Global Banking & Finance Review Issue 42 - Business & Finance Magazine

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Editor Wanda Rich email: wrich@gbafmag.com

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Dear Readers’

Global Banking & Finance Review was saddened to learn the news of the passing of Her Late Majesty Queen Elizabeth II on September 8, 2022, at the age of 96. Her Late Majesty Queen Elizabeth II was the longest reigning monarch who sat on the throne for over 70 years. Global Banking & Finance Review send their condolences to the royal family and all of Britain.

Featured on the front cover is Dr Adesola Adeduntan, CEO and Managing Director, First Bank of Nigeria. First Bank of Nigeria Limited is a multinational bank and financial services company based in Lagos, Nigeria. It boasts an extraordinary 128year history and is the region’s foremost financial inclusion services provider, having won multiple Global Banking & Finance Awards including ‘Best CSR Bank Western Africa’ and ‘Best Corporate Bank Western Africa’ this year. I recently interviewed CEO and Managing Director of First Bank of Nigeria, Dr Adesola Adeduntan, to find out more about how a bank of such esteem and award-winning success maintains its position as a pacesetting powerhouse. Read the full interview on page 24 where we explore digitisation, customer relations and the impact of effective CSR initiatives.

We strive to capture the latest news about the world's economy, financial events, and banking game changers from prominent leaders in the industry and public viewpoints with an intention to serve a holistic outlook. We have gone that extra mile to ensure we give you the best from the world of finance.

Send me your thoughts on how I can continue to improve and what you’d like to see in the future.

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Wanda Rich Editor

The purchaser or reader of this publication assumes all responsibility for the use of these materials and information. However, the publisher assumes no responsibility for errors, omissions, or contrary interpretations of the subject matter contained herein no legal liability can be accepted for any errors. No part of this publication may be reproduced without the prior consent of the publisher editor

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40

BANKING

How a customer centric approach can help banks support consumers with money worries

Brandon Aitken | Global Business Director | Financial Services Sector Webhelp

Firstsource 42

Winning customers – the five challenge areas for traditional and challenger banks

Venugopala Dumpala | Practice Head Banking & Financial Services

12

BUSINESS

The confidence crisis - how organisations can better tackle ESG reporting

Mandi McReynolds | Global Head of ESG, Workiva

Rohan Widdison | Founder & CEO New Labs 20

How to survive an economic downturn: a beauty industry veteran’s hard-earned tips

28

INVESTMENT

Is ESG investing becoming the new norm?An insight into ESG investing and what this means for the future of business

David Gow | Director Acumen Financial Planning

A road map for capitalizing on a growing HNWI market

Gareth Wilson | Head of Banking and Capital Markets UK Capgemini

FINTECH

How AI-powered conversation intelligence transforms CX for financial services companies

Rich Wang | VP, Customer Success Observe.AI

How fintechs are shaping the future of finance

Patricia Haynes | VP, tech ops and delivery Zopa bank Tadas Bakutis | CTO Connect Pay Elliot Locke | Co founder/CEO Abroaden

TECHNOLOGY

Three ways the insurance industry can use technology to stay ahead

Jay Chitnis | Senior Business Consultant Endava

Digital transformation with an API-First approach in finance

Rory Blundell | CEO Gravitee

INTERVIEWS CONTINUNED...

08

OCBC Securities’ MD on Becoming Singapore’s Brokerage Partner of Choice

Wilson He Managing Director

OCBC Securities

Advancing on a Cloud: Driving Digital Transformation in Financial Crime

Craig Costigan

CEO

Advancing on a Cloud: Driving Digital Transformation in Financial Crime

NICE Actimize

Craig Costigan

CEO

NICE Actimize

Credicorp Capital Colombia's Managing Director on Social Responsibility and Supporting Customers Through Turbulent Times

Ana María Giraldo

Managing Director of Corporate Finance

Credicorp Capital Colombia

FirstBank CEO on Digitisation, Customer Relations and the Impact of Effective CSR Initiatives

Dr Adesola Adeduntan CEO and Managing Director First Bank of Nigeria

INTERVIEW

OCBC Securities’ MD on Becoming

Singapore’s Brokerage Partner of Choice

Established in 1986, OCBC Securities is a leading brokerage firm in Singapore with more than 35 years of experience. A wholly owned subsidiary of OCBC Group, OCBC Securities has a wide network that gives it the leverage to grow a rich portfolio of products and services with capabilities to serve customers ranging from retail to corporates and institutions.

Wilson He has been the Managing Director of OCBC Securities since April 2020. He took up the position just as Singapore entered a COVID-19 lockdown and guided the company through a myriad of infrastructural changes during that period. He brings with him more than 18 years’ worth of experience in the financial services industry, with particular expertise in the area of digitalising securities trading.

OCBC Securities’ award-winning record includes the Global Banking & Finance awards for Best Mobile Trading Platform and Most Innovative Trading Platform in 2022. Editor Wanda Rich spoke to Wilson to find out what drives this success and about some of the competitive advantages on offer to OCBC Securities’ client base.

“As a global brokerage, we provide access to 31 international exchanges, with online access to 15 exchanges,”

Wilson said. “Our digitalised services allow customers themselves to trade, and at the same time, our dedicated Trading Representatives continue to assist them when they need further guidance.”

As he went on to explain, the current state of the securities market in Singapore lends itself to a number of challenges but also opportunities. “Whilst new entrants such as fintech brokers present a challenge, they also shed light on opportunities in the market at the same time,” he said. “Our competitors help us to understand our customers in new ways and drive us to improve ourselves and keep up with their needs. These days, customers demand convenience and consolidation of products and services for quicker transactions.

“To be the partner of choice for a holistic wealth proposition, we have integrated our trading platforms with OCBC Bank’s internet and mobile banking platforms, which allow customers to trade and bank in one place.

This is just one way in which we allow customers to manage both their equities portfolio and wealth at the same time.”

He did emphasise, however, that this focus on technology does not detract OCBC Securities from remaining service-oriented. “Aside from being a high-tech brokerage, we also maintain a high-touch approach and seek to upskill our equity salesforce to better assist customers, particularly when markets are volatile.

“Be it technology, service or product, innovation remains the core of our operations. In the year under review, we will continue to innovate on multiple fronts, developing new capabilities, products, and services to provide our customers a much more personalised experience, and continue enhancing our platforms to improve the synergy of offerings within the OCBC Group.”

With client relations at the core of its operations, OCBC Securities has taken careful measures to ensure that customers are receiving the best experience available.

“As we are committed to a customercentric strategy, the redesign of our iOCBC platforms naturally revolved around the primary focus of providing our customers with what they need as well,”

Wilson commented. “To find out what type of trading experience our customers are looking for, we use a human-centred design process. This means we host customer labs where we speak to our customers personally to understand their motivations, pain points and delight points. Conducted frequently, in detail and with different customer groups, they allow us to discover customer behaviours across various customer segmentations. Using such insights, we are then able to formulate trading platforms that are catered to their needs.”

In doing so, they learned that during trading, when every second can make a difference to one’s trading move, customers favour the availability of all essential features in a single place. “We designed an order ticket where key details can be viewed in one holistic look before customers place a trade. We also upgraded our platforms with a more comprehensive set of trading tools so that customers would not have to navigate to multiple places to perform their technical analysis. The portfolios have been revamped to reflect real-time values and even include corporate action adjustments.

“The above changes were made in direct response to what customers have voiced in our interviews with them. We are delighted that the end result is an enhanced trading experience tailored to customers’ needs to help them capture their market opportunities.”

Our Digital Platforms and Marketing teams who led the revamp of the iOCBC trading platforms.

INTERVIEW

Wilson upheld that progress is ongoing, and that OCBC Securities will continuously strive to make improvements.

"We are working closely with analysts from the OCBC Group Data Office to derive insights from extensive data on customer behaviour to achieve this. This AI development aligns with OCBC Securities’ goal of cultivating a datadriven culture and will help to solidify our position as a leading brokerage that keeps ahead of trends.”

He explained how customer labs have been conducted not just before the enhancements of the platforms, but during the upgrade and after completion to review customers’ takes on the changes and monitor how well these enhancements are being received. “We are delighted that the responses have been positive and encouraging, with many citing along the lines of the platforms being smooth, intuitive, user-friendly, and speedier than its predecessor,” he confirmed. “We also hear of customers describing an ease in placing their buy and sell orders in which their transactions are fuss-free and informative. The enhancement to reflect real-time values in customers’ portfolios is well-received as well.”

Additional ways in which investors can capture market opportunities have also been pursued by the Products team, including innovative tradable products. “Over the past two years, we have been curating a suite of unique ETFs by establishing partnerships with different stakeholders,” Wilson explained. “We started off with a collaboration within the OCBC Group, the Lion Global Investors. To date, we have minted three ETFs under the Lion-OCBC Securities branding. This includes the Lion-OCBC Securities Hang Seng TECH ETF, Lion-OCBC Securities China Leaders ETF and Lion-OCBC Securities Singapore Low Carbon ETF.

“These ETFs that aim to capture the potential of various industry leaders are in line with our strategy of expanding our product line to fulfil our customers’ objective of portfolio diversification under challenging market conditions,” he continued. “In particular, the Lion-OCBC Securities Hang Seng TECH ETF was announced as the Investment Product Innovation of the Year for Singapore at the annual Asian Banking and Finance Awards. Additionally, Lion Global Investors also won the Insurance Asia News award for Best ETF Manager.

“These awards are a testament to the success of the collaboration that combines the fund management expertise of Lion Global Investors and strategic focus of OCBC Securities in bringing global securities to customers. Not only does such a dynamic partnership deepen synergies within the OCBC Group, it also creates added value for our customers.”

Wilson describes the market and the economy as “like tides, with their own highs and lows.” For this reason, OCBC Securities is diligent in maintaining flexibility and adaptability during challenging times which, in the case of a global pandemic, has stood it in good stead when accommodating the changes to working conditions. “As we believe that people are our greatest asset at OCBC Securities, we focused on ensuring a proper infrastructure network to support our teams in their transition to a virtual working environment,” he elaborated.

