c hma ga z in e. com
107
How does Atom bank make digital identity journeys fast, safe, and seamless? Since 2014, Daon has partnered with Atom in pioneering biometric banking in the UK, leading the way as the first app-only bank and the first to use face and voice biometrics for account login. With best-in-class biometrics and biometric liveness through Daon’s IdentityX® platform at its core, Atom delivers a fast, safe, and seamless experience to all users, everywhere, independent of their personal device’s features or limitations. From account creation to authentication, customers are in control of their own digital identity journeys with the least friction and the most security. It’s no wonder Atom is the UK’s most trusted bank according to Trustpilot.
1 billion+ 100 million+ 160+ 150+ 100+ 20+
identities we’ve been chosen to secure authentications performed each day groundbreaking biometric technology patents major financial institutions using our technology biometric algorithms we’ve road tested from 75+ vendors years as the most trusted name in biometric identity assurance
The World’s Most Trusted Identity Journeys • www.daon.com
“ I’m proud of Atom and proud of my team to have been able to get us to where we are now” — Rana Bhattacharya, CTO, Atom bank
away from using Unity for our mobile apps, which is more of a gaming platform, rebuilding it on native technology, running faster with a new UX. And that’s been quite well received. There’s still some improvements to make, but on iOS, we now have an app store rating of 4.6.” Google is a significant partner for Atom, with their relationship serving as a model for how Bhattacharya
customer experience, both directly
approaches suppliers and partners.
and indirectly. “We’re transform-
“Google not only provides us with
ing, not just from a technology
infrastructure but elements of data
perspective, but also by taking on
and other capabili-
more internal accountability,” says
ties. For us, it was
Bhattacharya. “We’re insourcing
quite an impor-
more, meaning that Atom can make
tant decision to
key changes across its IT estate
choose a cloud
without external resource require-
vendor.
ment enabling a greater pace of change. And this is the power behind Atom’s banking machine which fuses technology, people as well as data to provide benefits to our customers.” Other customer-centric achievements include the resolution of 97% of support tickets within SLA, and the improvement of its apps. “In December of last year, we moved f i nt e c hma ga z in e. com
109
ATOM BANK
110
AUGUST 2020
As we moved to the cloud, we wanted a partner, not a supplier, someone to engage with us as an entity, work with and help us. We felt having a partner - a real partner - was 50% of the transformation, someone on your side to help you succeed. And that’s what we found in Google.” Atom has found other partners to boost capability in other areas, as Bhattacharya explains: “Thought Machine has a pivotal role to play within our transformation. We’re looking to run Thought Machine as a cloud native, smart contractbased core banking platform on Google. What that will allow us to do is basically define any type of product we could imagine - and do this in house. As part of our launch in 2016, we partnered with DAON and pioneered the use of biometrics in the UK banking industry and led the way with face and voice biometrics as core credentials to log-in to your bank. As a team we continue to make improvements because we’re committed to exceptional customer experiences.” f i nt e c hma ga z in e. com
111
ATOM BANK
The ongoing COVID-19 pandemic is putting a strain on business worldwide, uprooting long-established ways of doing business. Bhattacharya emphasises the need for understanding during these difficult times, saying: “You have to put more emphasis on bilateral and team communications, as well as wellness. In terms of my team and colleagues, the current pandemic has brought a different perspective on life and the need to ensure, yes 112
you get the work done, but also that people are well and healthy both physically and mentally.”
“ By not having the baggage that some of the more traditional banks have, we can create some material savings to pass on to our customers” — Rana Bhattacharya, CTO, Atom bank
Bhattacharya credits the company’s resilience to its employees. “I think it’s a testament to the folks in our team. We implemented home working very rapidly - before the official lockdown came into place. In terms of our security and the networks team, within a two to three week period, they got all of our employees working from home successfully, including the contact centre. I don’t think we would be able to support and service our
AUGUST 2020
113
customers the way we have been
with a small number of people and
able to, if we hadn’t had that inherent
a comparatively small budget is sig-
capability in the bank. Everyone just
nificant. I’m proud of Atom and proud
got on with it and made it work, and
of my team to have been able to get
you can only do that if you already
us to where we are now, closing off a
have the capability and the culture to
few items to get us ready to go live.”
