Technology Banker September / October 2014 by Technology Banker

The Voice of Technology and Finance in Africa

www.technologybanker.com

September/ October 2014 £3.99

A JEWEL IN THE CROWN I&M’s four pillars of

success I&M interview: the award-winning bank puts forward its vision for the future

How to optimise African

banks Enterprise architecture – helping banks to become better information systems.

Vibrant future for islamic

finance An in-depth look at Africa’s vibrant market for Sharia-compliant technologies.

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WELCOME CONTENTS Africa now boasts six of the world’s 10 fastest-growing economies, according to Bloomberg. This is largely due to technologies, such as Cloud, Big Data and analytics, Mobile and Social. These are no longer buzzwords as they are now playing a vital role in helping African banks to streamline their operations, increase flexibility, reduce costs and generate a better performance from their IT investment. There is no doubt that the outbreak of the Ebola virus disease, which started in Guinea, now has serious economic implications in the entire West African sub-region as the outbreak is a major health hazard that has caused a number of countries to close their borders.

Executive Interview with

Adedoyin Odunfa, Managing

Director and CEO of Digital

Jewels. 14

The benefits of the Cloud and

how it enables banks to do much

more with much less.

I&M interview: the award-

winning bank puts forward its

vision for the future.

Why Nigeria is facing a worrying

rise in cybercrime.

Enterprise architecture –

helping banks to become better

information systems.

Too complex to compete – why

simplicity is the new imperative

for African banks.

The biggest economy in the West Africa region, Nigeria has reaffirmed its committed to containing the Ebola virus disease in the country, according to the Minister of State for Health Dr. Khaliru Alhassan. The good news is – Africa remains economically vibrant and is still expected to reach a five per cent overall growth rate in 2015. As always, we would love to hear from you, our readers, so please write to us and send your views by email. Warm Regards,

Remi Akinjomo Managing Editor

Contact Details: Publisher - Stefan Grossetti Editor - Ian Powell Deputy Editor - John Bennett Sales & Marketing - Jenny Howard Managing Editor - Remi Akinjomo Head of Operations - Monika Derfinakova Head Office: 10th Floor, 88 Wood Street, London EC2V 7RS Tel: +44 (0) 208 528 1536 info@technologybanker.com www.technologybanker.com

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The contents of this publication are subject to copyright protection and reproduction in whole or part, whether mechanical or electronic is expressly forbidden without prior written consent of the editor. Views expressed in the publication do not necessarily reflect those of the editor or publisher. We welcome contributions, however, publication is at the discretion of the editor. We also take no responsibility for the return of materials. Whilst every care is taken to ensure accuracy, we cannot be held liable for any inaccuracies. All rights reserved.

©Technology Banker 2014 ISSN 2051-9443

SEPTEMBER / OCTOBER

NEWS IN BRIEF

Airtel to deepen ICT usage in rural areas

irtel has announced a new initiative that focuses on creating awareness for Information and Communication Technology use and uptake in the rural areas of Nigeria.

The telecoms services provider said the scheme is part of its strategic effort to empower more Nigerians. The programme is designed to help consumers living in or visiting the designated locations in underserved communities, enabling them to have first-hand experience of the company’s data services with no financial implications to the consumers. According to Airtel, the programme will also assist to facilitate ICT/Data penetration in the country’s rural settlements. Airtel’s Chief Commercial Officer, Maurice Newa, said the aim of the new programme was to bridge the gap between consumers in rural settings and the world of opportunities before them.

F5 and VMware agree to combine technologies

5 Networks and VMware announced in August they would allow interoperability between F5’s BIG-IQ management platform and the VMware NSX network virtualisation platform. This will enable rapid orchestration of layer 2 to 7 network and application services in the software-defined data centre (SDDC). The idea is to allow customers to combine the NSX platform’s network service automation with F5’s application delivery service management. “Our goal is to make it even easier for customers to reap additional benefits by combining the companies’ technologies,” said Manny Rivelo, Executive Vice-President for Strategic Solutions at F5 Networks.

Avaya and HP ES offer African enterprises cloud services

vaya and HP Enterprise Services (HP ES) have signed an agreement stating that they will offer cloud-based unified communications and contact centre technology, as well as management solutions for enterprises. The two companies will sell a combined portfolio of unified communications as a service, contact centre as a service, and infrastructure modernisation services. HP ES Business Process Services will assume service delivery of a significant portion of Avaya Private Cloud Services (APCS), including a limited transfer of APCS employees and contractors.

SEPTEMBER / OCTOBER 2014

National eID card launched in Nigeria

igerian President Goodluck Jonathan received his National eID card at a celebratory event in Abuja last month, heralding the official launch of the eID pilot program. In the pilot phase, the Nigerian Identity Management Commission (NIMC) will issue MasterCardbranded identity cards with electronic payments functionality to 13 million Nigerians. It is the largest rollout of a biometricbased verification card with an electronic payment solution in the country, and the broadest financial inclusion program in Africa. Nigerians have to register for the card, which forms a key component of the Nigerian Identity Management System. With 13 applications, including MasterCard’s prepaid payment technology and Cryptovision’s biometric identification technology, the eID card will provide millions of Nigerians – the majority of whom have never had access to a banking product before – with the security, convenience and reliability of electronic payments.

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NEWS IN BRIEF

Glo Xchange begins deeper collaboration between banks

he Governor of the Central Bank of Nigeria, Godwin Emefiele, has described Nigeria’s first Mobile Money Super Agent Network, Glo Xchange, as the beginning of a deeper collaboration between the financial sector and the telecommunications industry. The Glo Xchange platform was launched by Globacom in partnership with three licensed mobile money operators, FirstMonie, Ecobank and Stanbic IBTC, in Lagos on 21 August. Globacom’s Head of Corporate Sales, Mr Kamal Shonibare, said Glo Xchange would avail the mobile money sector of a much needed agent network across the entire country, as well as the technology platform required for seamless mobile money transactions.

Western Union launches first Outbound Service

he Western Union Company has launched the first Outbound remittance service in Nigeria.

It means the Nigerian community are now able to send funds in minutes via Western Union around the world. First Bank of Nigeria Limited has become the first Western Union Agent to offer this service. The collaboration will enable Western Union consumers, as well as FirstBank’s customers, to enjoy Western Union’s new ‘Outbound send’ offering through the bank’s branches.

Access Bank boosts e-Learning platform

ccess Bank, in collaboration with Intel and Chips, Bits & Bytes Limited, has donated e-education solutions for pupils and teachers of Command Children’s School, Yaba, Lagos. The donation is part of efforts to increase e-learning capabilities and transform education in Nigerian institutions. Country Manager of Intel, Olubunmi Ekundare, said: “Intel will be training the first set of teachers at no cost. This platform allows teachers the opportunity to create a virtual classroom and assists them to deliver lectures without hassle.”