“Whilst our team is adapting to new working arrangements, our customers’ needs are changing as well, thus we continued to innovate with new product offerings to match the fastmoving landscape. We also took the opportunity to digitalise our workflows and streamline our processes.”

Lastly, Wilson spoke on OCBC Securities’ approach to social responsibility and its support of the UN’s Sustainable Development Goals (SDGs). “OCBC Bank is focusing on six SDGs, including SDG 13 – climate action – which aligns with the OCBC Group’s material ESG commitment to sustainable financing, where banks play an important role in supporting low-carbon economy goals.”

“OCBC Securities also aims to support OCBC Group’s commitment towards lowering society’s carbon footprint.

Our new Lion-OCBC Securities Singapore Low Carbon ETF seeks to align investment portfolios with a low-carbon, sustainable future by tracking the performance of the iEdge-OCBC Singapore Low Carbon Select 50 Capped Index.

This index tracks the top 50 companies by Free Float Market Capitalisation that represent Singapore’s economy, focusing on decarbonisation.”

Wilson He Managing Director OCBC Securities

“ Moving forward, we are looking to upgrade iOCBC with Artificial Intelligence (AI) to provide personalised market content to help customers make more informed trading decisions. "

Pressures are mounting from regulations like the Corporate Sustainability Reporting Directive (CSRD) to meet the growing demand from investors and other stakeholders to provide high quality, transparent, reliable and comparable reporting on climate and other environmental, social and governance (ESG) matters.

However, there seems to be a growing confidence crisis amongst UK organisations. A 2022 ESG survey research by Workiva, has revealed that nearly two-thirds (63%) of senior decision makers in the UK feel their organisations are underprepared to meet their ESG goals and regulatory reporting mandates. Despite the current lack of confidence in tackling these reports, there are significant positives to getting ESG reporting right - such as attracting investment and better alignment with customers, and other stakeholders.

Perfecting ESG reporting will not happen overnight but there is no better time than now to begin this journey. As such, this article will discuss the existing steps businesses can take to improve their confidence in the ESG data they report.

The confidence crisis - how organisations can better tackle ESG reporting

Building the foundation for ESG reporting

Despite evidence that over half of UK organisations (59%) are addressing the issue, having appointed an ESGspecific role to oversee reporting, 73% still do not have confidence in the data being reported to stakeholders. This may simply be down to time, as organisations have not been required to produce ESG reports long enough to have real confidence in their processes.

The current goal is to have those in non-financial roles produce reports with the same rigour as financial controls in the next three years; however, this may be unrealistic considering that financial reporting took significantly longer than a few years to get right. In order for organisations to achieve this goal they must assemble a cross-function team. Bringing teams together from both financial and non-financial roles enables organsiations to produce the best, most collaborative assurance and board-ready reporting that is investor grade.

Meanwhile, among expectations that are concerning businesses are stakeholders who are calling for more detailed and uniform data related

to ESG. Despite progress needed across all facets of ESG, tackling the environmental or ‘E’ element is clearly the current major focus.

Included in this data gathered, reporters are expected to calculate greenhouse gas emissions and provide carbon accounting details which are currently the areas that decision-makers are most concerned about reporting on. In fact, for almost half (43%), these were cited as priority concerns.

While identifying the areas where major focus is needed is evidence that businesses are taking steps in the right direction, being prepared does not stop there. Organisations also need to understand existing and upcoming regulatory demands and determine how these will impact ESG strategy.

Keeping up with policies and standard initiatives

The lack of preparedness by decision makers can be strongly tied to the lack of clarity around the future ESG expectations that might lie ahead.

In efforts to improve this issue, government and industry regulators are currently rolling out a range of regulatory reporting requirements to

provide constant standards across the globe. These range from the recent Sustainable Finance Disclosure Regulation (SFDR) directive in Europe, to the ESG disclosure rule proposed by the SEC in the U.S. and the Singapore Exchange’s recommended 27 core ESG metrics. Meanwhile, the Task Force on Climate-Related Financial Disclosures (TCFD) has outlined the most effective principles for companies to analyse, understand and ultimately disclose climaterelated financial information.

Government regulators and internal policymakers are needed to communicate requirements clearly and work closely with reporting teams as well as their technology providers to ensure that these initiatives bring about the change they envision. Having the right controls in place ultimately makes processes more robust and repeatable, ensuring that the resulting metrics stand up to scrutiny. In particular this process applies to materiality assessments, which illustrate which ESG issues matter the most to an organisation’s stakeholders.

More regulatory requirements are still needed and these can come into place over time. As regulations, frameworks and stakeholders’ demands evolve, the key to maintaining confidence in reports will be to stay committed to regularly reassessing the processes organisations have in place. This will ensure they are equipped and ready to meet ever-evolving ESG standards.

Technology as the enabler to advance ESG reporting

Organisations are calling out for solutions to navigate the challenging ESG landscape. Meanwhile, financial reporting is in the middle of a digital revolution, focused on re-architecting and modernising systems. By taking lessons learned from finance and applying them to ESG reporting, businesses do not need to reinvent the wheel. Moreover, there are

existing solutions that account for both financial and ESG reporting, which should encourage collaboration between the teams. The key outcome is to ultimately produce decisionuseful data.

Desirable solutions should unite teams and workflows, and simplify the process of gathering data from across the organisation. Survey respondents also see these as being important for validating data for accuracy (80%) and mapping disclosures to regulations and framework standards (85%).

For example, automation is critical to ensuring consistently accurate results. Where data is input manually, the risk of calculation error is significant. Automating processes has been proven to remove additional steps that offer an invitation for human error. Where uniformity is needed across different reports and where data input is usually a repetitive task, automation offers a time efficient solution.

Similarly, through real-time collaboration, financial and nonfinancial reporters can ensure that when a data point is updated in one place, it is updated in every relevant analysis and report. Since data needs to be consistently merged in real-time to produce fully transparent, trustworthy ESG sustainability reports which can easily be integrated with financial data, there really is zero margin for error. Uniform, accurate reporting can be produced most effectively when combined with a platform that centralises related teams and integrates the full reporting process.

Taking the steps to prepare as much as possible

To navigate this era of change in ESG, organisations must be forwardlooking and flexible in their planning. Regulators, investors, customers, and

other stakeholders have identified what’s essential in today’s reporting, but this is only part of what will be essential for tomorrow.

Looking ahead, organisations are planning to dedicate more resources to improving their ESG reporting, with the ‘E’ becoming more of a priority. This renewed focus will ultimately help drive tangible change to improve the business impact on the environment and society at large.

Technology which enables seamless integration between teams in one centralised platform will be key to streamlining the reporting process in the long term. This will also support in delivering transparent reports that are critical to meeting evolving demands as well as attracting investors and wider stakeholders. Ultimately, smart preparatory efforts that take advantage of innovation will enable organisations to feel more confident in their current reporting now and when facing future ESG mandates.

Mandi McReynolds Global Head of ESG Workiva

Advancing on a Cloud: Driving Digital Transformation in Financial Crime

As CEO of NICE Actimize, Craig Costigan has continued to steer the leading provider of financial crime solutions by expanding into new markets, addressing the growing demand for cloud-focused solutions, and forging innovation across the full scope of antimoney laundering, enterprise fraud, holistic surveillance, and case management.

In driving innovation, Costigan’s teams of cloud developers, artificial intelligence experts and data scientists launched many new solutions this year, including advanced sanctions screening, dark web intelligence, entity risk solutions, conduct surveillance, and new account fraud offerings. Further integrating his recent acquisitions into the NICE Actimize family, he also led the continued success of two financial crime platforms, X-Sight and Xceed, explicitly addressing the challenges of top-tier traditional banks and mid-tier financial institutions, along with a focus on neobanks, crypto firms and more.

Craig Costigan CEO NICE Actimize

explained Costigan when he spoke with Wanda Rich, editor of Global Banking & Finance Review.

His and NICE Actimize’s success in customer satisfaction and technology innovation this year has been mirrored industry wide. NICE Actimize regularly earns top leadership rankings from the industry's analyst firms for its solutions, while global media also award NICE Actimize's innovation, citing advancements in wealth management, conduct surveillance, enterprise fraud and anti-money laundering across the Americas, EMEA and the Asia Pacific region.

“Our success has always been tied to placing the customer in the centre of all we do, and this accomplishment has been no exception,”

With all these successes, what does Costigan consider his most significant? Leading a strong, can-do, customer-first culture has been his greatest source of pride. As the executive explained:

“Without a strong commitment to our employees, we could never provide the service level required to lead our customers through the challenges of our changing workplace. We have expanded across our offices located around the world, and successfully established a committed workfrom-home environment. I couldn’t be prouder of the successes that our organisation has achieved on behalf of our customers based in more than 70 countries.”

What does Costigan have planned for the future? His answer focused on advancements in the cloud. He noted:

"Cloud is no longer nice to have; it is a must. We have seen a considerable uptick in the demand for cloud across all application areas and sizes of financial institutions. We expect cloud to continue its accelerated growth for the next three or four years."

Costigan remains responsible for NICE Actimize’s market strategy and vision, leading all sales, product, R&D, international services, and marketing. He is passionate about new growth, creating value, and developing innovative solutions for NICE Actimize clients worldwide while helping them address their most critical challenges.

Before joining NICE Actimize, Costigan worked at FIS as President of Capital Markets & Credit (CMC), a $1.1 billion segment, where he managed a team of 4,000 (est.) staff worldwide, overseeing risk, compliance, credit, security finance, securities processing, and market data solutions and services for over 2,000 banks, broker-dealers, investment firms, hedge funds, insurance companies and clients in the financial market. Before FIS, Costigan served as President of the Risk, Compliance and Global Securities (RCGS) Business at SunGard. RCGS was a $650 million global business with over 2,000 staff that provided front, middle, and back-office solutions and services to large and mid-tier banks and broker-dealers globally. As a former executive at FIS and SunGard, Costigan brings senior leadership and expertise to NICE and helps the company provide superior solutions and services to its clients globally.

How AI-powered conversation intelligence transforms CX for financial services companies

As was the case for many industries, the pandemic accelerated the need for financial services companies to rethink their approach to customer service and support. Live phone support remains the go-to channel for critical and high-value customer interactions, and businesses are therefore looking to harness nextgeneration technologies like AI and natural language processing (NLP) to deliver a superior customer experience.

