Finextra Research: Latest fintech news, analysis, interviews, features and opinion by industry experts

Report

Successful strategies in adopting Hybrid Cloud in Financial Services

The benefits of profitability, cost-management, compliance, agility and efficiency gained from implementing a hybrid cloud strategy are hugely beneficial and yet there are hurdles to overcome to ensure success. A preferred strategy is to design and deploy hybrid cloud at the enterprise level. It is an important contributor to the IT and business transformation of financial institutions and the innovative benefits they seek to deliver at scale and speed. But how much of its use should a business adopt? The full value of hybrid cloud is derived from a holistic strategy, pursuing a transformation program, replacing dependency on disparate IT infrastructure and modernising the way a business performs ideally across the entire organisation. Where an organisation excludes certain business functions and operations from cloud adoption it is an exception. Today, cloud computing is a reality and the use of a hybrid model widely accepted, but there are pitfalls to be aware of. Businesses moving to cloud should be clear on their objectives and goals. What’s clear from the response is 66% of those surveyed have implemented a version of hybrid cloud at a largely functional / operational level. How did this arise? Several common challenges prevent successful migration to a hybrid cloud solution and failure to manage them will often stall or prevent realising the opportunities and optimise the benefit. Some of the common mistakes include the lack of business in-house specialist expertise, failure to analyse the impact and adopt the right implementation strategies- all fundamental business requirements. There is a huge endorsement of adopting hybrid cloud at the enterprise level as many IT executives look for consistency in their strategy. However, many complexities remain, as institutions look to navigate legacy and cultural issues in order to be successful. Download your copy of this Finextra Survey Report, produced in association with Red Hat, to learn more.

29 June 2021 320 downloads

Report

Refreshing Payment Orchestration for a digital future

Digitising processes and services to meet the needs of customers has been a prerequisite for the payments industry, leaving acquirers, issuers, and merchants with no choice but to adapt. The changing landscape has resulted in a need to maintain growth in online activity and has increased the need for payment orchestration. Automating the management of business operations that are tied to authorising, processing and optimising payments can help to alleviate the pressure around adaptation and in turn, time to market and time to revenue. Payment orchestration is the solution. Download this Finextra impact study, in association with WLPayments, to learn why: Simplifying the complexity of payments is required, Upgrading traditional payment orchestration is essential today, and Payment orchestration platforms are the missing link for payment providers.

11 June 2021 418 downloads

Report

Factoring of the Future - Why Factors need to look to the Cloud

The concept of factoring has its roots in financial transactions stretching right back to Roman times, but the COVID-19 pandemic has accelerated the adoption of processes powered by the most modern of cloud-based technologies. Scalability in terms of both performance and business is increasingly important for companies providing accounts receivable factoring. Software as a Service (SaaS) has become an ideal solution for banks and factoring companies both large and small—particularly for those just starting out—due to the many and varied benefits cloud-based systems provide. One of these is the flexible pay-as-you-grow model, which enables organisations to pay only for the services that they use, rather than shell out in advance for a rigid software license fee. It’s a particularly attractive proposition in times of uncertainty, such as during the pandemic, which severely affected global trade. The SaaS model also helps businesses that want to provide factoring services to get up and running quickly. Up-front costs incurred when investing in on-premise servers and IT security can be prohibitive when starting any kind of financial services business, making cloud-based systems ever-more popular. Integration with clients’ ERP systems is also key, and easy to achieve with cloud-based systems that can import invoices and provide transparent reporting. The requirements of clients vary hugely according to the systems and solutions they use, meaning that the flexibility provided by cloud is increasingly important. There are three options when a company needs a factoring system. It can build it in-house, which is increasingly unlikely to be the option taken with so many third party offerings in the market. Building a system in-house also requires a separate development team, an approach that can be costly and time-consuming and lead to unreliable outcomes. Secondly, a company can outsource an external company to write the software—on-premise or cloud-based, based on company requirements. This can be just as costly and resource-hungry, as well as time-consuming. The third option is the SaaS model, which, once minor adjustments are made, provides out-of-the-box and ready-to-go functionality. This avoids having to devote time, resource and cost to development, operational and maintenance processes. Businesses need speed and flexibility in order to stay focused on their growth goals by onboarding new clients, without the need to address potential security risks and maintenance associated with traditional in-house builds. By using the right cloud-based software, banks and factoring companies have access to a wealth of opportunities that are available immediately, instead of having to test, run and develop services in-house. In this way, new businesses can leapfrog forward, tailor-making a microservices offering from a variety of industry tried and tested processes, making new features available to customers with a short time to market. Download your copy of this white paper from Finextra, produced in association with Comarch, which explores the challenges for new and existing factoring companies, how these can be addressed using cloud software, and what it takes in a digital ecosystem to stay competitive and grow quickly.