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StanChart leads Zimbabwe facility

tandard Chartered has finalised a three-year US$60mn term loan facility, which aims to introduce significant liquidity to the Zimbabwean domestic banking market. The bank will use the funds to buttress key growth sectors of economic growth, including education, telecommunications and infrastructure. The facility was arranged by a syndicate of lenders and with an Afreximbank guarantee, for FBC Bank in Zimbabwe. Standard Chartered Zimbabwe, Commerzbank and Investec Asset Management are the joint mandated lead arrangers, with Standard Chartered and Afreximbank joint co-ordinators.

New mobile service for smartphones launched in Nigeria

ingTel, in partnership with Ericsson and Samsung, has unveiled the world’s first commercial 300Mbps 4G LTE-Advanced service for smartphones in Nigeria. The service became accessible in August when Samsung Galaxy S5 4G+, which is currently the first smartphone worldwide to be compatible with 4G LTE-Advanced networks, was launched in Singapore. The Samsung GALAXY Alpha 4G+, another compatible smartphone, will be available from September 2014, according to SingTel.

SEPTEMBER / OCTOBER

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Africa’s Leading Distributor of IT Infrastructure Astel is the leading distributor of IT infrastructure, office automation and e-Security solutions in Africa. We have years of experience in the region and understand exactly which products and solutions are needed by computer dealers, value added resellers and software houses to satisfy their customers. We distribute a diverse range of products from the word’s leading manufacturers, meaning Astel need be your only point of call for all your IT requirements.

Ph: +44 208 453 0400 info@astel-uk.com www.astel-uk.com United Kingdom • Kenya • Nigeria

NEWS IN BRIEF

Ghana’s First 4G LTE Network Goes Live

urfline Communications in Ghana has launched the country’s first 4G LTE service with nearly 300 cell sites.

Founder and Executive Chairman, John Taylor said: “Surfline is proud to bring this technology into Ghana for the first time and for Ghanaians to experience the difference that it brings.” Surfline Communications aims to open up the Ghanian economy to new jobs and industries in technology, such as application development, while also helping other sectors, like banking, retail and energy, do business more efficiently. The firm has invested a sum of more than a $100 million to launch the network in both Accra and Tema. Surfline started testing its 4G LTE network in June this year ahead of its commercial launch. It also formed a partnership with Alcatel-Lucent to set-up and deploy the network with capabilities, such as LTE Radio Access Network, Evolved Packet Core and Professional services.

Mobile money to stimulate economic growth

wo renowned economists have said getting the mobile money scheme right in Nigeria will help to stimulate economic growth and increase the velocity of money in the country. Bismarck Rewane, CEO of Financial Derivatives Company Limited, and Dr Ayo Teriba, macroeconomics expert and CEO of Economic Associates, spoke at the launch of Glo Xchange, which they described as an essential ingredient for accelerating the mobile money explosion in Nigeria.

Mr Rewane said the initiative was consistent with the Central Bank of Nigeria’s policy thrust of developing an efficient payment system to drive an increase in the velocity of money and consequently, stimulate economic growth.

Skye Bank introduces electronic payment solution

kye Bank Plc has launched an electronic point of payment solution that will enhance more revenue for development for Ikorodu North Local Council Development Authority. Unveiling the solution at Ikorodu, Group Head, Skye Bank’s Revenue Collection and Franchise, Bola Allison, said the product will check leakages and corruption in the collection process. The product, known as point of payment (PoP) solution, ensures that all citizens pay their taxes, levies and other statutory payments through customised point of payment terminals.

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Fidelity Bank raises $127.3 million

idelity Bank Ghana Limited has announced the completion of its $127.3 million Capital Raising Exercise to inject more capital into the operations of the Bank. The Transaction included a Tier I and Tier II capital raise of $ 67.3 million and $60 million, respectively. It has been approved by the Bank of Ghana and positions Fidelity as one of the best capitalised banks in the country’s banking industry. Kagiso Tiso Holdings (KTH) Proprietary Limited of South Africa, Amethis Finance and Edmond de Rothschild Europportunities Management II of France invested a total of $67.3 million through a combination of ordinary and preference shares under the Tier I capital funding program.

Stanbic Bank launches risk management training

tanbic Bank is providing training to help its clients to manage financial risks that affect the growth of business. The bank, which is part of Standard Bank Group, is mainly helping clients who are currency sellers and recently organised a Foreign Currency Risk Management seminar. The seminar was held because the bank observed that corporate clients, in the ordinary course of doing business, are exposed to foreign currency fluctuations.

SEPTEMBER / OCTOBER

BUILDING FORMIDABLE

INSTITUTIONS. B R I C K

B Y

B R I C K

Developing Capacity & Capability by Strengthening IT Processes, People, Controls, Security & Governance across Africa. Digital Jewels Limited is an Informa�on Value Chain Consul�ng and Capacity Building Firm with a focus on IT Governance, Risk & Compliance and with deep competencies in Informa�on Security, Informa�on Assurance, Project Management, e‐business & Knowledge Capacity Development. The Firm is the First and Only Professional Services Firm in Africa to be accredited to the ISO27001 Global Standard for Informa�on Security and is also a Payment Card System Industry Data Security Standard Qualiﬁed Security Assessor (PCIDSS QSA).

C O N TA C T U S T O D AY

Secure . Assure . Enable . Empower . Manage Plot 12, Frajend Close Osborne Foreshore Estate, Ikoyi Lagos. +234(0) 815 200 0120 | www.digitaljewels.net

digitaljewels

@digitaljewels

EXECUTIVE INTERVIEW

A JEWEL IN THE CROWN Adedoyin Odunfa, Managing Director and CEO of Digital Jewels Ltd, talks about innovative ways to improve information security and assurance, the company’s open web TV station and Africa’s fast changing technological landscape.