Here are three ways that AI-powered conversation intelligence can transform the customer experience.

Increase customer satisfaction using an empathetic approach

Conversation intelligence provides context around the “why” and “how” to improve critical metrics like CSAT and NPS. It provides a deeper understanding of the customer journey from end-toend, providing opportunities for companies to proactively address real customer needs and provide a more personalized customer experience.

As counterintuitive as it may sound, AI can actually promote greater empathy and a more human touch to agentcustomer interactions. It allows agents to zero in on how the customer is feeling using tonality-based sentiment analysis, and dig deeper into what is making the experience positive or negative. It also enables supervisors to validate whether their teams are using effective empathy statements to connect with customers, and discover why certain calls are being escalated so they can better train their team on de-escalation tactics.

Improve conversion and retention rates

The average financial services company is only able to monitor 0.05% of contact center calls using traditional manual methods. AI, however, empowers them to automatically transcribe and analyze 100% of customer interactions, and take immediate action on a range of insights to increase conversion and retention.

Using this kind of conversation intelligence, companies can better understand exactly where customers churn, which type of dialogue creates the most positive experience, and what specific factors impact agent effectiveness. For example, AI can identify opportunities for the agent to quickly identify negative customer sentiment and provide recommendations for course-correction. This rapid and specific feedback also provides personalized coaching opportunities for agents that motivate them to improve their performance.

Give customers what they need — and what they want

Last but certainly not least, conversation intelligence allows companies to make smarter, datadriven decisions across the entire organization that include, but are not limited to, better support and service.

The insights gleaned from customer interactions can help marketing teams deliver more targeted, relevant campaigns based on customer response and feedback to new offerings. It also uncovers major pain points and unmet needs for the

product team to ideate around and address. It further provides sales teams with the insights they need to close more business. In short, every customer interaction becomes an opportunity to delight customers and keep them coming back while also uncovering business-improving insights that impact every function of the company.

Empowering human workers with AI

Financial services companies can hone their competitive edge by addressing customer support proactively, increasing customer satisfaction and retention, and creating products and services that continue to set the bar. AI-powered conversation intelligence empowers companies to augment the work of human agents to create a memorable, empathetic, and impactful customer experience.

Rich Wang VP, Customer Success Observe.AI

Credicorp Capital Colombia's Managing Director on Social Responsibility and Supporting Customers Through Turbulent Times

Credicorp Capital is a financial company that provides asset management, banking, investment strategies and advisory services. It serves customers in Chile, Colombia, Peru, the USA and Panama. Wanda Rich, editor of Global Banking & Finance Review, recently interviewed Ana María Giraldo, Managing Director of Corporate Finance for Credicorp Capital Colombia, and they first discussed the company’s role in financing the first social infrastructure in Colombia under the Public-Private Partnership (PPP) scheme, through the availability of COP 260,000 million.

“Credicorp Capital acted as financial advisor of Grupo Ortiz, to participate in the public process to award the concession and later the obtention of the financial closure of the project,” Ana María said. “Hospital de Bosa represents the first social infrastructure project awarded under a Public-Private-Partnership (PPP) structure in Colombia, which is evidence of the importance of this contract mechanism to boost the development of this kind of infrastructure in the country.

“The project had to overcome several challenges, the Bogota's District Health Secretary was needed to interact with the concession contract, and the risk assignments of the project. Fortunately, the project had a well-structured framework and a sound payment source that caught the attention of lenders and allowed the structuring of the financing.”

Credicorp has executed numerous complex transactions over the years which, as Ana María explained, were made possible by the expertise of the advisory team. “Our Corporate Finance team, which supports the transactions in which we are involved, is composed of a group of around 60 professionals based in Colombia, Peru and Chile, with extensive experience to advise our clients in all the products we offer: M&A, capital markets, loans and project finance,” she said. “To successfully manage complex deals we offer our clients a complete and close advisory, supported by deep knowledge of the markets and products, and oriented through methodologies and well-defined processes. Our deal-oriented team is in charge of all the financial structuring and coordinating of the different parties involved in the transaction.”

Recent years have brought on innumerable obstacles to be overcome, and minimising operational risk in that period has been paramount to Credicorp Capital. “The challenges faced by the global economy in the last years have changed the way the labour market acts and exposed new risks, but also big opportunities,” Ana María explained. “The adoption of technologies to support operations, and the adaptations to new work alternatives such as telecommuting, have been very important for Credicorp Capital during this time to manage operational risk.”

As far as social economic development is concerned, she is clear about the role the finance sector has to play. “Financial institutions must be conscious of their big impact on the social development of the economy,” she said. “The financial sector has been crucial in supporting the development of projects with a big impact in terms of the construction of infrastructure, energy transition, financing of social projects, among other aspects. Every day sustainable finance gains more strength, and through the promotions of these kinds of initiatives our sector is contributing to the social development of our countries.”

Ana María concluded by outlining Credicorp Capital’s plans for the next year. “We are prepared to support our clients to navigate through turbulent times due to a complex global economic context and political changes. Our value offer is oriented to identify investment opportunities and analyse, structure and execute those opportunities. In corporate finance particularly, we expect to find opportunities in sectors such as agriculture, infrastructure and energy.”

Ana María Giraldo Managing Director of Corporate Finance Credicorp Capital Colombia

How to survive an economic downturn: a beauty industry veteran’s hard-earned tips

There’s more trouble on the horizon as businesses grapple with ongoing economic uncertainty, characterised by dampened consumer spending , supply chain disruptions, soaring operating costs and crippling labour shortages . The IMF’s ominous warning that ‘the world may soon be teetering on the edge of a global recession’ has all but confirmed the situation on the ground. This is alarming news by any measure, but resilient businesses know a thing or two about buckling down when times get tough, and none are more well placed to plough through a downturn than seasoned players in the beauty industry.

Don’t be fooled, the beauty industry is more than just skin-deep. And there’s a lot to be said for businesses that can thrive in one of the most competitive and saturated environments during normal times let alone disruptive periods like this. After the fallout of COVID, businesses are increasingly wising up to the fact that changes can crop up hard and fast, and there’s no longer a baseline for ‘business as usual’.

Brands that have the most longevity in the beauty space have pivoted from challenge to challenge. They’re adaptive too – beauty businesses were amongst the first to embrace social media newcomers TikTok, and are keen adopters of digital technology and ecommerce . Additionally, the beauty industry is incredibly high tech with massive research and development departments, sophisticated manufacturing processes and innovative marketing practices.

So what secrets can a long-standing beauty retailer reveal about running a business that lasts, especially when the economic outlook is trending downwards?

Businesses must make every dollar count to stay recession-proof

Beauty businesses know that when budgets are lean (as they often are), every dollar must count towards a tangible outcome. Organisations might think they’re already doing everything they can to account for every dollar spent, but unless they periodically go over all expenditures with a finetoothed comb, they’re potentially overlooking budget-draining charges. From marketing campaigns with unclear and unmeasurable objectives to too much unused office space costing the business in rent, there’s always something that can be cut back on.

As a general rule, businesses should always have enough cash on hand to stay in operation for at least three to six months. Running a barebones operation is great for finding out what’s really contributing to the business and what’s not. Trimming the fat on non-essentials will also help build a buffer to insulate the business which in the event of a downturn will help offset unexpected costs. Cash flow is king, and those who can’t balance their numbers will struggle when sales start to dry up – this is particularly true of those who overly rely on past sales to predict their future performance.

With the ongoing surge in shipping and packaging prices, as well as consistent demand for commodities and raw materials, it’s wise to stay in touch with suppliers and manufacturers to keep on top of new developments. Talk with your suppliers on how you can address cost blowouts and address supply chain pain. They are best positioned to advise in the state if the markets.This is important

as businesses want to avoid being caught unawares when there’s a shortage or price hike in the works.

Nurture core customers and invest in hero products to stay afloat

Customer loyalty and goodwill is paramount for businesses caught in the midst of a recession, though this can only be retained if the business fulfills its promise of value and consistency. In a downturn, customers must justify every purchase and tend to spend on what’s familiar and reliable. Businesses need to go back to the very basics and put their best performing products on customers’ radars. They also need to invest more into improving these products or at the very least, keep them consistent to demonstrate their value to the customer.

Lego is a great example in demonstrating the power of simplicity and consistency. The company reached an all-time high in profitability during the 2008 recession due to its strategy of sticking to its core product while maintaining the product’s high quality. During the downturn parents wanted to purchase a traditional toy that would outlast its cheaper plastic counterparts. When Lego expanded globally during the GFC, it reaped the rewards for the versatility and quality of its toys, boosting its profits by two-thirds.

As well as investing more in core products, businesses must consolidate existing client bases to ensure their repeat patronage. Research shows that customer retention is a much easier game than customer acquisition. It is estimated to be 6-7 times more expensive to obtain a new customer than it is to hold onto an existing one. A slight 5% increase in customer retention however, can increase revenue by 25-95%.

To survive brands must hold onto their authenticity

In a recession panicking businesses would be mistaken to slash the prices of their products and services to increase sales. Though it may be tempting, the key question to ask is if a discount aligns with the brand’s values. Purpose-driven companies are proven to grow three times faster and gain higher market share than competitors. Having a strong vision of what the brand stands for and why it exists is the organising principle that drives a business forward.

Neither do purpose-driven organisations permit themselves to be easily swayed by others when it comes to matters of strategy and direction. It's the reason why the likes of Chanel and Apple never go on sale and it’s also the reason why long-lived businesses are able to bring in new custumers while keeping their existing base loyal. A business with confidence and conviction wins the support of its stakeholders and enables its own success.

Beyond authenticity and reason for being, there’s the matter of organisational mindset. The philosophy that propels a business best during economic downturns is one that is agile and adaptable. Start-ups like Groupon, Uber, Airbnb, and Square were all founded during a recession. Each organisation had a compelling purpose on top of an executive body that held onto its start-up mentality long after the business became established. This positioned them excellently to overcome future challenges.