10 June 2021 252 downloads

Report

The Future of Digital Banking in the UK 2021

Why digital is paramount for innovation leaders. While emerging technology has been leveraged by banking leaders and incremental progress has been made in business-led areas, the modernisation of banking must remain as an evolving journey. To find the right approach, UK banks must ask themselves: what does the digital operating model look like to make this constant innovation sustainable? For an incumbent bank, digital transformation has become a herculean task in an age saturated with technological options, requiring traditional lenders to embrace unpredictability, maintain agility and digitise to the core, which requires support from agile fintech players. Legacy players that are in the process of migrating to the cloud are struggling with application modernisation, data centralisation and security, and as a result, banks that are born in the cloud are at an advantage. However, the cloud is not a solution in itself. From building agile platforms to meet the expectations of demanding customers, to crafting an optimised digital operating model, to instilling a strong work culture that goes beyond diversity, there are central challenges which must be addressed by banks in order to lay the foundations for a successful digital future. Banks now recognise the urgency of collaborating with the leading minds in the fintech industry, to craft and deliver the best products to their discerning customers. Download your copy of the report, in association with Backbase, to gain valuable insights from leading financial institutions and understand what will make UK banks successful into the future. The report includes insights from Atom bank, Coventry Building Society, first direct, HSBC, Investec, Lloyds Banking Group, Nationwide, NatWest, OakNorth, Standard Chartered, Tandem Bank, and Yorkshire Building Society. Additionally, join us for a Finextra webinar with Backbase, to gain insights from an industry expert panel discussion on how a future-proof digital banking operating model can reconcile digital and personal - Engagement Banking: Orchestrating the Customer Experience

21 May 2021 881 downloads

Report

Five Business Benefits for Analysing and Combatting Fraud

A Finextra Research Impact Study in association with Aerospike. With increased financing options at point-of-sale, card-not-present transactions, and contactless payments, comes a resultant surge in fraudulent transactions and financial crime. This increase in digital fraud has been catalysed by the recent Covid-19 pandemic-induced shift to online banking and commerce. Now more than ever, financial institutions must implement payments authentication processes to prevent the long-term risks associated with fraud, including slimming margins and reputational damage. One way financial players can stay ahead is to analyse all available historical and real-time data, and apply artificial intelligence (AI) and machine learning (ML) tools – which encompass a range of algorithmic approaches that derive from statistical methods such as regressions and neural networks – to decipher legitimate transactions from the illegitimate. There are, however, five further business benefits to understanding customer risk profiles. Actionable insights derived from fraud profile analysis can help banks visualise each customer, not as a collection of disassociated data points, but as a mosaic, made up of different characteristics that merge to provide a comprehensive view. This can lead to complex, holistic, and predictive analysis of customers’ behaviour – generating consistent and tailored services. Download your copy of the paper below to learn more.

20 May 2021 218 downloads

Report

The Cloud-native journey - Why Hybrid Cloud and Open Source go hand-in-hand

The financial services industry has been turning to cloud services and technology in droves to accommodate the pressures, security demands and cost savings of digital transformation projects, as well as regulatory compliance priorities. To become and remain agile, financial organisations must move beyond legacy practices, particularly when the speed of change in the industry is at such an all-time high and accelerating. Variants in cloud technology have quickly emerged leaving financial services organisations with choices far beyond mere public cloud solutions. Security and availability demands have led many institutions to continue to rely on private cloud deployments- those within the organisation’s security perimeter or firewall. While at the same time, managed cloud services and Software-as-a-Service options have increased the number of public clouds organisations are using. Other factors such as regulatory requirements mean financial services firms need to not only keep certain data within a certain geographical location but also should review the risk associated with relying on only a single cloud provider. Compounding the regulatory challenges, the advancements and innovations around 5G and IoT are leading to new levels of edge computing, with corresponding cloud requirements. As a result of this proliferation and the arising complexity from multiple clouds, as well as the need to have enterprise-wide management thereof, banks and FIs have needed to move away from a single cloud strategy and utilise a hybrid cloud and platform approach and a cloud-native mindset. From a business, security, risk and operational standpoint, the stakes have simply become too high not to be hybrid. Download your copy of this Finextra white paper, produced in association with Red Hat, to learn more.

19 April 2021 321 downloads

Report

Adapting to a shifting Cards Landscape

Identifying opportunities for Issuers. The payment cards industry has changed dramatically in recent years, with new technologies and regulations spurring innovation and lowering the barriers to entry for issuers. Meanwhile, there has been a shift to digital payments, which has created opportunities for bank and non-bank issuers alike. Card payment volumes have been growing, and the world’s standout region is Asia Pacific. China is the star performer, and the number of cards in issue is staggering. And while digital wallets such as Alipay and WeChat Pay have pushed the growth of mobile payments in China, cards have a key role to play. Similarly, in Africa, where mobile money services like mPesa have been hugely popular, there is still a role for payment cards in the rapidly developing markets. Cards are also in demand in other regions. In Europe, the most recent figures from the European Central Bank show an increase in the number of payment cards issued. So far, there has been a reported shift to digital payments in various markets, such as the Middle East, and even the least internet-savvy consumers have changed their spending habits and are now shopping online. In the physical world, contactless - both on smartphones and cards - has been successful in providing convenience for cardholders in stores. Additional innovations have attempted to make it even easier for customers to tap and go. Card programmes have become increasingly cost-effective, especially for issuers who are unencumbered by legacy systems. With on-demand digital printing, for example, cards can be personalised and issuers can order a smaller print run for smaller customer segments as they are needed – such as fans of a football club – rather than committing to a large batch upfront. Download your copy of this Finextra white paper, produced in association with FIS, to learn more.