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SEPTEMBER / OCTOBER

EXECUTIVE INTERVIEW

AN YOU TELL US MORE ABOUT DIGITAL JEWELS? WHAT IS BEHIND THE NAME AND IN WHAT WAYS ARE YOU HELPING YOUR CUSTOMERS TO INNOVATE? Digital Jewels Limited is an information value chain consulting and capacity building firm with a focus on IT governance, risk & compliance, as well as deep competencies in information security, information assurance, project management, e-business and knowledge capacity development. We are the first and only professional services firm in Africa to be accredited to the ISO27001 Global Standard for Information Security, and are also a Payment Card Industry Data Security Standard Qualified Security Assessor (PCIDSS QSA). We focus on assisting private and public sector institutions across Africa to strengthen IT governance, risk & compliance systems, through the implementation of global best practice standards, frameworks and methodologies that enable the optimal performance of process, people and systems. This goes to the heart of the widespread challenge across public and private sector institutions in Africa, which typically suffer from weak governance, risk and compliance practices with glaring and worrisome results. Our work entails supporting clients to improve thier information security and assurance posture and vulnerability profile, as well as their technology delivery capacity, capability and overall performance. This is achieved through painstaking diagnostics, informed direction setting, astute project management and assurance, holistic capacity development and corporate and individual certification. We are the leading IT GRC Firm in Nigeria, evidenced by the number and scale of successful interventions related to implementing global best practice standards across Nigeria. Of

note is our groundbreaking work in supporting certification in IT related ISO standards, including ISO/ IEC27001, ISO/IEC 20000, ISO22301, PCIDSS, the Payment Card Industry Data Security Standard, and Frameworks such as COBIT (Control Objectives for Information & Related Technology and ITIL) Information Technology Integrated Library. We implement these standards for a select group of clients in banking, telecoms, e-payments and the public sector. These assignments invariably involve a current position assessment that could involve the conduct of vulnerability assessments and penetration tests, business impact analysis, risk and compliance assessments and process reviews. We then work with clients to close identified gaps by streamlining and strengthening processes, training staff and implementing controls to prepare them for certification. Our track record has led to Nigeria’s banking regulator, the Central Bank of Nigeria, appointing us as assessors to the banking sector on multiple standards (PCIDSS, ITIL, and several ISO standards). Digital Jewels’ second core aspiration is to build up a highly skilled crop of Africans that can perform exceptionally anywhere in the world, building new age capacity and capability for Africa. We aim to build centres of excellence, one company at a time, one person at a time. Our capacity and capability development efforts encompass e-learning, through the development and deployment of intelligent Learning Management Systems and media rich content, based on best practice adult learning techniques. We also conduct a wide range of instructorled training for global certification and non-certification based courses and have trained thousands of IT professionals in Nigeria and beyond. Our specialised recruitment services

SEPTEMBER / OCTOBER 2014

equip clients with information age skills that range from C level staff (CIO, CISO, CRO, CIA, etc) to operational level staff, including programmers, information security analysts, service desk professionals, and more. Our Capacity and Capability building initiatives include the Information Value Chain (IVC) Breakfast session, a knowledge sharing, information exchange and business networking forum that enables professionals and business executives to catch-up with new trends, share their experience and interact. Over 60 astute thought leaders have contributed their knowledge and experience through these interactive thought generating, insightful and informative sessions, which have produced The Chronicles of Thought Leaders 1 & 2 publications, available at www.digitaljewels.net. Last December, we launched an open web TV station, called www.scoopit. tv, aimed at informing, stimulating innovation and providing deep insight to the business community. It features some of our IVC recordings and inspiring interviews from accomplished thought leaders in the banking, telecoms, e-payments, capacity building, FMCG and the public sector. Our name is derived from “Digital Crown Jewels”, a well known term in the information security field, which references information as a valuable asset. It also connotes our role as Information Value Chain consultants that support organisations

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EXECUTIVE INTERVIEW of 25th, with a penetration ratio of 41% (Ref: ITU). In Africa, ITU predicts almost 20% of the population will be online by the end of 2014, up from 10% in 2010.

in extracting value from information by securing, assuring, enabling, empowering and managing their information assets. We focus on those often overlooked, but distinguishing capabilities along the Information Value Chain, which bring to bear our knowledge of global best practice and experience in the local operating environment. At the core of the Information and Communications Technology (ICT) revolution is INFORMATION, an asset of personal, organisational and national value, which is an enabling, empowering asset worth securing, assuring and managing: the crown jewel of the astute professional, the progressive business, the visionary corporation and the farsighted nation.

Nigeria also leads the pack in the push to create a cashless society and the associated preponderance of e-delivery channels, backed by the bullish banking regulator. Overall, African banks are critical drivers of the changing landscape as they are aggressive technology adopters. The GSM communications revolution experienced in Africa, through the introduction and rapid uptake in mobile telephony, continues to play a part in the emerging technology landscape, making mobile banking and mobile payments a huge success in many parts of Africa, notably East Africa, and an anticipated success in West Africa, notably Nigeria. Africa and Asia and the Pacific are the regions with the strongest mobilecellular growth (and the lowest penetration rates), with ITU predicting that penetration will reach 69% and 89%, respectively by the end of 2014.

AN YOU DESCRIBE THE CURRENT TECHNOLOGY LANDSCAPE IN AFRICA? The technology landscape in Africa, particularly in Sub-Saharan Africa, is fast changing and extremely dynamic. Over the last 5 or so years, it has changed drastically, as is evident from the indices discussed below.

The deployment of technology in the public sector across Africa is another notable trend, with Federal and State Governments, as well as their MDAs (Ministries Departments and Agencies) using technology primarily to accelerate Internally Generated Revenue (IGR) and access to its citizens.

Internet penetration has witnessed a significant jump over the past years in Africa, growing 2% to 16% between 2010 and 2013. Currently, Nigeria leads the pack with an estimated 56m people online, placing it at number 8 globally, albeit with only 33% penetration due to her large population. Egypt follows with an estimated 37m people online, placing it at number 15 globally, with a penetration ratio of 44%. South Africa has an estimated 20m online ranking

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HAT ARE THE CHALLENGES THAT FACE THE TECHNOLOGY INDUSTRY IN AFRICA? Whilst significant progress has been made, the industry is still plagued with age long growth inhibitors, the principal one being the epileptic power supply, which is perhaps most glaring in Nigeria. This necessitates the need for alternative power supply systems and increases the operational costs and management overhead of technology systems.

Many large organisations set up their own power farms, consisting of multiple generators and inverters and dedicated manpower. Whilst access to bandwidth has improved significantly, it is still relatively limited, especially in countries like Nigeria with a huge population and geographically removed rural areas. In particular, penetration of fixed-broadband subscriptions in Africa remains very low, accounting for less than 0.5 per cent of the world’s fixed-broadband subscriptions, despite double-digit growth over the last four years. The ITU predicts that 44% of the world’s households will have internet access by the end of 2014. Close to one-third (31%) of households in developing countries will be connected to the internet, compared with 78% in developed countries. In Africa, only about one out of ten households will be connected to the internet, although household internet access continues to grow at doubledigit rates. The last mile challenge continues to be a growth inhibitor, although it has been aggressively addressed recently through Nigeria’s Ministry of Communications Technology and other forward-looking institutions. Security remains a nagging challenge, spanning the physical security, technical and administrative dimensions. With the uptake of electronic delivery channels, such as the internet, ATM, POS terminals and mobile phones, there has been an expected increase in fraud in many African countries. Cyber Security has therefore become a topical issue and is being addressed with varying levels of effectiveness across the continent. We conducted a recent research project, Nigeria Cyber Threat Barometer 2014, in collaboration with the South African-based Wolfpack Information Risk Pty.