As undesirable as they are, downturns are not only a natural part of the economic cycle, they also give the unexpected gift of illuminating a business’ strengths and weaknesses. For those invested in the long game, a recession is an inevitable part of doing business. It’s important that businesses keep a sense of perspective and not allow short-term setbacks to derail them from their goals. With the right contingency plans in place, businesses will not only weather the recession but potentially gain a strategic position of strength as well.

Rohan Widdison Founder & CEO New Labs

A part-time, online programme designed for those working in the financial and regulatory sectors.

Multiple qualification levels available.

Find out more: wbs.ac.uk/go/bankingW

Global Central Banking and Financial Regulation

Delivered in collaboration with the Bank of England

FirstBank CEO on Digitisation, Customer Relations and the Impact of Effective CSR Initiatives

First Bank of Nigeria Limited is a multinational bank and financial services company based in Lagos, Nigeria. It boasts an extraordinary 128-year history and is the region’s foremost financial inclusion services provider, having won multiple Global Banking & Finance Awards including ‘Best CSR Bank Western Africa’ and ‘Best Corporate Bank Western Africa’ this year.

Wanda Rich, editor of Global Banking & Finance Review, recently interviewed CEO and Managing Director of First Bank of Nigeria, Dr Adesola Adeduntan, to find out more about how a bank of such esteem and awardwinning success maintains its position as a pacesetting powerhouse.

Wanda initially asked his opinion on the most prominent challenges facing the African banking industry today. “They include, but are not limited to, inadequate banking infrastructure, shallow financial depth and low banking penetration, low financial literacy levels amongst the citizenry, prevalence of cash-based transactions, prevalence of illiquid, short-dated and costly domestic fund markets, and an onerous regulatory environment,” he replied. “It should however be noted that the severity or prevalence of each of these challenges varies from country/market to country/market. The more developed African banking markets like South Africa, Nigeria, Kenya and Morocco have less of these challenges.”

Part of FirstBank’s vision is to be Africa’s ‘Bank of First Choice,’ and it positions itself at the forefront of the growth and progress of the African banking industry. As Dr Adeduntan

explained, FirstBank is significantly driving the industry’s financial inclusion and banking penetration rate through its unique agent banking proposition in Nigeria, Ghana, Democratic Republic of Congo, Guinea, Senegal, Gambia and Sierra Leone. “As of August 2022, FirstBank has over 186,000 banking agents covering 772 out of the 774 local governments in Nigeria,” he reported.

has a robust portfolio of innovative digital channels that address the everyday banking transaction needs of both wholesale and retail customers,” Dr Adeduntan said. “This is evident in the commendable digital channels’ user base, transaction intensity and digital revenue. We have over 19 million users on the bank’s digital channels – the FirstMobile, FirstOnline and USSD platforms. Our customers completed more than 2.1 billion transactions worth over NGN39 trillion via digital banking channels in 2021. Our digital channel revenue grew by 15.8% between 2020 and 2021 to NGN56.8 billion, driven mainly by increased adoption and higher transaction intensity.

“In addition, FirstBank has been collaborating with regulators and key industry stakeholders to transform and improve the overall banking industry infrastructure in Nigeria and other African markets. FirstBank has also pioneered several innovative banking industry infrastructure initiatives in Nigeria. Our corporate responsibility and sustainability initiatives are deliberately aimed at improving the financial awareness and literacy levels of citizens in the markets and communities where the bank operates.”

Another area in which FirstBank strives to lead the way is leveraging digital channels to deliver improved services to its customers. “FirstBank

“Additionally, the bank’s digital channels have improved the customer experience and brand perception for the bank by extending and increasing customer access points to the bank’s suite of products and services.”

For clients looking to manage risk and enhance their revenue, FirstBank’s corporate banking division serves the bank’s largest clients in each of the main industries of the economy: energy (oil, gas and power), mining, services, conglomerates, manufacturing, telecommunications, infrastructure, agriculture and more. Dr Adeduntan explained that this division provides a broad range of banking and financial services which includes project finance, trade and corporate finance, term loans, foreign exchange and treasury services, cash management services, guarantees, collection and payment solutions, among others.

“The agent banking proposition is helping to improve access to financial services for the individuals and citizens at the base of the pyramid, as well as providing gainful employment in the localities where these agents operate, thus lowering the unemployment rate.

“The bank’s corporate banking division’s go-to-market strategy is anchored in its vision to be a ‘trusted advisor’ to clients,” he expounded. “Beyond deploying a robust balance sheet to meet the specific financing needs of the bank’s clients, the corporate banking division offers advisory services on various debt solutions and risk management strategies that help clients minimise their risks and optimise returns.”

He also reported an increase in demand for credit from corporates in line with the economic recovery of recent times. “Economic activities across Africa’s major economies have rebounded following the dip occasioned by the COVID-19 pandemic. In Nigeria, the economy exited the pandemic-induced recession in February 2021 and the same is the case for most other African countries. The increased level of economic activity has naturally spurred the demand for more credit to support the expansion initiatives of various corporate customers.”

He disclosed that in line with the general increase in the overall industry demand for credit from corporate customers, FirstBank’s

corporate banking division’s loan book grew by about 25% between June 2021 and June 2022. “Such robust growth is a testament to FirstBank’s strong commitment to supporting customer growth and profitability objectives.”

Discussion turned to product development, and Dr Adeduntan emphasised that FirstBank is deliberate and proactive in the development of tailored products to meet the everyday needs of its wholesale and retail customers.

“The specific factors that drive FirstBank’s product development process are anticipated changes in key customer segments, sectors, and industries; customers’ feedback; technological advancements; regulatory changes; outcomes of key stakeholder engagements; competitive trends in the industry; process improvement opportunities, and anticipated opportunities within the relevant ecosystem.”

As an institution with a rich legacy, FirstBank’s proactive approach to understanding customers’ needs and providing innovative products that meet them has allowed it to remain

stated. “FirstBank has developed key innovative products in response to corporate customers’ needs in the context of the current business and economic environment, including bespoke treasury products - FX swaps and non-deliverable forwards - and other structured trade and debt solutions. We have also deployed an innovative and robust transaction banking platform, FirstDirect. This platform has strong transaction banking capabilities in key areas including payments, collections and receivables, the B2B marketplace, liquidity management, supply chain finance and trade management.

“As a forward-thinking institution, the bank is also building strong data analytics capabilities that will provide valuable insights from both internal and industry sources to better serve our corporate customers.”

Making financial services as accessible as possible is a crucial component of modern banking. Dr Adeduntan outlined FirstBank’s array of financial services and products for both retail and wholesale customers that leverage innovative technologies to improve their access. “We are helping to deliver improved access to

financial services in three broad ways. First, expansive physical touchpoints. FirstBank remains at the forefront of improving financial penetration in Nigeria, with over 750 business offices and 186,000 agent locations across the country. The bank has been deliberate and strategic in improving access to financial services, and this has enabled us to record tremendous success, primarily through FirstMonie, the agent banking proposition. Today, FirstBank’s agent banking network is undisputedly the leading bank-led network in Nigeria. As stated earlier, the FirstMonie agent network operates in 772 of the 774 local government areas in Nigeria with over 186,000 agents, more than 50,000 of whom are female. Over 50% of FirstMonie’s agents are in rural areas, contributing significantly to providing financial services to people in remote locations who had been hitherto deprived of access to such services.

“Second is innovative digital channels,” he continued. “FirstBank remains one of the most innovative banks in Nigeria. This is evident in the various digital capabilities and touchpoints that the bank has deployed to improve access to financial services and products. The bank leverages technology to deliver exceptional digital touchpoints to both tech-savvy and non-tech-savvy individuals.

“With growing mobile phone and internet penetration in the African market, FirstBank deployed mobile platforms (FirstMobile, LIT app), USSD (*894#) and an online platform (FirstOnline) that allow customers easy and improved access to financial services. These platforms remain as leading digital touchpoints in Nigeria with over 19 million users. FirstBank has one of the highest numbers of ATM touchpoints in the country - over 3,000 - which allows customers to carry out transactions without visiting the banking hall.

“Third is our extensive financial service offering,” Dr Adeduntan went on. “FirstBank offers products and services that address the financial services

needs of all customer segments. The range of products and services offerings cover key business segments including corporate, commercial, SMEs and MSMEs, and individual segments including HNI, affluent, mid-affluent, mass affluent, and base of the pyramid/mass market.

“Specifically, for the unbanked and underserved individual segments, the bank has designed products and services to address their lending and deposit or transaction needs, including digital nano loans (FirstCredit), and no-frills savings and transaction accounts (FirstInstant).”

FirstBank has made great efforts to keep customer relations at the core of its banking operations. Dr Adeduntan discussed why this remains a priority and how the bank continues to strengthen these relations. “In line with FirstBank’s #YouFirst mantra, customers are at the heart of every business decision and action of the bank,” he revealed. “FirstBank remains one of the dominant banks in the African banking industry with a customer account base of over 38 million, and a balance sheet size of over NGN8.8 trillion. An excellent customer experience has been one of our competitive advantages.”

He elaborated on this point, underlining FirstBank’s appreciation of the importance of customers and the role they play. “Without customers, there is no business. At FirstBank, customer relationship management is not just about existing customers; it is also about potential customers. One of the bank’s core objectives is to drive customer acquisition and retention by strengthening existing relationships and establishing new ones through a positive customer experience. In this regard, FirstBank leverages innovative technologies to drive improved customer experience, patronage and retention. Any sustainable banking business must be built on a trust-based relationship. At FirstBank, integrity and respect for customer privacy and confidentiality are among the top priorities.”

Another high priority of FirstBank that he highlighted to Wanda was its commitment to supporting social economic development in Africa. “Financial institutions are expected to play significant roles in the pursuit of social economic development in Africa. In every economy, they are key in determining the efficiency and effectiveness of the resource allocation system. Through the financial intermediation role of mopping up savings from the surplus section of an economy and providing credit to the deficit section, financial institutions enable the overall economy to reach its optimal potential. They also provide individual and business customers with relevant financial products and services that drive overall economic development.”

