12 minute read
Beyond Boundaries
Miljan Stamenkovic General Manager, MENA at Mambu describes how banking technology, driven by factors including customer behaviour and central bank policies, is bringing about a whole new financial services landscape
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Technology providers are playing a critical role in the evolution of the banking and finance industry. Financial services leaders recognize how technology transformation leads to significant competitive advantage. Adopting new banking technology is, therefore, critical for financial services organizations to stay relevant, thrive and to ensure they maintain and expand their market position.
Customer expectations and behaviour remain a driving force when it comes to innovating within banking technology. But the ability to enable change has reached a new level of importance around the world, particularly in the wake of the COVID-19 pandemic. For years, the banking sector has been a digital laggard compared with other industries. Along with growing competition from digital-first banks, the pandemic has had the biggest impact on banks’ digital transformation strategy and accelerated the push from legacy systems to cloud.
New digital challenger banks have been instrumental in taking the latest technology and creating a unique, digitalfirst approach to banking that fits into society’s increasingly digital lifestyle. To remain competitive, banks need to go to market rapidly, and be able to scale quickly and easily while also offering absolute stability, or customers will look elsewhere.
Cloud banking platforms like Mambu take a new approach – banks can innovate like never before by driving the creation of financial offerings, opening up new markets and revenue streams and delivering more profitable models.
Central Bank policies play a pivotal role in advancing the innovation and financial agenda of the region, particularly in relation to a cloud-native technology and an API-first micro-services based architecture, among others.
Due to the support of Central Bank policies and innovation, it is estimated that there are more than 300 (and counting) new digital challengers in banking around the world. Regardless of origin, one of the things these new banks have in common is that they are unencumbered by legacy technology and are able to build their offerings using modern technology and API-first delivery models.
Within banking, customers continue to demand best-of-breed services and evolving technologies continue to support that demand. This will continue to develop as a result of Central Bank policies and this evolution will drive API-first open-banking services, along with the financial services ecosystem around it. Client segments within retail, SME and corporate banking will maintain unique requirements, which will be serviced through state-of-the-art fintech solution providers connected within the ecosystem by API-driven micro services.
Miljan Stamenkovic General Manager, MENA at Mambu
What has changed in recent years is that there are no boundaries in looking at how to rethink a business model. Today you can employ cloud-based solutions and API-driven architectures to create an open banking ecosystem to drive your business. I truly believe in and enjoy working on agile projects. This is where you are constantly thinking of your time to market, or even more importantly time to value. And the best thing is - there is usually almost no burden of legacy technology to slow you down. Today, as a business, we can get the taste of what it is like to create the next generation of financial services. More importantly, we as consumers also get to enjoy all the benefits of this change in the industry.
Exceeding Expectations
Matthijs Eijpe Regional Vice President EMEA, Backbase is precise about the pivotal role of technology, as he talks with MEA Finance about innovation in the banking and finance space
• Innovators: technology providers are driving innovation by bringing to the market new products and services and making them easily accessible to financial institutions. Banks don’t need to reinvent the wheel; they implement the product already developed by tech providers and adapt them to their own needs. Technology providers have a larger R&D team, constantly invest in innovation and manage to attract top talents in order to support innovation. • Influencer: Tech providers are inspiring the market by sharing a vision of the future and how we can reshape the industry. They integrate with the entire ecosystem from banks to other partners, and analysts to bring this vision into reality.
• Cloud development • Emergence of new business models: platform model • Customer driving demand for digital solutions, personalised and easy banking. Lifestyle “super app”
What do you believe are the two most impactful innovations in banking and finance in the past five years?
1.) Mobile only NEO banks, it has really elevated the competitive field and innovations across the banking and finance sector. 2.) Open banking has really created new business opportunities, new business models, new types of fintechs that have moved the banking and finance industry into a more ecosystem versus a more closed one.
Matthijs Eijpe Regional Vice President EMEA, Backbase
What innovations will we see being enabled by banking technology in the next five years?
Technology providers will continue to innovate to meet and surpass the customer expectations. Everything we do at Backbase is with the aim of providing superior customer experience by helping financial institutions to innovate faster. We expect the coming years to bring more innovation in the domain of: • Hyper personalised banking /
Engagement Banking • Intelligent banking with AI to automate process, provide higher customer experience, reduce inefficiencies. • Fully cloud ready banks: from core to front, banks operating on cloud will become a standard, supported by a strong tech ecosystem. • Decentralised financial services, moving the trust from a single institution into any ecosystem one.
Being a business that is key to change and grow in banking and finance, what brings you the most satisfaction?
Helping our customers achieve their goals such as driving digital transformation to maintain a leadership position in their market while facilitating the life of their customers. Working with executives that really apply theory into practice and become a central leader in the transformation journey of the organization they work for.
Home Advantage
Talking with MEA Finance, Sunil Paul Co-Founder & Managing Director & Eljo J P Chief Business Officer of Finesse explain the necessities of efficiently providing working solutions for the GCC’s banking and finance sector, thus enabling them to cope with the serious issues imposed by the sudden demands of the pandemic
The Banking and Financial services industry is facing a lot of challenges due to a combination of ever-changing customer expectations, newer regulations, security and privacy concerns, and disruption from new-age technology companies. A delayed response to these asks can potentially result in organizations in this industry incurring heavy losses.