SEPTEMBER / OCTOBER

EXECUTIVE INTERVIEW (See pages xx for full details.) The groundbreaking report helped to assess the growing menace of cyber security and indicated that critical factors for combating cyber crime, such as a strong regulatory framework, widespread individual and institutional awareness, effective control frameworks, technology-based safeguards, etc, are yet to be put in place or be effective in Nigeria, as in many African countries. Hence, the risk management practice is yet to catch up with the fast-paced technology developments in the continent. In addition, there is a critical shortage of specialised skills to power the rapid development of technology across the continent. This is particularly glaring in the banking and telecom sectors, given their fast pace of technology adoption and significant scale of deployment. Of particular note are the skills shortage in Information Security, IT Architecture and Governance.

OW DOES TRAINING HELP FULFIL THE OBJECTIVES OF THE EVER SO CHANGING COMPLIANCE AND REGULATIONS IN THE BANKING SECTOR? As is popularly said, knowledge is power. Training helps to develop specialised capability and capacity, which is much needed to comply with the changing and increasingly complex technology related regulations. In Nigeria’s banking sector, this is currently very focused on instituting shared services and standards, which have established best practice references to draw from. We provide training on global standards, frameworks and methodologies to expose clients to the best practice approach and help them implement these through our knowledge of our operating environment, competitive landscape, local and institutional culture, risk appetite and specific requirements.

To build professional and institutional capacity, we offer e-learning, instructor-led generic and customised training as well as specialised recruitment services, including our industry-acclaimed Information Value Chain Breakfast Forums.

HAT ARE THE THREE MOST IMPORTANT PROFESSIONAL BEHAVIOURS OR CHARACTERISTICS THAT HAVE HELPED YOU TO BECOME A CEO/MANAGING DIRECTOR? My years of experience in the industry, educational and professional exposure and, in particular, God’s favour have armed me with great vision and foresight and a good understanding of the market place in which we operate. This has helped us to identify critical, yet underserved areas of the market, develop strategies, systems and techniques to add distinctive value to our chosen stakeholders and always be steps ahead of the competition. We also enjoy strong mutually beneficial relationships with key stakeholders, including clients, industry regulators and the industry as a whole, and have a strong value system comprising of integrity, professionalism, resourcefulness, openness, tenacity and a large appetite for knowledge. Overall, I must acknowledge, with all humility, the amazing grace and favour of God upon my life, recognising that many have done the above and even more without comparable results.

HAT ARE THE THREE BIGGEST MYTHS ABOUT HOW WOMEN CAN BEST ADVANCE IN THE WORKPLACE? There are several, but permit me to focus on those particularly prevalent in Africa. The biggest is that, “You can’t have it all – you can’t have a successful career, marriage and family”. I disagree with this

SEPTEMBER / OCTOBER 2014

entirely. Without doubt, it means working harder and smarter, it requires greater determination and tenacity, it necessitates huge doses of resourcefulness and faith, but it can be done. A woman can be as successful, indeed more successful, than a man in the workplace. It depends on the individual. Another common one is, “You can’t do it without a “godfather”. Again, I disagree. If you arm yourself with the requisite competence, tenacity, boldness and courage, why do you need a “godfather”? There is a place for role models. Mentors can be of value, but they can be either male or female. Ultimately, they can only advise, encourage and maybe even assist with opening some doors, but you still have to do the knocking, you still have to walk through those doors. I encourage every career woman to put in their best, to run the race, to see men and women in the workplace as fellow colleagues, collaborators and professionals. Do not expect either favours or discrimination on account of your gender. Where you find it, be grateful for the favour, address the discrimination and carry on. For female entrepreneurs, remember you are walking the road less travelled, so expect obstacles and use them as climbing stones, not barriers. Build a strong support structure of family and other professionals and associate with those with a ‘can do’ spirit’, don’t take no for an answer. Choose carefully – your career, your spouse ¬and be proactive not reactive. Seek for opportunities in challenges and have faith in God.

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AFRICAN BANKS TAKE TO THE CLOUD

Elia Tsouros, Acting Executive for MTN’s Group Enterprise Business Unit

SEPTEMBER / OCTOBER 2014

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INFRASTRUCTURE

Elia Tsouros explains how African banks are increasingly adopting the Cloud and gaining immense value, increased efficiencies and a competitive edge from utilising its services.

At the start of 2014, predictions for the financial services industry emphasised a quick adoption of the Cloud as a means of reducing costs. Midway through the third quarter of the year, and those predictions are proving somewhat true. While security remains a primary concern, particularly for retail banks, the industry seems to be opening up to the idea that adopting Cloud services can help it to increase flexibility, improve efficiencies and streamline operations to drive higher growth and profit margins, while reducing costs.

EXPANDING IT INFRASTRUCTURE

The financial services industry has a growing need for digitising services, as banking and financial services are increasingly becoming self-service oriented. For a self-service oriented business, access to customer data needs to be highly secure, very scalable and quickly accessible. The need for expanding IT infrastructure to meet these needs is a major challenge. MTN Cloud supports a range of options for businesses to expand their

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concentrate on their core business.

INCREASING SECURITY

IT infrastructure. From state-of-the-art hosting and co-location facilities all over Africa, to highly flexible ‘server virtualisation’ services. These facilities are accessible over a secure private network or the public internet. This infrastructure also provides off-theshelf Microsoft and Linux server licences in order to run enterprise applications. This managed services element means banks and financial institutions alike do not have to spread themselves thin on resources (including time, people and money) to manage ICTrelated infrastructure and services. This then gives them a much-needed competitive edge by allowing them to

With Cloud services enabling access to data at any time, from anywhere, security is a primary concern for retail banks. These institutions have to ensure that business and customer data is always available, secure and uncorrupted, and able to meet evolving regulatory commitments. To meet these needs, MTN offers a rich portfolio of end-to-end communications services, system expertise, extensive infrastructure development knowledge and advanced support structures. This includes state-of the-art hosted data security solutions – such as AlertSec and McAfee Antivirus and Anti Spyware – which ensures that business laptops, desktops and servers are protected against unwanted access, manipulation and data leaks or theft. Such solutions offer superior disc encryption, anti-virus, anti-spyware, firewall, cloud-based email protection, email server anti-spam, safe web searching and content web filtering.