In a similar vein, Corporate Responsibility and Sustainability (CR&S) is another area that has always been important to FirstBank, as he explained. “As a responsible corporate organisation, the bank has remained a dominant player, partnering and supporting various socio-economic development activities to promote the continued growth of our host communities, and Africa at large. FirstBank is committed to driving sustainable social, economic and environmental transformation. Our engagement in sustainable business practices is based on the bank’s commitment to economic development and stability for the present and future generations.”

In support of this commitment, he revealed, FirstBank has institutionalised several programmes to drive its CR&S agenda. “The bank’s flagship socio-economic development initiatives include the Community Infrastructure Development programme; Education Endowment; FutureFirst, the financial literacy, entrepreneurship and careers programme; our e-learning programme; the SPARK (Start Performing Acts of Random Kindness) programme, and the Environmental Preservation programme.”

He went on to describe the significant impact that has been made through some of these initiatives. “FirstBank partnered with IBM and Lagos State Government on the e-learning initiative to provide students with access to the Digital-Nation Africa (DNA) programme, an online youth-focused learning programme that enables innovation and skills development on emerging technologies. Over 170,000 students and pupils have benefitted from this initiative.

“The FutureFirst programme, in partnership with Junior Achievement, has imparted knowledge of financial literacy and entrepreneurship to over one million people across the country. The bank also partnered with the Nigeria Conservation Foundation on the Green Recovery Nigeria Initiative to raise awareness of environmental issues in Nigeria and encourage sustainable practices in over 30 schools across the country.

“In 2021, the SPARK initiative positively impacted over 80,000 people including widows, students and people living with disabilities. Over 60 primary and secondary schools have benefited from this initiative. The impact of SPARK has spread across at least seven countries where FirstBank has a presence, including Ghana, DRC, Guinea, Sierra Lone, Gambia, Senegal and Nigeria, with partnerships extending to over 100 charities and NGOs including LEAP Africa, International Women’s Society, UNGC, UN Women and Junior Achievement Nigeria.

“Finally, FirstBank has built over 15 social and educational infrastructure projects in universities and schools across Nigeria.”

Dr Adeduntan concluded with an update on what is coming next for FirstBank. “We remain focused on pursuing our vision: to be Africa’s ‘Bank of First Choice.’ The bank is driving the actualisation of this vision by exploring growth opportunities in new business areas and additional highimpact African markets, accelerating enterprise digital banking capability deployment, enhancing customer experience, delivering business efficiencies, consolidating leadership in transactional capabilities, strengthening technology and innovation capabilities, and building a stronger balance sheet.”

CEO and Managing Director First Bank of Nigeria

Dr Adesola Adeduntan

Three ways the insurance industry can use technology to stay ahead

Jay Chitnis, Senior Business Consultant at Endava, shows how the insurance industry can embrace the technology used by others to put customer experience first.

Insurance is a necessity, not a luxury. Whether it’s for our car, pet, home or holiday, it’s something we have to have — in some cases by law —

That’s not helped by the fact that the industry has stayed somewhat stagnant when it comes to meeting customer needs, compared to industries around it. Legacy technology is still the norm, meaning the customer experience is usually lagging behind when it comes to documentation processing, payments and claims. In order to remain current

1) Easier payments

The retail industry has pushed forward in improving payments and in particular, by embedding payment options right into the shopping experience. Giving people options like Buy-Now-Pay-Later (BNPL) and integrating services such as Apple and Google Pay has made it easy to complete a transaction without ever leaving the page or mobile app. Making this process easy and straightforward not only encourages customers to spend more easily with your brand, the simplicity also improves customer satisfaction, builds brand loyalty and encourages them to return.

If insurance took inspiration from this and embedded payments into their flow, it would not only make buying their insurance policies easier, but would also make for a quicker, smoother claims process. Getting the right solutions in place is key, so hiring a Head of Payments to handle implementation and management of payments could be an option for insurance businesses.

2) Go virtual

and for that reason, it’s an industry that doesn’t always have the best reputation or relationship with its customers. We feel obligated to buy cover, rather than a desire to have it, and it often feels like a one-way transaction — especially considering it’s something we usually hope we never have to use.

and to improve the relationship with its customers, the insurance industry needs to consider how deploying the right technology could help to revolutionise its processes.

The fact is, there are plenty of other industries out there offering the latest technology and features for insurance to take inspiration from which put the customer experience at the forefront. Here are just three ways in which the insurance industry could do the same:

While the full possibilities and potential of the metaverse remain to be seen, virtual and extended reality systems are creating huge opportunities across a range of industries. Whether you look to art galleries, offering people in-person experiences from the comfort of their homes, or estate agents offering virtual house tours during the pandemic — car companies have even been able to “build” a car in virtual reality, having engineers from all over the world working on designs for a prototype without ever leaving their homes.

VR technologies could simplify working process within insurance for both insurers and claimants. From the getgo, items could be assessed for value using virtual modelling as digital twins, and in the event of a claim, damage could be assessed virtually as well. This would be particularly useful in the event of a breakdown of expensive machinery in a hard-to-reach place. Rather than carrying out a physical inspection at great cost and risk delaying the claims process, an assessor could do it virtually, cutting down the time to claim. It would also mean that repairs could be planned virtually before contractors are engaged, shortening a potentially lengthy process.

3) Bring insurance to the customer

We have very quickly got used to getting everything we want in one seamless transaction, thanks to embedded experiences. Now, whenever we buy online we don’t expect to have to go to a list of different websites to book, pay, add extras and everything in between. That means when we are booking a holiday, we often prefer to use a site that allows us to book the flight, hotel and hire a car all in one.

This provides a smoother and more convenient customer experience. It also increases the likelihood of a customer adding extra services on top. By embedding insurance at the point of sale — right when you’re buying a car, phone or pet — it takes away the precarious step of leaving the customer to go and find it for themselves. Not to mention the richer data sets this provides to insurers, for deeper analysis into buying trends and claims down the line.

While the insurance industry has shown plenty of willing in taking technology trends on board and ensuring the right systems are in place, there is more it can do to truly get ahead. In order to change perceptions and make customer relationships that last, it needs to prove it is genuinely a customer-centric industry. Using technology like the examples above to put the customer experience first, will go a long way to ensuring it succeeds in getting ahead.

Jay Chitnis Senior Business Consultant Endava

Democratisation in Trading: Deriv Continues to Drive Accessibility

As one of the world’s largest online brokers, Deriv has grown its customer base to more than 2.5 million over the past 23 years. Deriv offers CFDs and other derivatives on forex, indices, cryptocurrencies, commodities and synthetics to its users around the world.

Its Head of Marketing & Global Partnerships, Derek Swift, joined the organisation 16 years ago as an Assistant Internal Auditor, and later took on roles in the Compliance team and Payment Solutions and Anti-Fraud department before filling his current position. Wanda Rich, editor of Global Banking & Finance Review, recently spoke to Derek who, by his own admission, had no knowledge of how foreign exchange worked when he first joined the organisation. “My experience with forex was limited to whenever I travelled for a holiday and needed to convert money to the local currency. Today, I head the Marketing and Global Partnerships department, and I believe I've been able to grow my domain knowledge for the same reason that Deriv has thrived over the past 23 years — a commitment to the goal of democratising trading. This motto of making trading accessible to anyone, anywhere, is what has distinguished us from the competition in the past and will be the foundation of our future strategies.”

Deriv’s aptitude in setting itself apart in the forex market is exactly what has led to its current market positioning, as Derek explains. “There are a couple of things that make us different. First, there are our proprietary synthetic indices, a market that's available to trade 24/7 and is unaffected by regular market hours, global events, and market and liquidity risks. Second, aside from offering a unique product, I would say we're also distinguished by our customer-centric approach, which allows us to tailor our products and services to our clients. Our trading infrastructure combines the best technology available with solutions for our most valuable assets — our clients and partners.”

It is no coincidence, therefore, that Deriv operates in a manner that is proactive in receiving and acting on client feedback. “Clients need a reliable and robust platform to trade, so we ensure our security standards are top notch for their peace of mind,” Derek said. “Business partners need the organisation they are partnering with to offer in-demand products and services that they can promote to increase their commissions, so we ensure we innovate in line with clients' suggestions and feedback. In fact, the new payment methods we keep adding are mainly due to the clients' suggestions.”

From the beginning, Derek explained, Deriv’s goal has been to build platforms that provide its clients with the best fintech solutions. “We currently have various in-house trading platforms and offer other top market platforms that are popular within traders' communities. For example, we have DBot, our own platform which clients outside of Europe can use to automate their trades, similar to MQ's expert advisors. The idea is to provide clients with a wide range of options so they can customise their Deriv trading experience.

“In the future, we plan to offer CFDs through social trading options, like copy trading, PAMM, and MAM accounts,” he continued. “Soon, we will also offer research and a signal centre for market insights. Innovation is crucial in fintech, so we are constantly growing and adapting to keep pace with the industry and stay ahead.”

Wanda also asked Derek for his thoughts on what trends investors should be paying attention to. Despite the recent crash of cryptocurrencies, he still believes that they are worth keeping track of in the long run. “All financial markets have their ups and downs, and cryptocurrencies seem to be no different,” he said, though he also stressed that the fear of missing out when following trends can often cause traders to wrongfoot themselves. “Not just those who trade without a plan - there are also instances where traders who have a long-term plan and a specific strategy jump onto the latest fad.”

Finally, Wanda asked Derek about Deriv’s plans for the near future and what innovations its customers can expect. “We are quite excited about the new trading instruments we plan to launch soon. It's still too early to talk about them, but I believe they will be well-received by our clients and partners, who drive the development of our products and services.”

How fintechs are shaping the future of finance

One of the world’s largest online API events - APIX - was recently organised and hosted by connectivity and integration expert, Sensedia. Run over three days, APIX attracted some of the world’s leading tech specialists and strategists, all keen to share their perspectives.

Here, Patricia Haynes - VP, tech ops and delivery, Zopa bank, Tadas Bakutis - CTO at banking services/ payment provider, Connect Pay, and Elliott Locke - co founder/CEO at expat wealth management platform, Abroaden, discuss how to build a sustainable partner ecosystem, how fintechs integrate services/enhance the user experience and what the financial sector will look like in 10 years time. Event Chair is Sesh Ram, Sales Director, Sensedia.