make those things happen.” As Atom comes close to going live with its Banking Machine, Bhattacharya is clear that it has been down to the dedication of his team in challenging and uncertain circumstances. “What we’ve done f i nt e c hma ga z in e. com
114
DHL EXPRESS: DRIVING FINTECH INNOVATION IN AFRICA AUGUST 2020
115
WRITTEN BY
GEORGIA WILSON PRODUCED BY
JUSTIN BRAND
f in t e c hm a g a z in e . c o m
DHL EXPRESS SOUTH AFRICA
BUSINESS CHIEF EMEA/FINTECH MAGAZINE LOOKS AT THE FINTECH LANDSCAPE IN SOUTH AFRICA AND HOW DHL IS CONTRIBUTING TO THE INDUSTRY’S INNOVATION ACROSS THE AFRICAN CONTINENT THE HISTORY OF DHL Founded in 1969, by Adrian Dalsey, Larry Hillblom and Robert Lynn, DHL began operating one of the first international door-to-door express delivery services, not long after Neil Armstrong became 116
the first man to step on the moon. The three men’s business idea, ‘altered the global economy’, forming ‘the cornerstone for global operating enterprises’. The founding of DHL represented the creation of the international air express service industry, which rapidly transported documents and cargo papers by plane. In 2002, DHL became a wholly owned subsidiary of Deutsche Post.
STRATEGY 2025: DELIVERING EXCELLENCE IN A DIGITAL WORLD For many years, DHL has been successful in deploying and achieving its business strategies. Following the end of its ‘Strategy 2020’, the company has established its latest iteration – Strategy 2025: deliver excellence in a digital world.
AUGUST 2020
117
f in t e c hm a g a z in e . c o m
DHL EXPRESS SOUTH AFRICA
“ WE NEED NOT REINVENT OURSELVES, WE WILL DIGITALISE OURSELVES” — Frank Appel, CEO, Deutsche Post DHL Group
to embrace the fast-paced world of changing technologies. While DHL continues to innovate within the logistics, supply chain and manufacturing sectors, one area that DHL is delving into is the fintech industry. With many large organisations in South Africa focused on digitalisation as a strategic goal to ensure sustainable and efficient businesses for the future, DHL is committed to continuous improvements. To navigate the fintech industry in South Africa, organ-
118
“Deutsche Post DHL Group has
isations must therefore understand
never been in better shape. We are
the large focus on digitalisation and
convinced that future growth will come
automation to drive efficiency, accu-
from a consistent focus on our profit-
racy, quality and compliance within
able core logistics businesses – and
the industry.
digitalisation will become the greatest lever,” said Frank Appel, CEO of Deutsche Post DHL Group, “we need not reinvent ourselves. We will digitalise ourselves.” Accompanying this innovative mindset, are DHL’s innovation centers in Germany, Singapore and America. At these centres, the company is continuously focused on exploring new concepts, technologies and methodologies in order to allow countries AUGUST 2020
DHL e-commerce: Mall for Africa CLICK TO WATCH
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THE BENEFITS OF FINTECH FOR THE SUPPLY CHAIN INDUSTRY
suppliers may provide discounts such
Innovations in financial services
as cost of capital which can help
technology can bring several benefits
to fund growth and expansion into
to the supply chain, including:
new markets.
1. Extending accounts payable
2. Inventory orders and resupply
Typically, fintechs have relationships
In exchange for using fintechs,
Using fintechs can also provide an
with multiple banks and financial insti-
easier way of reordering inventory
tutions. As a result they can act like a
quicker, reducing manual and sporadic
broker for finance for supply chains,
reorders. Rather than reaching out to
financing the transaction between the
individual suppliers, fintech solutions
buyer and the supplier, allowing more
can allow supply chains to schedule
time to make a payment.