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to create websites for information sharing and document collaboration, enables teams to share data and create extranets for collaboration securely. As a platform for portal development, team workspaces, email, presence awareness and web-based conferencing, MTN Cloud Collaboration SharePoint securely stores critical business information in a central data centre, which can be accessed anywhere using any web browser. This enables cost efficiencies, sharing of knowledge and the easy location of distributed information.

This enables staff to access the internet securely, protecting the bank against the vulnerabilities created by a remote or mobile workforce. In cases where banks have chosen to utilise their own infrastructure and leverage off MTN’s connectivity, hosted at an ISP datacentre, MTN caters for Sas70, ITIL and PCI certification services to meet financial legislative security compliances.

CLOUD COLLABORATION

Once the security hurdles are over, Cloud Services can be greatly benefit collaboration by enabling remote or mobile workforces to interact and communicate better. With the right collaboration tools, employees can access the right expertise and information when they need it, and thus work together to meet their business goals. For example, live video conferencing tools can be used to host meetings and training sessions with staff from different branches or with other stakeholders, eliminating the need to travel and thus reducing travel-related expenses. In addition, staff from any branch or office on the continent is able to form virtual teams and share expertise and best practice to enhance collaboration. MTN Cloud Collaboration Sharepoint, a hosted platform that allows teams

interact via email and know that data is archived and safe.

CUSTOMER RELATIONSHIP MANAGEMENT

BACKUP SERVICES

Cloud services offer the potential to enhance relationships with customers. MTN Cloud CRM, which focuses on real-time business intelligence that is available online through CRM dashboards and charts, can improve the productivity and effectiveness of sales, marketing and service (helpdesk) staff. This hosted customer relationship management solution offers a tailored client relationship management tool, a single hub to access information, integrated marketing and sales and service tools to create a single source of relationship information. Cloud marketing services, such as CakeMail, on the other hand can enable banks to run customised campaigns internally and externally that will drive awareness of their new products and services to new and existing customers, and this can be bundled with MTN SMS offerings.

MTN utilises Mozi Backup for the backup of documents on laptops and desktops over the internet, with an encryption level of 256 bits aes. This is military grade, ensuring that the data is secure. Banks require no storage infrastructure, IT expertise or software licences and can have peace of mind that their data is always safe and there is minimal downtime in the event of a disaster.

For a retail bank the question might be, why utilise MTN Cloud to obtain such services when these can be purchased individually and directly? The reason is simple – MTN Cloud enables the convenience and simplicity of obtaining a myriad of services and resources from a single vendor. In addition, the total cost of ownership reduces as banks will not require their own hardware, infrastructure, resources and licences, or have to manage the integration of the different elements. There is also no customisation required as the MTN Platform will be preconfigured to suit the bank’s needs. Essentially utilising the MTN Cloud services allows banks to do much more with much less – increasing efficiencies, reducing costs and providing an enhanced way of doing business.

A recent study by Forrester Consulting (Cloud Backup And Disaster Recovery Meets Next-Generation Database Demands, March 2014), which surveyed 209 organisations in North America, Europe and Asia, found that enterprises are increasingly using the Cloud for backup and disaster recovery of data. This not only helps to facilitate business continuity in the event of data loss, but also reduces storage costs and enables organisations to back up more frequently. Utilising MTN’s managed backup services, retail banks are able to backup their critical business data to ensure that, in the event of a disaster, they can bounce back rapidly and easily.

MTN also offers Microsoft Hosted Exchange, which supports anywhere access from PCs, the web and mobile devices. Importantly, the system allows for the sending of sensitive data by using encryption and also allows for data archiving for 3-5 years. This enables financial institutions to

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ENDLESS BENEFITS

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SEPTEMBER / OCTOBER 2014

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I&Mâ&#x20AC;&#x2122;S FOUR PILLARS OF SUCCESS

Rohit Gupta of I&M Bank answers questions about digital engagement, the emergence of new technology and its vision and philosophy for the next five years.

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THOUGHT LEADERSHIP

Rohit Gupta General Manager ICT (Group) I & M Banks Kenya NAMED AS THE “WORLD’S BEST EMERGING MARKETS BANKS IN AFRICA” FOR SIX CONSECUTIVE YEARS, WHAT IS I&M’S VISION AND PHILOSOPHY FOR THE NEXT 5 YEARS?

I&M Bank always remains focused on its desire to better serve its customers through its philosophy of offering a premium banking experience. We aim to exceed customer expectations, in terms of our quality of service and by offering a wide choice of innovative products. We will also be refining the our business models in the face of mounting competition, a rapidly changing and increasingly challenging social, political and economic environment across the region. The Bank’s vision and philosophy for the next 5 years will be established on the following four pillars – business growth, technological innovation, operational efficiency and capacity development.

DO YOU AGREE WITH WARREN BUFFET WHO MADE A BOLD AND PROFOUND STATEMENT THAT, “CULTURE, MORE THAN RULE BOOKS, DETERMINES HOW AN ORGANISATION BEHAVES?” The statement also describes I&M Bank’s philosophy. We are very particular about our reputation

while dealing with the regulation, customers and/or stakeholders.

HOW DO YOU SEE THE EMERGENCE OF TECHNOLOGY, INCLUDING THE INTEGRATING OF PAYMENTS INTO CRM?

This is now emerging as an important business need, as several alternate banking channel transaction patterns need to be integrated into CRM to analyse customer behaviour for better innovative and more efficient customer services.

WITH INTERNET BANKING SERVICES AVAILABLE, HOW DOES I&M ENGAGE WITH CUSTOMERS DIGITALLY?

I&M Bank has always been the market leader in launching technologybased services. Our Internet Banking and Mobile Banking services offer a wide range of unique and customer preferred services. Apart from our Internet/Mobile Banking, we offer services through Alerts/Notifications, Social Media and secured chat. We also regularly engage customers through online/offline feedback for the improvement of technologybased services.

NEW IFRS 9 CAPITAL REQUIREMENTS ARE COMING INTO EFFECT IN 2018, WHAT

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PREPARATIONS IS I&M UNDERTAKING TO SUPPORT THESE NEW MEASURES?

I&M Bank is fully compliant with the requirements of IAS 39, which will be overtaken by IFRS 9. Since this new section comes into effect in 2018, we have already initiated discussions with our auditors M/S KPMG Kenya on the treatment of lending assets as also investment instruments. From the technology side of things, we will implement the changes in our systems well in time for a complete systems audit.

WHAT BANKING PRODUCTS DOES I&M OFFER TO CATER FOR KENYANS LIVING AND WORKING IN THE DIASPORA?