Building ecosystems

Sesh: Finance is undergoing a profound transformation and fintechs have played an increasing role in shaping the financial and banking landscapes. From what we have been experiencing, fintech ecosystems are improving democratic collaboration and technological advancement. So how can you build a sustainable partner ecosystem?

Collaboration

Patricia: The best place to start is with your own internal teams, ensuring you’re able to facilitate hybrid or remote collaboration. 15 years ago we wouldn’t have considered it possible

to complete the final stages of building and launching a bank without an onsite presence, but due to the challenges of the pandemic during 2020, this is exactly what we did.

Technologists have been working at least partly remotely, probably more than most industries, for a number of years already. So when we went into lockdown it was a smooth transition. We had access to communication and software development tools such as Slack, Github and Zoom etc - tools we were more used to than those outside a tech environment.

Adjustments however, still had to be made; one of my top priorities was to take what we had and

improve them and how we communicate. This involved everything from adding extra tools for engineers to be able to pair remotely, so it seemed they were sitting next to each other in the office, to improving the tech we sent to everyone's homes, enabling them to be as present as we needed them to be.

As the personal and working lives of colleagues and wider groups merged, tech allowed people to innovate at the kitchen table, outside their 9-5 boundaries, and give their best when they were at their best, instead of within a fixed time period.

Over communicate

The biggest thing we’ve had to learn is to make that extra effort and over communicate - particularly because there are other external/internal teams and dependencies. The chitchat that spawns information-sharing and learning by osmosis can almost disappear in a remote or hybrid situation so it’s important to nurture it.

Internally, this can mean making the most of forums, like Chapters. We have a ‘tech all hands’ forum which is invaluable in bringing in new ideas, sharing innovation across a wider audience and giving people the chance to put their hands up and ask for help to solve a challenge or problem.

In the past we may have asked colleagues in the office for feedback but now we can go onto forums and share our tech community’s learnings across our network of partnerships, creating a wider collaborative community. There are more opportunities to learn, build strong partnerships and have that tech conversation.

The finance landscape

Sesh: Having looked at how to support and build a tech community, most banks understand innovation is inevitable, and even larger banks appreciate the benefits of working with fintechs. So what will be the next key technologies/experiences shaping the competitive landscape of finance?

Component technology

Tadas: Banks are acutely aware of how innovative fintechs are and during my 20 years in the financial services sector, I’ve seen changes in how banks are starting to collaborate with fintechs, share their working spaces through innovation hubs/ communities and implement ideas from external sources.

In the future there will be greater demand, via collaboration and integration, for technology that can support the bigger financial institutions. As a small startup, we’re already working with eight partners which shows you don’t need to create everything on your own. Historically the larger banks ran everything, including the maintenance of their own systems, but in this new age of fintechs, separate companies and their component technology take responsibility for Anti-Money Laundering, personal identification etc.

APIs and security

Smaller fintechs focus on creating the functionality and scalability to support the user experience, and going forward, there’ll be more dependency on this. Technology that allows partners to scale up and grow together in real time and in a secure way - such as APIs - will be vital, particularly as the tech that used to exchange data between banks is now obsolete due to cloud computing.

Security is a key component of technology and must be included within a growth strategy; paying for everything today is seamless and at the centre of this is integrating tools to support the user experience.

Fintechs can propose ways to easily integrate services and share everything that’s needed to build a platform to support a b2b and b2c client base.

Wealth tech 2.0

Over the past 10 years the process expanded, similar to Open Banking, where new guidelines were drawn up for payments, account information and general finance services provision.

I call it wealth tech 2.0. Instead of coming to market, directly regulated, wealth techs and fintechs are providing additional services which deliver what retail investors want - an experience built for them through a trusted source of information. Trust is crucial as we’re asking people to make an investment and build a 20/30 year relationship that will help them save and meet their longterm financial goals.

User experience

Wealth management and fintechs

Sesh: With digital tools transforming the way people approach finance, wealth management is the next financial service that will be impacted by fintechs. We’re already noticing an emerging new generation of investors that expect a wealth management experience, so how do you see wealth management providers and fintechs working together to deliver the best experience?

Elliott: In the wealth tech and wealth management sector, technologies have developed in parallel. If you look at the history of wealth techs, trading apps and robo advisers came out in 2010and their common link was they were built directly as regulatory entities, so were brokerages, licensed by local market authorities.

We create trust by working through the user experience and language (we cannot understand our audience without the right language). And it’s the tech that enables us to plug into different verticals. At Abroaden, for example, we build on the stack of a regulated provider so we don’t have to spread resources and focus on compliance and regulation. We meet our obligations, but we don’t need a department to ensure we do this; instead we focus on how we build the user experience. We listen to our users, test our products and new features, work on marketing, look at what does and doesn’t work and really build the service. We focus on a specific niche - expats - and this target audience approach is common in the wealth tech sector.

API value

What’s really cool is the APIfication of the financial stack. For financial services and entrepreneurs it enables users to plug into any tool that may help their business. For example, in investing and money, psychology and how we interact with our finances and how they interact with us, is hugely important. To be able to plug an emotional intelligence trainer into your platform, through an API, transforms the service you’re able to deliver, adding value. And the great thing is you don’t have to be an expert in this vertical.

The ability to take raw data feeds from APIs and turn them into something useful, something clients really want, with the right design is fantastic. This is where the value lies and in the future more wealth techs will become niche. Wealth will be more impacted by APIs because this sector has to build long term relationships; banking is more transactional

Finance in 10 years

Sesh: What will finance look like in the next 10 years?

Patricia: It will be more customer centric - customers are more demanding now. Over the last 10 years apps have promoted the growth of fintechs and wealth techs, and this is an area where the larger financial institutions have lagged behind.

Tada: Innovation and change will cause turbulence in the sector, but in 10 years it will settle down and in 20/30 years times these market disruptors will be viewed as ‘the old fintechs’. The focus now is on improving the user experience, giving more value and making day to day activities easier, more seamless.

Elliott: If we believe in the statement ‘in the future every company will be a fintech’, it means embedded finance has won the fintech wars - if it is such a thing! In 10 years time, companies that are not fintechs will have more fintech tools, like Apple deciding to offer buy now, pay later. Those who win customer trust and excel in delivering the customer experience will be those who have carved out and own a niche. One size fits all will no longer exist; it’s either going to be part of a non-financial services stack or someone you really trust and need.

Sensedia

Sensedia helps companies become more digital, connected and open through its technology platform and expertise in APIs and Microservices. Whether integrating channels or creating ecosystems and modern multi-cloud/hybrid architectures, innovative enterprises rely on Sensedia as a partner in API management, Microservices, ServiceMesh and Open Banking, and for rapid legacy integration.

Sensedia is present in Brazil, the UK, Ireland, Peru, Colombia, Mexico, Germany, Spain, Switzerland and Lithuania. www.sensedia.com

Tadas Bakutis CTO Connect Pay

Elliot Locke Co founder/CEO Abroaden

Patricia Haynes VP, tech ops and delivery Zopa bank

Is ESG investing becoming the new norm?

An insight into ESG investing and what this means for the future of business

In this article, Director of Acumen Financial Planning, David Gow discusses his thoughts on ESG investments, the difficulties that can be encountered and whether it will become the new norm in the financial sector.

The current landscape

Rising in popularity across various industries, ESG has become a critical asset for companies to carry out, regardless of their size or portfolio. If carried out correctly, ESG strategies can affect operating profits by as much as 60% according to Perillon research and is widely viewed as one of the most sustainable ways to invest.

Becoming a global trend within the business world, ESG reporting mandates have grown in the last four years by 74% which to some may prove that it’s here to stay. However, despite 85% of asset managers citing it as a high priority, 64% flagged concern about a lack of transparency and corporate disclosure on firms' activities. 1

How to invest in ESG

There are various factors to take into account within ESG investments, including the complications around the criteria itself.

Companies or individuals can make an ESG investment based on the consideration of the environment, human well-being and the economy. This is demonstrated for example by Microsoft, as within the top 100 ESG companies to invest in, it is currently top of the list, not a surprise as they are a global brand. They have also committed to having zero waste and pledged in relation

to the UN Goals for people to have access to clean water whilst also securing own water supply, aiming to have achieved this by 2030 which could attract an even higher range of investors across the globe.

76% of consumers have stated they will no longer buy from companies who treat the environment, employees, or communities poorly. However, many believe the financial performance of a company is directly related to environmental and social factors, which isn’t necessarily always the case. 2

Companies can use their financial performance as a deciding factor to those interested in investing in their company but may not be as sustainable or environmentally friendly as they have advertised. This can confuse investors which may result in them investing in the profit rather than the environmental ethos that they were initially attracted to.

In my experience as a financial planner, I’ve found that ESG investments take a great deal of consideration. It is an emotional and ethical decision to make when investing in an ESG portfolio. For many, the decision is based upon the knowledge that your money is being invested for the greater good.

The difficulties and the complications

To be defined as an ESG company, there is a level of criteria that needs to be met to gain the status and this is something your financial planner can guide you through. It’s important to know that this may vary depending on who is setting it.

The person granting the definition may have varying opinions on what meets their ESG standard which could result in different ratings across the board. For example, one company may believe their commitment to the environment exceeds the standard, while another thinks that they are not doing enough which will result in different ESG scores.

Without overall governance, this area can be tricky and changeable, but a company’s ESG status can be monitored by various parties including prospective investors, employees or partners and members of the public. While ESG was once a niche practice, it has become almost a trend – with issues like greenwashing becoming more common. However, this is expected to significantly change, as it is predicted that more legislation is to come.

In January this year, two new UK laws were passed and took effect in April. These were the Companies (Strategic Report) (Climate-Related Financial Disclosure) Regulations 2022 and The Limited Liability partnerships (Climate-related Financial disclosure) regulations 2022. Under these laws, companies must provide their reports and include non-financial and sustainability information statements.

With one in ten publicly traded companies adopting ESG, it can be confusing where to invest. Over time the majority of companies will hold these practices, so it may no longer be a deal breaker for potential investors.