and streamline operations. f in t e c hm a g a z in e . c o m
DHL EXPRESS SOUTH AFRICA
1969
Year founded
HQ
Bonn Germany
760+ 120
Number of employees
AUGUST 2020
121
“ CONSUMERS WILL FINALLY HAVE AN ALTERNATIVE THAT GIVES THEM PEACE OF MIND BY ENSURING THAT THEY ONLY PAY FOR GOODS AFTER THEY HAVE RECEIVED THEM” — Hosam Arab, Co-founder and CEO, Tabby
f in t e c hm a g a z in e . c o m
3. Faster payments, consistency
DHL’S FINTECH INNOVATION
and ease for the supplier
Breaking into the fintech space, DHL – in the last few months – has been
Adopting fintech solutions as a sup-
partnering with leading fintech com-
plier allows for quicker and cheaper
panies to provide innovative payment
methods of acquiring payments, as
solutions to its customers.
well as faster reorders allowing for improved scheduling and being more
DHL AND PAYFORT
accessible and visible to buyers.
Towards the end of 2019, DHL
Other benefits for the supply chain
announced a new partnership
industry include finance opportuni-
between DHL Express (North Africa)
ties for equipment and inventory.
and Amazon’s PAYFORT, to provide
Within logistics and supply chain
its customers in the region the abil-
there is a consistent need for inven-
ity to complete shipment solutions
tory and equipment, however the
online and in their local currencies,
procurement process comes with
while protecting them against fraud
challenges. With fintech evolving at a
and other security concerns.
fast pace the procurement process is expected to become easier and more productive. While buyers and suppliers can benefit from fast and easier payment methods, so can drivers. Fintech solutions can provide the capability for digital check deposits and digital payment transfers to pay drivers. Finally, supply chains and logistics can benefit from the digitalisation of the manual billing process and invoicing services that fintechs can provide. f in t e c hm a g a z in e . c o m
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DHL EXPRESS SOUTH AFRICA
124
AUGUST 2020
“ THE ERA OF DIGITALISATION AND ECOMMERCE IS ON THE RISE AND IS TRANSFORMING TODAY’S WORLD INTO A CASHLESS SOCIETY” — Ali Thabet, Regional Director-eCommerce MENA, DHL Express
The partnership aligned with PAYFORT’s mission to build robust payment experiences in the MENA region, as well as simplify the process for thousands of customers that trust DHL to deliver their time-sensitive shipments. It covered eight countries including Egypt, Jordan, Lebanon, Kuwait, Oman, Qatar, Saudi Arabia, and the UAE “The era of digitalisation and ecommerce is on the rise and is transforming today’s world into a cashless society. At DHL Express MENA, we provide different online solutions that facilitate shipping and logistics for both businesses and individuals,” f in t e c hm a g a z in e . c o m
125
DHL EXPRESS SOUTH AFRICA
“ CONSUMERS WILL FINALLY HAVE AN ALTERNATIVE THAT GIVES THEM PEACE OF MIND BY ENSURING THAT THEY ONLY PAY FOR GOODS AFTER THEY HAVE RECEIVED THEM” 126
— Hosam Arab, Co-founder and CEO, Tabby
commented Ali Thabet, Regional
of its most recent partnerships in the
Director-eCommerce MENA at DHL
fintech industry, with Dubai-based
Express. “Cashless payments provide
fintech Tabby to provide customers
more security and faster transac-
with an alternative to cash on delivery
tion time for businesses and offer
(COD).
consumers more convenience and
Ecommerce businesses which use
flexibility when sending and or receiv-
DHL’s services can provide customers
ing shipments.”
with Tabby’s ‘Pay Later’ option, allowing customers to checkout without
DHL AND TABBY
providing a credit card when making a
In June 2020, DHL announced one
purchase. “Consumers will finally have
AUGUST 2020
127
an alternative that gives them peace of
proprietary decision engine will help
mind by ensuring that they only pay for
our customers capture business
goods after they have received them,”
opportunities that they may have
commented Hosam Arab, company’s
otherwise lost,” added Geoff Walsh,
co-founder and CEO at Tabby.