This is where technology-providers come in. Technology providers have been key in bringing in technologybased solutions to the Banking, Financial Services and Insurance sector (BFSI) over the many years. BFSI companies that invested in technology-based solutions have been able to adapt quickly to the changing dynamics within the industry; the most recent being the Covid pandemic.
The main reason for the drive for technology innovation within regional banks is the need to remain relevant, amidst the ever-changing, unpredictable dynamic within the banking sector.
Take for instance - during the pandemic, the banking sector have had to innovate continuously. On one hand, they needed to provide customers remotebanking functionalities to transact from the safety of their homes. They have also needed to invest in work-from-home (WFH) solutions to enable collaboration between employees. Between these, the banking companies had to continue ramping up with data security initiatives, with an increase in cyberattacks. None of these were imaginable before the pandemic hit. Those companies that were constantly innovating through technology were better prepared to weather the pandemic than those who kept technology innovation on the backburner.
The need to innovate is central to companies in the BFSI sector. Technology acts as a great enabler to innovation and companies that invest in technology will be able to address opportunities and challenges early and bring in benefits quicker.
Sunil Paul Co-Founder & Managing Director Eljo J P Chief Business Officer
There have been many innovative ideas that have positively changed the banking and financial services industry during the past five years. The two most impactful of them in this sector would be use of Artificial Intelligence (AI) and the implementation of increased cybersecurity solutions.
Artificial intelligence has given the banking and financial industry a whole new outlook on how they can meet the demands of customers, and provide them better products that are smarter, more convenient and safer to use. AI has also enabled the industry to reduce fraud
through real-time fraud detection, provide more realistic interfaces (chatbots) and reducing operational costs by automating repetitive work processes using Intelligent Process Automation (IPA).
With greater digitalization of banking services, cybersecurity incidents and threats have gone higher. These databreaches make it difficult for customers to trust banks and hinder their running of operations smoothly. Implementation of a strong cybersecurity process within banks is the need of the hour. Our most common recommendation around cybersecurity has been the implementation of the Zero-trust security model across all infrastructure, internal and external. The model is based on the idea “never trust, always verify”, before providing access.
Finesse, presently one of the most trusted software companies in the Middle East, was founded in 2010 with the vision to revolutionize the technology landscape within the GCC. A major part of Finesse’s client base continues to be the biggest banking and financial services companies in the region.
During the Covid pandemic, Finesse partnered with all its clients to take stock of the situation and provide the best solutions each of our clients needed to have business continuity, be it through Artificial Intelligence (IPA, Chatbots), CRM, WFH suites, or Cybersecurity solutions. This helped not just our banking clients, but it also helped their customers, and their employees get and provide the services needed from the comfort of their home, safe and with peace of mind.
It brings us great satisfaction, as Finesse, to stand shoulder to shoulder with our banking and finance clients in the GCC and solve meaningful problems, solutions to which eventually bring in more happiness and prosperity to the region.
What percentage of your BFSI customers asked your company for a service to support their systems for working from home?
Until Covid-19 arrived, it would have been whimsical to consider operations of Banking, Financial services and Insurance sector (BFSI) being managed outside of the office-workspace. Financial data were held in secure servers and distributed only to machines within a known and trusted network, often within the walls of the office. This approach is understandable as the BFSI happens to be most attractive to cyber-criminals even before the pandemic hit, and it would be sensible to reduce the surface area available for attack.
Like many things, Covid-19 forced a change in strategy within the BFSI space. While organizations were forced to support customers remotely, they also needed staff to support these customers. With regulations in place to promote distancing to reduce the spread of the virus, organizations were forced to fasttrack allowing part of their employees to work from home (WFH).
Finesse supports around 120+ Banking and Financial institutions globally, including 80% of the banks in the UAE. Based on the digital maturity these organizations were at, Finesse helped pivot each of these organization’s efforts at bringing ‘outside the physical workspace’ functionalities to both customers and employees of their organizations.
Briefly describe the products and services that you provided to support your clients for WFH.
As far as WFH is concerned, the top priority for organizations is to keep employees safe, and to take steps to ensure a smooth transition for them to work from home, for uninterrupted business operations. The challenge for organizations is finding the right tools and technology for enabling effective and collaborative work from remote locations.
Finesse has a wide umbrella of solutions designed to help remote workers stay connected and be productive. Most important among those is the Microsoft 365 solutions. Microsoft Teams and Microsoft 365 help employees get work done collaboratively and effectively. Teams and Office also have security features built in, so data is backed by enterprise-grade security.
Chatbots, especially the AI-backed chatbots have been another tool that has immensely benefited the WFH initiative. Appearing online 24/7, chatbots have enabled first level of support by providing quick automated responses to customers from across time zones. Robotic Process Automation (RPA) has been another service that has been in huge demand during the pandemic. RPA bots take over manual tasks, so that employees could support distraught customers better, during these trying times. The bots interact with the system same way as a human does except that the bots can work round the clock and are accurate and faster. The RPA bots could integrate into existing systems quickly and easily at a nominal cost, which also happened to be good news to enterprises.