Many global investment management firms are now responding to growing interest from investors by rebranding existing funds and launching new funds that target specific

sustainability objectives. However, it’s good to be mindful as many organisations who have implemented ESG practices could also be trying to cover up poor business performance.

Whether ESG investing will become the norm

Compared to previous years, information and transparency are key when it comes to investors. Gone are the days when you could label your company as ESG practicing without having to provide evidence to support it. The prevalence of greenwashing has also demanded more valuable insights from investors into whether companies are following the correct processes, as well as an ongoing tightening of regulations.

Overall, it is evident that ESG investing will continue and become the norm. With the introduction of new laws and more in the pipeline, it will make

it simpler when it comes to choosing where to invest with the help of financial planners.

Notes

The content contained in this article represents the opinions of David Gow at Acumen Financial Planning. The commentary in this article in no way constitutes a solicitation of investment advice. It should not be relied upon in making investment decisions and is intended solely for the entertainment of the reader.

David Gow Director Acumen Financial Planning

How a customer centric approach can help banks support consumers with money worries

The global pandemic, inflation reaching record heights and the cost-of-living crisis are the perfect storm that has worsened financial situations for many across the globe. In the US, a quarter of Americans say they felt financially stressed all of the last year. And in the UK, threein-eight adults say they have seen their financial situation worsen since the pandemic, with 15% concerned that it has become significantly worse, according to the FCA.

Unfortunately, there is an undeniable link between money worries and mental health. The financial crunch is leading to a mental health crisis that is only starting to hit. Thankfully, it is a situation that isn’t being ignored. It can be argued that there has never been more awareness of the impact of money worries on a person’s wellbeing. This has to be a good thing. Society has a golden opportunity to radically change how it supports and helps people with money issues.

An opportunity to rebrand

Banks have inevitably been the ones thrust to the front line. The good news is that consumers have been embracing their position. Banks do see an opportunity to rebrand themselves not just as financial product providers but as financial care providers.

However, to do so effectively, offering support without judgement is crucial. A customer-centric approach will help banks provide support whilst minimising consumer confusion. This is especially important at such a stressful time. Undertaking such an approach can help foster goodwill and positively impact the bottom line.

Widespread financial confusion

How well a consumer can navigate changes to taxes and inflation can significantly impact what they’re able to put on the table for their family. However, it often baffles the average consumer. Just look at the widespread confusion brought upon by the Energy Bills Support Scheme earlier this year.

It is no surprise. Banking and taxation use a wealth of language that seems designed to confuse. So much so that a study in 2019 found a clear trend of declining financial literacy among young adults, with four in five failing a basic financial literacy test.

Raising financial literacy will help improve the economic outcomes of millions of people. It will lead to less unmanageable debt and less need for difficult conversations with loved ones. Knowledge is power and will put people back in control of their money. Addressing financial literacy and being more upfront with customers can be the perfect opportunity for banks to show that they care. They can pivot their brand to become a friendly financial care provider, not an enemy to the people trying to make money at every turn.

A shift of focus

Digital service is increasingly important and can make an enormous difference if built with empathy. However, it can only go so far and is most effective if paired with reallife human contact. Rationalising with another human being can help a concerned customer and tackle their problems head-on. Putting problems in perspective can also decrease worry.

Focus on training your customer experience front line. Supportive advisors can talk customers through detailed products, solutions, and support schemes whilst providing salient advice on what to prioritise. It requires a shift of focus – a move from debt management to financial care. In our experience, language is a big part of it, particularly in digital services.

Technology can be designed to recognise consumer concerns by analysing their language and tone of voice. These clever algorithms can be used to raise alarm bells. Similarly, using technology to find the right words can be instrumental in reassuring customers. A human voice and empathetic language will make the conversation authentic and genuine.

Additionally, technology can also be used to recognise problems before they occur. It can spot trends in data. For example, it can identify and flag customers running low on money and help refer them to the financial care team.

Fostering loyalty

To guarantee their future, financial service organisations need to view their customers are humans and build their approach around this. Support teams can deliver game-changing customer experiences and foster brand loyalty by focusing on long-term outcomes rather than short-term fixes.

Banks are financial experts, and consumers are not. Now is the time to take a more customer-centric approach to help consumers with money worries. Banks who can provide support and guidance will accelerate their success. However, investing in customer support teams will be crucial to do this effectively. Experience shows a clear connection between investing in customer experience colleagues and positively impacting customer wellbeing. It makes perfect sense. By covering and making sure to support their best interests, colleagues will feel more engaged with their work and add more value to the customers they serve.

Brandon Aitken Global Business Director | Financial Services Sector Webhelp

Winning customers – the five challenge areas for traditional and challenger banks

Mobile banking is now the norm. Over 90% of the British public reported using online banking services in 2022 – across traditional and digital-only banks. No surprise that digital wallets, mobile banking apps and personalised FinTech solutions are seeing high investment and growth.

Consumers expect a smooth experience that empowers them to control personal finance.

Challenger banks were quick to meet this need ¬– they now collectively hold 8% of the market share for current personal accounts. And are expanding into SME accounts.

There is a massive appetite for digitally enabled interactions. And banking providers are in a rush to get a piece of this pie. Traditional banks lag, encumbered by legacy IT from a pre-digital era. Yet they also hold some strong cards, such as a superior understanding of complex regulatory environments.

There are five areas of competition for traditional and challenger banks (aka neo banks). Understanding these is vital for both players’ ability to learn from each other so they can deliver the superior experiences customers desire.

The five areas of competition

Today’s customer expects to be centre stage. Best interest rates are no longer enough. Banks must delight customers across every interaction.

Superior customer experience

Challenger banks were born to compete on customer experience (CX) – they are leading the way on the digital front, and dropping voice channels for digital-only proved successful in the early days. Yet as customer profiles grow, challenger banks are expected to support voice and more traditional channels.

Meanwhile, established banks are catching up on digital and launching new brands and partnerships to compete. They hold the trump card of having well-established voice services, a channel that will remain a preference for some customers.

Holistic services

Achieving simple, intuitive digital CX across multiple product types is a significant challenge. Traditional banks have the product breadth but often clunky digital CX, such as siloed apps. Challenger banks offer a brilliant digital experience, but for a narrow offering.

Customers want both – an easy-to-use experience across multiple products. For challenger banks and FinTech, this is a strategic problem. Most focused on one area – brokerages, crypto, and Robo-advisors – now they must expand horizons to retain hard-earned customers who want more comprehensive services, especially in card and consumer lending products.

Traditional banks have been quick to respond to this need for holistic services. Some have acquired new platforms, such as Morgan Stanley’s purchase of E*TRADE. Others have gone the partnership route to growing portfolios – the Goldman Sachs and Apple joint card launch being a prime example. Expansions have helped traditional banks stay ahead – but with challenger banks focussing on expanding their offer, the gap is closing.

Continual technological innovation

ABCD technologies – Artificial Intelligence (AI), Blockchain, Cloud and Data – offer immense innovation opportunities for financial services. Neo banks and FinTech, unburdened by legacy IT, have quickly incorporated these into solution development.

Incumbents sitting on layers of legacy IT were initially slower to introduce new tech. Now adoption is speeding up. Some are partnering with smaller FinTech to improve offerings, while others are starting to run AI and machine learning on data sets. And more are shifting parts of services to secure cloud. One thing is clear, the application of ABCD technologies is here to stay.

Robust security and compliance

Governing bodies and customers expect high security from banking providers. Here, the age and pedigree of traditional banks serve them. Decades of working with regulations help quick adoption of new governance requirements. While thoroughly tested processes can better withstand scaling.

In contrast, many challenger banks had built solutions with somewhat lax regulations, primarily focussing on CX. As regulators across countries begin to clamp down on flexible regulation practices, neo banks, to ensure survival, must act quickly to attain the levels of compliance implemented by traditional banks. Neo banks have challenging times ahead, balancing technology-driven services with more compliant services and a heightened focus on financial crime.

Navigate market expansion

By 2030 embedded finance – personalised and contextual financial services – is set to outgrow financial institutions by 20% . This leaves much space for both neo banks and incumbents to expand, and both must look to adapt their business models.

What both traditional and neo banks can learn from each other

As conventional and neo banks compete by expanding offers, optimising contact channels and utilising new technologies, there is plenty they can learn from each other. And from their past experiences. Below we explore where the learnings lie and some key takeaways.

Evolving customer support

Pre-pandemic, online services offered by traditional banks lacked compared to their neo counterparts as they relied more on in-person interaction at physical locations. The pandemic helped banks speed up digital transformation, advancing and improving their online services with 24/7 support to meet customer expectations.

The lesson for traditional banks is explicit –while digital transformation projects face various challenges , they don’t need to take multiple years. And agility is key to evolving customer support.

Another learning for traditional banks is tied to digital channels. As older generations gradually join younger users in switching to online services, traditional banks are evolving their customer support. Emulating challengers’ use of AI chatbots and in-app chat is an excellent place to start. Because thanks to the proliferation of challenger banks, many users are accustomed to these channels already.

Tech-enabled experience

Significant learnings for both sides come from AI-enabled conversations. Retail banks are joining challengers to provide personalised experiences through better use of data. Both run AI on historical datasets to spot patterns that predict customer needs and intentions.

Beyond improving interactions, AI insights can support agents in cross and up-selling by bringing up relevant prompts. Giving agents the confidence to answer customer requests with increased speed and accuracy improves their confidence and minimises customer annoyance. As a result, the customer service role is much more fulfilling and enjoyable.

Yet we are still just scratching the surface of AIenabled interactions. The following steps will use AI insights to drive customer interaction tactics that build lasting relationships.

Future-proofing customer support

Customer support systems are constantly evolving. The future direction is set to include asynchronous channels like WhatsApp.

Asynchronous chat lets customers pick up and set down conversations at their convenience. Customers drive the pace. Conversations start and pause based on customer, rather than agent, availability.

Fluid, asynchronous interactions provide many learning opportunities and CX possibilities. As customers move between channels with ease—from messaging to voice, to the web, to chat and back to messaging — banking providers need to be ready to adjust their contact strategy. The challenge for providers is to ensure they can reduce frustrations and improve the experience across all channels and conversations, making it one seamless experience.