UAE Country Manager at DHL Express,
“Our partnership with Tabby demon-
commenting on the occasion.
strates DHL’s continued commitment to delivering value to our e-commerce customers, as they are currently operating in a challenging and volatile business environment. Tabby’s f in t e c hm a g a z in e . c o m
128
ARAB NATIONAL BANK: WHERE EXPERTISE MEETS REPUTATION WRITTEN BY
WILL GIRLING PRODUCED BY
JORDAN HUBBARD
AUGUST 2020
129
f in t e c hm a g a z in e . c o m
A R A B N AT I O N A L B A N K
One of the largest banks in the EMEA region, Arab National Bank has created a legacy based on expertise, innovative services and customer trust
F
ounded in 1979, Arab National Bank (ANB) has risen in stature to become one of the top banks in the Middle East region.
Having taken over operations of the pre-existing ‘Arab Bank in the Kingdom of Saudi Arabia’, ANB relocated its headquarters to the country’s capi130
tal of Riyadh, with regional offices in Jeddah and Khobar and an established international presence in London, UK. Serving over two million customers via a workforce of 3,770 people in 156 branches, the bank continues to pursue a customer-centric goal which has become enshrined as its corporate motto and mantra: to be “a friend indeed” to its clients. Not content with merely offering a limited suite of products, ANB prides itself on a comprehensive portfolio of personal, commercial and investment services. Catering to its customers’ daily needs, the bank operates 1,240 ATMs, 18,000 POS terminals and a 24/7 customer service centre. In addition, fully embracing the possibilities of e-banking and online digital facilities, ANB’s customers can manage their money on a laptop, smartphone or via a ‘digital branch’. The bank’s AUGUST 2020
131
f in t e c hm a g a z in e . c o m
A R A B N AT I O N A L B A N K
“ The bank continues to pursue a customercentric goal which has become enshrined as its corporate motto and mantra: to be “a friend indeed” to its clients”
accounts can also be connected with Apple Pay and Mada Pay for fast contactless payments, a practical necessity which has taken on particular importance since the COVID-19 pandemic made the handling of physical cash a potential health hazard. For payment transactions outside of Saudi Arabia, ANB offers its TeleMoney Service which has been facilitating long-distance payments since 1992. Customers can transfer money to 95 global locations, including India,
132
Pakistan, Indonesia, Egypt and more.
AUGUST 2020
Saudi National Day at Arab National Bank CLICK TO WATCH
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1:51
133 No less flexible or inclusive with
developing products that are compat-
corporate clients as it is with individu-
ible with the Islamic Shariah Principles
als, ANB is experienced at providing
of banking. Currently offering two such
financial products and services to
services - morabaha and tawarruq - all
large and medium-sized enterprises,
of its new output will be carefully moni-
particularly in the manufacturing, trad-
tored and reviewed by a dedicated
ing and IT sectors. Services include
Committee for compliance.
but aren’t limited to: short, medium and
Receiving widespread industry
long-term loans, bill payments, bonds
praise for the quality of its overall
and letters of credit. Although a large-
performance, ANB continues to excel
scale, international operation, ANB still
through a focused drive that empha-
manages to offer clients a personal
sises strong relationships with
service by assigning each company an
investors and a progressive stance
officer to act as a consistent point of
on implementing the latest financial
contact. The bank is in the process of
services technology. Upon receiving f in t e c hm a g a z in e . c o m
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135
“ No less flexible or inclusive with corporate clients as it is with individuals, ANB is experienced at providing financial products and services to large and medium-sized enterprises”
Argaam’s ‘Top Performing Fund’ award for its ‘Al-Arabi Saudi Equity Fund’, Bassam AlMubarak, CEO of ANB Invest (the Group’s investment arm) commented, “We are proud to bring this coveted award home from among all Saudi Equity Funds. The award speaks to the knowledge, expertise and outstanding performance of the Company’s team.” Additionally, upon ANB’s winning the ‘Best Retail Bank in Saudi Arabia’ category at the 2019 World Finance awards, Dr Robert Eid, Managing f in t e c hm a g a z in e . c o m
A R A B N AT I O N A L B A N K
1979
Year founded
$673mn+ Revenue in US dollars
3,770 136
Number of employees
AUGUST 2020
137
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“ ANB makes it clear that the best banks do not simply focus on growing their own brand, but rather contribute to the economic and social development of the country they operate in”
Director and CEO of Arab National Bank, was said to have “expressed his pride in this achievement, which is a result of the bank’s relentless efforts of investing in cutting edge technology, expanding the digital branch network and developing ADCs to keep pace with the digital transformation in line with the Kingdom’s Vision 2030.” ANB makes it clear that the best banks do not simply focus on growing their own brand, but rather contribute to the economic and social development of the country they operate in. Established as one of Saudi Arabia’s
General management of Arab National Bank CLICK TO WATCH
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0:30
f in t e c hm a g a z in e . c o m
139
A R A B N AT I O N A L B A N K
140
“ ANB is an organisation based on decades of expertise, a fundamental grasp on the direction that banking is travelling towards and most importantly trust�
premier project financiers, ANB possesses an innate understanding of the local market, its regulations and available opportunities. As such, it is able to offer end-to-end support on every aspect of project finance, from arranging loans to debt syndication and agency services. Other services include credit products, bridge loans, hedging facilities and more, all with the capacity to be fully Shariahcompliant if needed.