We have some specialised services for the Diaspora, including a unique funds remittance service through our e-commerce platform, a special Diaspora travel insurance product, a home loan with special features, document facilitation services for purchase of homes, investment management services, a live chat facility through our dedicated Diaspora webpage, and a network of overseas agents in several countries to assist the Diaspora in opening accounts.

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Mobile Money Transfer VTN VCASH and Western Union Mobile Money Transfer service with Western Union and VTN is an easy, fast and convenient way for VTN customers in Nigeria to receive money from abroad on their VCASH account.

In a few quick steps, a Western Union® Money Transfer can be added into a VTN VCASH account in Nigeria. 1 Western Union sender makes a money transfer at a Western Union® Agent location or online on a Western Union transactional website (where available). 2 Sender provides the VTN receiver the Western Union MTCN tracking number. 3 With the MTCN number, the VCASH customer can follow the Western Union menu prompts on their VTN phone to add the funds directly* onto their VCASH account! 4 The VCASH customer will enter their PIN, for user authentication. Additional information about the transaction may also be requested. (See diagram below) A 1. Send Money 2. Western Union 3. Check Balance 4. Mobile Top-up 5. Pay Bill Select

Western Union

1. Pick-up money

Western Union

Please enter 10-digit Western Union MTCN: _ (3 unsuccessful attempts will result in account blocking)

Select

Cancel

Select

Cancel

Western Union

Please enter the amount you are expecting to receive: _ (3 unsuccessful attempts will result in account blocking)

Select

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Western Union

Please enter your PIN to continue: _

Pick-up Confirmation: Western Union has deposited XXXXX into your account No. 00045XXX

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5 The VCASH customer will receive an SMS notification confirming the deposit of funds into VCASH.

If the Western Union sender provides their mobile number on the Western Union Send Form, they will also receive a text message when the funds are delivered1.

Did you know? VCASH consumers in Nigeria can use funds in their VCASH account as determined by VTN, including: • Pay bills • Withdraw cash • Purchase airtime • Buy goods and services For more information, visit virtualterminalnetwork.com or WesternUnionMobile.com Available through:

* Funds will be paid to receiver’s VTN VCASH account provider for credit to account tied to receiver’s mobile number. Additional third- party charges may apply, including SMS and account over-limit and cash-out fees. Funds availability subject to terms and conditions of service. See Send Form for Restrictions. ** Service options are determined by the mobile phone service provider. 1 Standard Message and Data rates may apply. VTN, VCASH and the VTN logo are trademarks of Virtual Terminal Network. © 2013 Western Union Holdings, Inc. All Rights Reserved.

SPECIAL FEATURE

Nigeria 2014 Cyber Threat Barometer Internet uptake has increased significantly over the past few years in Nigeria, leading to growing fears of rising cybercrime. Here is an excerpt from a groundbreaking new report that assesses the alarming risks to the country’s cyber security.

Global Best Practice Standard Certification Status in Nigeria, February 2014

This article is an excerpt from the recently launched landmark Nigeria 2014 Cyber Threat Barometer, which looks into the growing menace of cyber crime. This groundbreaking research project was conducted by Digital Jewels Ltd in partnership with the SA-based company, Wolf Pack Information Risk (PTY), and funded by the British High Commission. The research involved a cross section of informed stakeholders, including CEOs, CROs, CISOs, CIOs and information security professionals, across the public (regulators, MDAs, etc) and private sector (financial institutions, Telcos, e-payment companies, etc). The report is endorsed by the Nigeria Interbank Settlement System (NIBSS) and Ministry of Communication Technology. You can download it now at www.digitaljewels.net/ Information Security in Nigeria The state of security as a whole in Nigeria can be described as a quagmire, with multi-faceted root

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causes and multi- dimensional symptoms. The physical security threats are glaring, somewhat regionalised and often situational. The havoc wreaked by the recent insurgence of the Boko Harem extremist group in Northern Nigeria is a sore case in point. Technical and administrative security, as well as its effect and consequences, is still barely understood in many quarters, but the risks are ever present and the impact unmistakable. Holistically, information security is an unfolding and poorly understood concept, particularly within the context of the unfortunate international reputation that Nigeria has of being a haven for security breaches of every dimension. This is particularly the case with advanced fee fraud, or what has come to be known as the 419 scams. Virtual minefields and cyber threats On the surface therefore, it would seem to be a picture of doom and gloom. With internet penetration in Nigeria increasing at a rapid pace (it

is currently estimated to be at 32.9%, representing 55.9 million people), does its impending ubiquity also signal an era of rising cybercrime? Nigerian cyberspace is littered with virtual minefields and cyber threats that appear to be proliferating. Rogue militant communities are joining the ever-growing gangs of hackers in mounting repeated assaults on mainly public sector websites. Private sector websites and other e-delivery channels are also targeted. The growth of e-delivery channels seem to be a double-edged sword as the Central Bank of Nigeria continues to aggressively push the “Cashless Nigeria” initiative, aimed at reducing the volume of cash in circulation.

“The good we secure for ourselves is precarious and uncertain until it is secured for all of us and incorporated into our common life.” – Jane Addams

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ENTERPRISE ARCHITECTURE

HOW TO OPTIMISE AFRICAN BANKS Enterprise architecture is playing a vital role in helping African banks to generate a better performance from their IT investment. John Schlesinger, Chief Enterprise Architect at Temenos, explains how.

When I was a systems engineer with IBM in the UK, we looked after a bank that in 1982 was IBM’s largest customer in Europe. I had already helped it to replace some massive line printers with even larger laser printers, but now I was involved in a much more interesting project. The bank wanted to move to the latest version of the MVS operating system, MVS/XA, in order to take advantage of 31-bit addressing, but it was prevented from doing so by its custom middleware layer called ‘2B’. This was the first time I had heard of

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middleware and it was also the start of my career in enterprise architecture (EA). Thirty years later and there is still little agreement about what EA is and how it helps, especially banks.

INFORMATION SYSTEMS, NOT TECHNOLOGY COMPANIES

John Schlesinger Chief Enterprise Architect

Banks are special because their product is bits, not atoms. The bank’s information system is not just for internal record keeping and management information, it also manufactures, distributes and services the products and services the bank sells to its customers. Most banks use

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their own software for doing this, with about 10 to 15 percent of regulated deposit takers using standard software for their core banking. Some people think this makes banks technology companies, but I donâ&#x20AC;&#x2122;t think this is right. A technology company sells technology to its customers; banks sell banking not technology. I think this makes banks information systems. So how does enterprise architecture help banks to become better information systems? Firstly, the very idea of separating the information system from the technology platform it runs on is an EA concept. Indeed, this is a fundamental concept of the Integrated Architecture Framework, the major EA deliverable that came out of the merger of Capgemini with Ernst and Young consulting. Now that we have cloud-based infrastructureas-a-service, it is clear that a bank does not have to own a data centre in order to process transactions.