Collaborating in the new era of CX

Perhaps the most critical learnings –for both sides – come from strategic alliances. Collaboration between challenger and traditional banks has begun. Goldman Sachs recently partnered with Barclays, while Stripe is partnering with Citigroup. It is a step in the right direction, but to succeed both parties must be willing to work together to complement their areas of expertise.

A new era for customer support

Most customers say the quality of online experience determines whom they bank with, so investing in customer service systems and tools is key to remaining competitive.

One learning is evident regardless of how you view the competition: CX must remain on the banking providers’ agendas. Great CX attracts and retains users whereas a bad service will repel even the most loyal customers.

Traditional and challenger banks must be willing to adjust processes, visions, IT systems, and offers to deliver the holistic, responsive and fluid experience that users seek. Because in the end, the winner can only be the customer.

Venugopala Dumpala Practice Head Banking & Financial Services Firstsource

A road map for capitalizing on a growing HNWI market

Recent rapid growth in the UK’s highnet-worth individual (HNWI) market is colliding with a series of economic challenges—war, high inflation and unsteady markets among them—to create opportunities for banks and wealth management firms that can meet evolving client expectations.

In 2021, the number of HNWI individuals in the UK grew 6.3%, to 609,400 according to Capgemini’s 2022 World Wealth Report . The financial wealth held by those people rose 7.4%, to $2.27 trillion.

Recent market turmoil has heightened client sensitivity to the value of wealth management services. It’s a fiercely competitive market, and the terms of engagement are evolving. The winners will be those firms that target growth segments with the skills and capabilities to deliver superior client experiences and build emotional connections.

What HNWI clients want

HNWI clients expect a lot from their wealth managers. They want personalised offerings, innovative products and services—including investment alternatives in emerging asset classes such as ESG, cryptocurrencies and nonfungible tokens (NFTs)—as well as real-time advice and recommendations that can anticipate their needs and help achieve their unique aspirations.

They’d like those features delivered digitally, in the same seamless, transparent manner they get from Amazon or Uber. While handholding can be important, these clients are comfortable—and often prefer—using

self-directed digital tools to manage their portfolios. They also want wealth managers to help orchestrate their unique digital ecosystem journeys, in real-time.

FinTech firms, built for the digital world, are made for this moment. For incumbent banks and wealth management firms that excel at oldstyle relationship management, the model looks only vaguely familiar.

While the industry has long revolved around helping clients achieve their goals and meeting lifestyle needs, creating the level of personalisation needed to compete in today’s digital world is more about leveraging technology and data-driven insights than face-to-face interactions.

Adapting to these new expectations can be a challenge. To position themselves for success, banks and wealth management firms can target high-growth segments and embrace the data-driven business models, delivery technologies and talent needed to provide differentiated experiences and meet client expectations.

Target emerging growth segments

Much of the growth in the HNWI market is coming from a handful of market segments, yet only 27% of wealth management firms in our survey said they actively pursue such groups with targeted engagement strategies.

One of these emerging client segments is Tech wealth, following the surge in venture capital-backed unicorns which has created a fast-growing group of ultra-HNWI's whose clients flush with IPO cash. Tech-savvy HNWI’s

demand support in active investing, personalisation and consolidated services from wealth management providers. In fact, a majority prefer family offices over large banks or wealth management firms.

Beyond this, women are becoming one of the fastest growing client segments, with the demographic set to inherit 70% of the world’s wealth over the next two generations. However, they are less confident than men in their ability to generate and grow it. These consumers value purpose, connections and content tailored to their needs. Ellevest, a FinTech firm founded by women with an investment algorithm that considers gender, has grown quickly by focusing on that demographic.

Similarly, millennials are on the receiving end of a massive generational transfer of wealth and want more digital engagement – but many also need help with the basics. In Hong Kong, HSBC ’s “Wealth Coach” and “Wealth Bootcamp” offerings are examples of leveraging education to help capture more millennial clients.

A relatively new client segment that has emerged, LGBTQ+ individuals are often faced with legal and financial system complexities during pivotal life events. Such clients value an inclusive approach—from investments to legacy planning. Thirty percent of global wealth managers in our survey said they did not understand LGBTQ+ clients’ needs, showing that the industry still requires educating in how it can best meet the needs of emergent consumer groups.

Gareth Wilson Head of Banking and Capital Markets UK Capgemini

Finally, the mass affluent are leveraging new technologies and delivering superior experiences to win clients early on in their journey to greater wealth. JPMorgan Chase’s 2021 acquisition of Nutmeg, a British robo-advisor focused on the segment, is considered critical to the New York bank’s UK retail strategy and demonstrates this is a proven pathway to growth.

Getting from here to there Succeeding in this environment means meshing a combination of personalised products, capabilities and services that can differentiate a firm in the eyes of clients – and it starts with leveraging major data sources like FinTechs.

Incumbent banks have lots of data but often are not good at turning it into insights that can personalise engagements and drive growth. Investing in technologies like artificial intelligence and machine learning (AI/

ML) algorithms that can deliver actionable insights in real-time can put a firm on solid competitive footing.

Likewise, HNWI clients expect to access their portfolios and other services digitally and in real-time, 24/7 and from any device. As such, it’s important for firms to embrace new delivery technologies to ensure that the client experience is consistent across channels.

In many cases, the quickest and most-cost efficient way to offer new digital products, services and delivery options is by partnering with or acquiring a FinTech that has already developed it. So many capabilities are needed, it is all-but impossible to build them entirely yourself, and so collaborating with your rivals may actually reap many rewards.

The next step is to look at your talent and where skills can be learned or upgraded. New ways of doing business can require hiring people with data, technology and product skills. It also helps to have talent that reflects the diversity of the markets

you’re targeting and understands what those clients want. It can be easier to win LGBTQ+ clients if you have employees who understand key sector expectations. Following this, it can be useful to name a chief client officer within the firm, as many organisations feel this is a time-effective way of rising to the enhanced expectations of emerging consumer groups.

Finally, the key driver behind many of these emerging segments’ needs and preferences, is the desire for greater transparency. In our global survey, 27% of HNWI clients were unhappy with the fees they were charged, primarily because of poor transparency around pricing. Sixtyfour percent said they preferred fees based on metrics such as investment performance or service quality.

As clients warily eye an evolving economic landscape, banks and wealth management firms can build stronger emotional connections. Firms that can best guide clients through uncertain times with personalized experiences that inspire confidence will be positioned to build deeper, longer-lasting relationships.

Digital transformation with an API-First approach in finance

Digital transformation impacts businesses in many industries and drives technological advancements to maximise efficiency beyond what we thought was possible even five years ago. Furthermore, digital transformation in finance is accelerating, driving improvements in business processes and customer experiences, aligning them with evolving markets and businesses.

Behind the success of all this is the application programming interface (API), relaying information from one organisation's pre-existing technology to another. APIs connect to different areas of a software platform, allowing for more information to be accessed when businesses undergo their digital transformation journeys.

Embracing digital transformation in finance

‘API-First’ is an approach that can help organisations future-proof their development and API strategies in order to adapt to the new rules of the digital market.

Digital businesses, especially banks and financial services could potentially have a head start in adapting to this way of working. Once they have leveraged the wealth of data, information, customer experience

and knowledge, they need to adopt an omnichannel strategy to keep up with digital transformation in the wider external ecosystem. This approach will create an environment and culture that delivers both innovation and digital leadership while allowing banks to evolve in line with future demands.

The solution to technical challenges

When talking about technical topics such as APIs, API Management, API Security, Event-driven architecture (EDA) and APIs, it can be easy to talk about value only as it pertains to technical value. However, APIs are able to deliver serious business value as well, and finance organisations that have taken an API-first approach have realised this.

Technical teams have long understood the value of APIs. These teams typically know that APIs can be used to expose financial services as productized APIs, which can enable partner and customer onboarding and avoid duplication in each system interface. They can also prevent database duplication, strengthen security and reduce vulnerability and automate workflows to improve efficiency.

With more than 20 years of innovation, technological development, and a customer-first culture, Deriv remains committed to its goal of making trading accessible to anyone, anywhere. Today, Deriv operates from 13 countries and serves over 2.5 million loyal customers worldwide, providing them with the best experience possible.

However, decisions to support these technical teams in a building and make APIs available for these purposes are also business and strategy decisions. And, as a result, proper API-first implementation will require business users and stakeholders to more fully understand APIs and their value and understand how API usage can be driven from the ‘business side.

Why API-First?

API-First is an organisationwide approach that treats APIs as ‘first-class citizens.’ This means that development and business strategies are mapped out with APIs in mind, and, specifically, with API consumption top of mind.

While APIs can be leveraged for many different benefits, there are some major ways that APIs function across leading financial organisations, these include creating a contract that defines who has access to data and services and being an efficiency multiplier. This means reducing the risk of IT components, digital services and datasets needing to be created within each interface or system (for example, by reducing redundancy or by creating duplicate databases in each business unit when designing data flows across multiple departments).

Additionally, providing an ecosystem builder allows key partners, third parties, and consumers to cocreate new products and services built off core business systems is crucial. By behaving as a digital enabler, the delivery of new features, products, services and workflows is improved, and working as a data

infrastructure element allows for better collection of timely data on usage, performance, and demand to provide business insights.

API as data infrastructure also allows finance businesses to plug into artificial intelligence tools and privacy-enhancing technologies to support an organisation’s maturity as it moves beyond being a digital organisation, to being a dataenabled organisation.

Achieving business excellence

Embracing digital transformation and utilising the full potential of APIs requires a new business mindset – an API-First approach – that actively seeks ways to build digital business models, foster an ecosystem, empower IT architecture, and support cross-team productivity.

APIs support efficiency in many areas but primarily help improve the speed of processes compared to legacy systems. While maintaining core system assets, APIs allow standardising data for use in multiple departments across the business which minimises potential human errors and enhances agility.

Beyond increasing accuracy and improving on current procedures, API enables expanding businesses to access new services. With entry access to the organisation's data and core systems, it becomes easier to build up the system's functionality or third-party integrations, creating an environment and culture that delivers both innovation and digital leadership while allowing banks to evolve in line with industry demands.

Rory Blundell CEO Gravitee