AUGUST 2020
141
ANB is an organisation based on
to support its aspirations. As the
decades of expertise, a fundamental
financial services market continues
grasp on the direction that banking
to change in new and unpredict-
is travelling towards and most impor-
able ways, ANB will remain at the
tantly trust. “Our promise is to earn
forefront by applying its persistently
your friendship by being transparent,
high-quality standards to the latest
committed and making sure you are
technology-driven trends, ensuring
always satisfied,� it says on the web-
that its customers receive some of the
site. With a BBB+ S&P rating and net
best banking experiences available,
profit of USD$947mn for 2019 (up
not just in Saudi Arabia but the world.
7.3% on the previous year’s figure), the bank has strong, healthy credentials f in t e c hm a g a z in e . c o m
142
Absa Bank: a digital bank for the African continent
JOHN O’HANLON PRODUCED BY JUSTIN BRAND WRITTEN BY
AUGUST 2020
143
f in t e c hm a g a z in e . c o m
A B S A R E G I O N A L O P E R AT I O N S
Vimal Kumar, Chief Executive: Retail & Business Banking, Customer Experience and Digital – Absa Regional Operations, discusses reimagining the future of banking in Africa
N
othing is going to be the same again after COVID-19 releases its grip on the world. While nobody can predict what the ‘new
normal’ will look like, Vimal Kumar, Chief Executive: Retail & Business Banking, Customer Experience and Digital – Absa Regional Operations, is clear about one 144
thing: the response must be digital. “COVID-19 has highlighted the importance of digital solutions,” says Kumar. “The investment we made over the past few years in the digital transformation of our businesses across the continent enabled us to better respond during this time of crisis. As a modern, future-forward African banking group, a key pillar in our strategy is finding scalable solutions and platforms that continue to meet the evolving needs of our customers.” Kumar believes that technology will be the driver of this new type of economy. Regional and local trade mechanisms are likely to replace global supply chains, he suggests, and the most successful financial institutions will be those which can promote digital channels most efficiently, making them cheaper to use, cutting or waiving transaction fees and enabling cashless payments and e-commerce. AUGUST 2020
145
f in t e c hm a g a z in e . c o m
A B S A R E G I O N A L O P E R AT I O N S
“ Instead of the slow march to digital transformation in the payment space, we are going to see many years of change condensed into a few months” — Vimal Kumar, Chief Executive: Retail & Business Banking, Customer Experience and Digital – Absa Regional Operations
conversational AI. Secondly, instead of the slow march to digital transformation in the payment space, we are going to see many years of change
While being realistic about the difficul-
146
condensed into a few months. Thirdly,
ties ahead, Kumar thinks the benefits
our employees must become mentally
of the Big Data and analytics journey
aligned to operate cohesively in a remote
the bank embarked on following the
and alternative working environment;
commencement of its separation from
most if not all organisations in the future
Barclays PLC in 2017 and it’s rebrand-
will need to find alternative solutions to
ing in 2020, stands it in good stead.
accommodate their workforce other
“As we come out into a new world
than physical environments for the next
post-pandemic, we are going to have to
few years. Fourthly, and central to future
accept fundamental shifts in consumer
success is the need for leaner, scalable,
behaviour. From my retail and busi-
low-cost-to-serve business models.”
ness banking perspective, I can see a
Absa Group’s new brand has been
number of positives. Firstly, massive
inspired by the African continent and its
uptake on alternative channels like
people, and the desire to unite under
e-wallet, e-commerce, contactless and
a single purpose – to bring possibility to life. The group’s shared-value approach reflects its ambition to become a purpose-driven financial services organisation creating substantial social impact through core business functions, while also delivering shareholder value.