GREATER THAN THE SUM OF IT PARTS

A bank will run a large number of

projects to enhance or maintain its information systems at any one time. In fact, some banks employ more programmers than Microsoft. Each of these projects will optimise itself to achieve its own ends on time, on budget and to specification. However, it is very easy for the whole to be much less than the sum of its parts. So the role of EA is to ensure that each of these projects optimises the bank as a whole, so that the whole is greater than the sum of its parts. The way EA does this is by putting a small tax on each project, so that together they build more than just their own project goals. This is very similar to town planning. Here is an example from a real town in New Jersey (told to me by one of my enterprise architects, when I was chief architect at Dun and Bradstreet). There was a street with a broad roadway, but narrow paths down either side. The town wanted to broaden these paths and did so by requiring each house on the street to extend the path directly outside

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the house. This was a pain, as the homeowners got no benefit and people had to drive around their paths. There became so many paths sticking out, cars had to drive down the middle of the road without driving around. At this point the residents started to fill in the gaps for themselves, with a subsidy from the town.

IMPLEMENTING M-SHWARI IN RECORD TIME

With banks becoming online retailers that offer self-assisted transactions and straight-through processing, EA is helping them with their performance more than ever. These capabilities cut across business ownership and require town planning techniques to achieve. Banks are also being forced to move from being back-office focused to being front-office focused to offer Amazon levels of customer care. A good example of the move to self-assisted transactions is the implementation of M-Shwari by Commercial Bank of Africa in Kenya and Tanzania. This required our

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customer, the bank, to implement eight new interfaces. Four of these were system-to-system and four person-to-system. These kinds of interfacing requirements are EA’s concerns as they naturally cross system ownership boundaries. The enterprise architecture enablers we delivered to the bank – our integration framework and (subsequent to this project) our interaction framework – have helped the bank to implement the system in record time. For this functionality to be achieved, the system as a whole must become real time. For example, when I was working with a large UK bank to install standard core banking software, its head of process declared that no bank process should take more than one day to complete. I told him that this meant that, in effect, all processes had to be real time. When he asked why, I replied that sometimes processes had to be combined to create a new process, so if this ever involved two processes that took a day each, then the new process would take two

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days. The only way to ensure that all processes take no more than a day is to make them all real time.

MANAGING THE LOOK-TO-BOOK RATIO

The move from overnight batch processing to real time processing is enabled by enterprise architecture, and is achieved by putting a small tax on each project and then ‘filling in the gaps’. For this to work, the enterprise architect has to understand the strategy of the bank and nudge each project towards achieving it. In turn, this means that EA has to be ahead of the bank in some respects. A final example will illustrate this. When a teller does a financial transaction for a customer, the ratio of interactions that are enquiries to those that update data is about five to one. This is referred to in travel as the ‘look-to-book’ ratio. When the travel industry moved from travel agents to booking engines like Expedia, the look-to-book went from 5 to 1 to 1000 to 1. The same thing is happening now to banking. As the internet bank,

the mobile bank and then the Internet of Things replaces bank tellers, we, the enterprise architects, expect the look-to-book ratio to go from 5 to 1 to 5000 to one. This is happening fastest of all in developing banking markets like Africa, where rising GDP is moving large numbers of the previously unbanked directly to mobile banking providers, such as M-Pesa and M-Shwari, and skipping the use of physical branches. Providing an information system that can scale up to a thousand times more interactions, while doing the same number of update transactions – the ones that make the bank money – requires an enterprise level change. EA is now nudging each project in this direction, which in our case means providing a data framework to our customers that separates the update database from the enquiry database. This makes it much cheaper to service the thousand times increase in queries, while lowering the cost of transactions.

SEPTEMBER / OCTOBER

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ISLAMIC BANKING

VIBRANT FUTURE FOR ISLAMIC FINANCE Rosie Kmeid reports on how Islamic finance is continuing to revolutionise Africaâ&#x20AC;&#x2122;s banking industry and is looking at the latest technology to elevate business performance, increase efficiency and grow market share. Business activities that are in line with the provisions and principles of Sharia have been a feature in the Arab world for over a millennium, but recent years have seen modern Islamic finance establishing itself as an important component of regional economies. As new geographies continue to open up, industry forecasts suggest that modern Islamic finance will continue to enjoy a solid and vertical growth, fuelled by greater acceptance and a surging demand for ethical financial products. Despite this, the value of the market is not well perceived and largely underestimated, and the Islamic financial services industry is challenged with figuring out how to serve it effectively and profitably. Across world markets, and particularly in the GCC, South East Asia and Africa, the strategy has been to encourage the development of a healthy Islamic financial sector to contain and reach out to large unbanked populations, currently estimated at 2.5 billion. There is enormous potential and opportunities out there for Islamic financial institutions to offer a wide range of Sharia-compliant, highquality, reasonably priced financial products and services.

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Investments in innovative Shariacompliant financial services for the unbanked offer many incentives, not only in profitability and cross-selling opportunities, but also in reducing financial ignorance and inaccessibility around the world, as well as paving the way for sustainable growth.

ONE BUSINESS MODEL COMPLEMENTS THE OTHER

Islamic banking is more complex than traditional banking in that products and services must conform to the requirements of Sharia. This requires the use of sale contracts, leasing arrangements, agency fees, profitsharing deals and other types of agreements. Islamic banking practices and regulations vary from one country to another and one of the major challenges that the industry is facing is the absence of a single interpretation of Sharia law, given that there are different schools of thought. There remains a number of controversies about the ideal practices in Islamic banking and the role of Sharia boards in harmonising Fatwas that are required to minimise complexities in structuring Islamic financial products. Attempts have been made to improve standardisation by organisations,

Rosie Kmeid Vice President Corporate Communications & Marketing

Powering Islamic Financial Markets

such as the Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI) and the Islamic Financial Services Board (IFSB), but such standards are not mandatory, nor universally accepted. This leads to the absence of conformity across Islamic banking operations, and so a universal consensus of what was

SEPTEMBER / OCTOBER

ISLAMIC BANKING

described above would catapult the Islamic finance market to exponential levels. Industry experts widely acknowledge the significant role of Islamic finance in the global financial system. The industry has clearly demonstrated its ability in helping to restore and maintain financial stability worldwide. The wide acceptability that modern Islamic finance enjoys and the support it attracts from three principal bodies – the World Bank Group, the IMF and WTO – is evident in the numerous initiatives they have undertaken. This is considered enough proof of its viability and relevance to the global financial system, especially in view of the industry’s appeal to leading international banks, such as Citibank, UBS, HSBC, BNP Paribas, Royal Bank of Canada and others. Today, the industry has become systemically important and is too big to be ignored. With Islamic finance moving into the next phase of growth, Islamic financial institutions have the opportunity to assess their current capabilities and leverage them to focus on areas of strength to keep on their current trajectory.

STRIVING FOR GREATER EFFICIENCY

While the inherent strengths of Islamic finance have contributed to its viability and resilience, going forward the foundations for its sustainability as a competitive form of financial intermediation has yet to be reinforced. Despite a number of challenges, the modern Islamic finance remains a demand-driven segment, key to the growth of societies. However, a combination of the impact of the economic environment on business, margin compression and competitive pressures, is forcing Islamic financial institutions to focus primarily on

performance and efficiency. Dr. Kabir Hassan, Professor of Finance at the University of New Orleans, noted in his research study on Islamic finance efficiency that, for the industry to influence the patterns of the global financial system and shape the future, it must move beyond its traditional strongholds. Concerted efforts are therefore underway focusing on the further development of the sector. As part of this process, industry experts believe that the use of highly advanced and globally recognised technologies in Islamic finance activities are highly desired and the only way to enable the industry achieve its full potential. They are confident that the continued development of the sector and its overall expansion are heavily based on the strategic investment in technology and the effective use of Shariacompliant information systems. A cutting-edge technology, combining the best of traditional Islamic values and innovation, able to match the requirements of modern Islamic financial institutions, is integral to overcome the sector’s emerging challenges. Recognising the increasing market demand for Islamic-oriented financial products across multiple geographies, Islamic financial institutions expect to adapt to the nuances of a rapidly growing sector by deploying off-theshelf Sharia-compliant technology and offering their customers superior Sharia-compliant products and services. Such technology, built from scratch on the basis of Sharia, will be completely self-contained, and truly geared to address country and regionspecific Islamic banking requirements. It will have the flexibility to define a full and competitive range of Islamic financial products, the scalability to manage large volumes of transactions

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and the agility to embrace change.

CALL FOR SHARIA-COMPLIANT TECHNOLOGIES

Nowadays, the parade of new technological breakthroughs in the global financial services sector is relentless. The increasingly sophisticated, evolving and transformative technologies will inevitably promote better practices, greater transparency and increased productivity for the entire financial system. With the significant progress modern Islamic finance has achieved in the recent decade, Sharia-compliant technological advancements will play a bigger role in the growth of this phenomenon worldwide. The next few years are likely to see further growth in the development and proliferation of new-generation Islamic technologies, in an attempt to meet the demands of this fast-growing sector. As the sector comes into its own, the latest technologies will enable Islamic financial institutions to not only increase their efficiencies and enhance their customer service, but also considerably cut the cost of their operations. This undoubtedly offers exciting opportunities for these institutions to elevate business performance, gain a competitive advantage and grow their market share. While clearly this is a work in progress, Islamic financial institutions remain optimistic that the adoption of high-performing and proven technologies, which are in line with the requirements of the Islamic law, will continue to revolutionise the sector over the coming years.

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TECHNOLOGY TRENDS

SIMPLICITY IS THE KEY In a banking landscape marred by complexity, agility is the new touchstone and a new analyst report predicts that the simplest will thrive.

From a policy perspective, ‘too big to fail’ warns of the broader economic consequences of failures at large banks. But for banks that are up and running, there’s another phrase that’s raising red flags – ‘too complex to compete’.

Amit Dua Vice-President & Regional Head, Advanced Markets & Global Accounts, Infosys Finacle

For a long time, the sheer size of large banks has given them the competitive advantage of economy of scale. But according to a recent analyst report, this erstwhile advantage has been completely negated by a proportional increase in complexity that has brought into play a new law of diminishing IT returns.

THE NEW NORMAL

“The future of banking hinges on simplifying and transforming banking systems” – Amit Dua, Vice-President & Regional Head, Advanced Markets & Global Accounts, Infosys Finacle

Banks of every size are well aware of the new normal in banking, characterised by sluggish macroeconomics, constrictive regulations, changing customer expectations, non-conventional competition and significant challenges to profitability. The industry response has been to reconfigure existing models in order to lower costs, enhance efficiencies, strengthen compliance, accelerate innovation and create true customercentricity. But IT complexity seems to be the biggest challenge to that reconfiguration effort. Consider these findings from the latest EFMA-Infosys Innovation in Retail Banking study: • The average time to market for

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new offerings at large banks was 11.6 months, compared to 7.8 and 5.8 months for medium and small banks respectively • Only 35 percent of banks have a real-time single view of customer products and transactions • Just 21 percent of banks provide some form of product personalisation to their customers

GREATER FLEXIBILITY REQUIRED

Agility will be the touchstone of competitive differentiation in the new normal, but existing technology infrastructure may well lack the flexibility to deliver. Core transformation of banking infrastructure is no easy task but it has become the strategic imperative, especially for larger banks that have become saddled with stockpiles of disparate technologies accrued over the years. Recent innovations in the banking solutions industry are opening up an interesting new approach to transformation. Today banks are finding that they have the option of modernising progressively by replacing one component at a time. This approach saves them both time and money and presents a lowrisk transformation option that’s a simple solution to what was once a complex problem. In an industry where the value of agility cannot be overestimated, componentisation will surely be a welcome option.

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THE BANKING COLLECTION SIMPLIFYING THE BUSINESS OF BANKING

Simplify. That’s the mantra for banks in 2014. To do so, they will refresh their business models and embrace emerging technologies – from mobility and social to cloud and big data. Get ready for banking in many new flavors.

MOBILE DISRUPTION AHEAD

BANKING COUTURE TAKES OFF

SOCIAL BANKING GETS REAL

Mobile-only banks and innovations in mobility will continue to disrupt the status quo in banking

With wearable devices, banking may be as easy as “Glass, tell me my balance”

Expect socially integrated banking products like spend comparisons and P2P payments

BANK + APP STORE? APP-SOLUTELY

THE FORECAST SAYS CLOUD

GETTING A GRIP ON BIG DATA

Banks and vendors will open up their platforms for developers to create innovative apps

Having built private clouds, banks will increase their presence in the improved public cloud

Banks will use big data to prevent fraud, monitor transactions, and create personalized offers

COMPLIANCE GETS COSTLIER

KEEP IT SIMPLE

LEGACY GETS LEFT BEHIND

Banks will have to deal with new super regulators and existing regulators with super powers

Customers, regulators and bankers will seek simplification in banking

Embracing progressive modernization will help banks replace their old systems one step at a time