AUGUST 2020
Get It Done CLICK TO WATCH
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147 “One of the key pillars of our new
to collaborate with fintechs and startups.
growth strategy is to build a scalable
“As we progress along our digital journey,
digitally-led business,” says Kumar. “Our
we will continue to focus on change that
aspiration is to become an African bank-
brings value to our customers,” Kumar
ing group with global scalability. Our
explains. “And, because we recognise
motto is to ‘Bring Possibilities to Life’
the cultural change that a digital transfor-
and, as a result, pushing digital bounda-
mation entails, we are already taking the
ries to become customer-obsessed is
initiative to empower, engage and make
at the core of our focus.”
our 9,000+ employees in our African
There is a high degree of awareness around the fast changing landscape
regional operations future-ready. “Very much a part of this process was
at Absa Group and efforts are being
during our rebranding to Absa Bank,
made to accelerate the transformation
we unveiled the artificial intelligence (AI)
journey by opening up the group’s legacy
powered humanoid prototype called
systems through microservices/APIs
Abby – Smart Banking Humanoid in our f in t e c hm a g a z in e . c o m
A B S A R E G I O N A L O P E R AT I O N S
“ I truly believe we can become a customercentric organisation by driving personalised experiences through a combination of data and digital” 148
— Vimal Kumar, Chief Executive: Retail & Business Banking, Customer Experience and Digital – Absa Regional Operations
Mauritius market that allows customers
Kumar is also enthusiastic about the
to self-service their banking transactions
chatbot that now sits on the website
and queries at branches 24/7. It works
and is also available on WhatsApp
on both voice commands and keyboard
Messenger across the African busi-
inputs and uses advanced NLP capabili-
nesses. Powered by deep AI that
ties to understand customer intent and
supports customers through intelligent
respond accordingly. After registration,
conversations, it is capable of doing
it recognises customers through face
most of the things that mobile or internet
recognition and allows them to place
banking can do. This virtual assistant
transactions with a secure PIN set
was developed with the help of US
during the registration process. The
fintech Kasisto and the South African
humanoid also has autonomous navi-
enterprise tech company Blue Turtle.
gation capabilities.”
“We looked at many providers but liked
AUGUST 2020
the Kasisto option because it was a good
been a major disruptor in the payment
fit for what we needed. It is already live in
space between traditional financial
all our markets and will soon have trans-
services providers and disruptors.
actional capabilities – you can tell it to
“They give consumers a fast, secure,
make a payment and the bot will identify/
low-cost method to use, store and send
verify you and complete the transaction.”
money over the internet,” says Kumar.
Another huge step towards becoming
“Our wallet program envisages a banking
a truly digital bank located in the cloud
app that allows customers to open an
is happening right now at Absa with the
account, apply for lending, create sav-
rollout of wallet banking, scheduled to
ings products, pay a bill, and purchase
launch in some markets from August.
airtime amongst other things – all from
Digital wallets or mobile wallets have
their mobile. I am very excited about this 149
E X E C U T I V E P R OF IL E :
Vimal Kumar Title: Chief Executive: Retail & Business Banking, Customer Experience and Digital
Industry: Finance Services
Location: South Africa
Vimal Kumar is the Chief Executive of Retail and Business Banking, Digital and Customer Experience for the Absa Regional Operations, at Absa Group Limited, overseeing the RBB franchises across nine markets: Zambia, Botswana, Ghana, Kenya, Uganda, Mozambique, Tanzania, Mauritius and the Seychelles. He joined the group as the Head of Lending in 2011, based in its offices in Dubai where he provided strategic leadership direction. He has over 25 years of experience in Retail and Business Banking, including credit cards, consumer loans, retail liabilities and wealth management, having worked in Asia, the Middle East and Africa. f in t e c hm a g a z in e . c o m
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“ We will continue to invest in emergent technologies like AI, ML and IoT wherever they have the potential to improve life for people as well as back office efficiency — Vimal Kumar, Chief Executive: Retail & Business Banking, Customer Experience and Digital – Absa Regional Operations
the future, to be expanded and made more multifunctional. Since Absa became independent, Kumar has become increasingly
because it’s customer-centric, meet-
convinced that technology is more
ing a need that is felt in all our markets.
effectively and quickly implemented
It helps us deliver banking capability
by involving partners than by building
at a very low cost to segments that
it in-house. “We have an accelerator
are difficult to serve through the
programme where we incubate up to
branch network.”
15 fintechs at any one point. We started
Importantly, it extends financial
working with some of those companies
access, as Kumar explains. “We want
because they were building technologies
to make it easy for new customers to join
specifically to solve customer problems
the financial ecosystem. Wallet banking
in Africa. Our biggest success so far
brings together a couple of cool things.
has been Jumo, which has built mass
One is that it helps us penetrate the
data and analytics, and credit assess-
mobile money ecosystem effectively;
ment capability, working in Africa with
it creates a partnership opportunity with
mobile lending operators over the
other fintechs and with the mobile net-
last eight years. It is very smart, it can
work operators – the kind of partnership
onboard and assess customers, and
that will be so important going forward.
lend to them based on a multivariate
It also helps us onboard customers in a
scorecard that ranks risk.”
non-physical way so they can either use the self-KYC (know your customer) facility or onboard via an agent. They need never come into a branch.” Wallet banking, Kumar says, is an investment in f in t e c hm a g a z in e . c o m
151
A B S A R E G I O N A L O P E R AT I O N S
152 This technology chimes with Kumar’s
that directly links agri-trade activity with
vision to reach new segments of soci-
financial services. The farmer can offer
ety – people who might never come
his or her supply and the buyer can pur-
into a bank branch. Absa is now work-
chase electronically at an agreed price.
ing with Jumo in Zambia, Ghana, and
Since so much of the African economy
very soon Tanzania and Uganda too,
comprises small-scale agribusinesses,
within the mobile money ecosystems
this is a sector Kumar is particularly
there, allowing customers to save and
keen to excel in, and this marketplace
borrow money.
capability is proving very successful.
The innovation accelerator,
Africa’s diaspora is marked by a
WorkinProgress, was founded in 2015
great need for effective and fast remit-
and is based at Cape Town. It provides
tance structures, but aside from large
facilities and support for startups.
money transfer operators, there are
Another highly relevant partner to have
few options, Kumar continued. “We are
come from it is Avenews-GT, an Israeli
evaluating a fintech partnership and
fintech that has digital infrastructure
in parallel have also built an in-house
AUGUST 2020
on their mobile and charge it back to us.”
“ I am very excited about wallet banking because it’s customer-centric, meeting a need that is felt in all our markets” — Vimal Kumar, Chief Executive: Retail & Business Banking, Customer Experience and Digital – Absa Regional Operations
This, he says, will push mobile access, data being an expensive commodity for Africans. The investment Absa has put into data is now paying off. The bank won the 2019 award for Best Technology Initiative at the Financial Innovation Awards in London for its data analytics platform, which tackles the issue of data availability in banking, especially in emerging markets. “Customer360 (C360) presents data with a lot of visualisation and interactivity. There’s
mobile based remittance solution
gamification and machine learning
called Novo Fx. Again, this is something
capability – again, it puts customers
our customers are really in need of.”
at the heart of our strategy. I truly
Partnerships like these in a targeted
believe we can become a customer-
way reach out to a huge untapped
centric organisation by driving
customer base. In 2016, Absa was
personalised experiences through a
the first bank to offer South African
combination of data and digital. And
customers reverse billing over all big
the employees are as much a part
four networks, allowing the MNOs to
of the journey as the customers are.
charge data costs back to Absa. “I
Digital transformation is only possible
want our customers to never pay for
if we can get our colleagues on the
data either while using the Absa app or
same page,” he concludes.
website. Again, we are in very advances stage of discussions with an exciting technology company to aggregate the data customers use in accessing Absa f in t e c hm a g a z in e . c o m
153
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