14 April 2021 626 downloads

Report

The Future of Cloud 2021

Evolving the Financial Services Industry. As consumers have come to expect the same experience of their financial services providers that they have elsewhere in their lives, traditional financial institutions (FIs) are increasingly looking for ways to improve customer service and deepen engagement. For many, optimising the digital experience for customers is a priority. From leveraging omni-channel communication strategies to creating more personalised experiences, the goal is to deliver the right message, at the right time, in the right channel. Fintech firms have been faster to innovate. Many, in fact, were created to address consumer dissatisfaction with traditional financial services providers. However, many players across the banking, payments and capital markets industries such as Barclays, Broadridge, Capgemini, Calypso, Collibra, DBS, FICO, Fraud.net, Global Payments, HSBC, IHS Markit, Kx, Mambu, Nasdaq, Numerix, OakNorth, Singapore Exchange, Solarisbank, Standard Chartered and Trading Technologies are increasingly turning to the cloud as a way to accelerate their digital transformation for customers. Shifting away from legacy infrastructure reduces time and resource constraints and financial institutions can innovate and respond to customer needs with the cloud. Banks, payments services providers, and capital markets firms must take advantage of the cloud’s greater elasticity, flexibility and cost-effectiveness. Download your copy of the report below to learn more. Part of the Finextra Cloud Series, in association with Amazon Web Services (AWS).

26 March 2021 850 downloads

Report

Cut through the noise: 5 key considerations when selecting your payments platform

A Finextra Research Impact Study in Association with Compass Plus. Identifying and working alongside technology vendors has never been higher on the agenda. A 2020 Lloyds Bank survey found that 88% of senior leaders within financial institutions say that tech investment will be a top strategic priority for the next 12 months, and that 62% plan to increase investment in technology and core systems. Organisations across the payments industry are facing unparalleled pressure to digitally evolve. For incumbents this is a result of everchanging customer expectations and demand for digital. These factors cause financial institutions (FIs) to look to the crowded market of technology vendors to help future-proof their business. Vendors trying to differentiate themselves in this crowded market often use convoluted tech-spin to try and attract new clients. This can make it difficult for FIs to identify which vendor, platform or service is best suited to their needs and may end up being led in the wrong direction. While FIs are facing immense pressure to evolve quickly, selecting the right vendor is a process which should not be rushed into. Financial institutions must be cautious when considering potential technology vendors by cutting through marketing vernacular to build a clear understanding of the platform’s capabilities. This impact study sets out the key considerations FIs must make to effectively deploy their strategy. From avoiding outdated assumptions, outlining clear objectives, steering clear of industry buzzwords, to asking the right questions, these fundamental tools will only assist financial organisations in their journey to enhance or transform their digital offering. Download your copy of the paper below to learn more.

09 March 2021 489 downloads

Report

Liquidity and Beyond: Building a future through certainty

Creating a strategic advantage. There is an evolving approach to liquidity management: from merely monitoring, to actively managing and optimising, to using liquidity for a strategic advantage. Achieving this requires the right tools and technology, and also an open mind about the opportunities that effective real time liquidity management can bring. Seconds, minutes or hours – whatever the definition of ‘real time’ in real time liquidity management, its speed is definitely increasing. Banks and corporates are operating in an increasingly dynamic environment: consumers want services on-demand; payments are faster; information travels at warp speed, news is rolling 24/7; and crises can unfold in an instant. This always-on environment has an impact on liquidity, which has to be managed effectively to ensure an organisation can meet its obligations; in times of stress, it can be critical for its survival. Having the right information at their fingertips – in real time – gives bank and corporate treasurers accuracy and assurance in navigating this changing environment. And if liquidity management is done well, they will do more than keep pace with their environment – they will use it to their advantage. The right analysis of information in real time brings better understanding of their customer, their business, the potential to reduce costs and hence, greater potential for planning and growth based on new levels of certainty. The possibilities and potential that the business concept of real time can bring, in conjunction with up-to-the-minute use of advanced technology, is staggering. Businesses and banks were not built to operate in a 24/7 environment, and it is no mean feat to step up to the plate to meet this challenge and turn it into potential. Real time automatic payments, settlement, account updates, exception handling and data sharing can eliminate the need for cash buffers- idle cash becomes investment. Real time can bolster banks’ credit ratings; real time analysis predicts behaviours leading to reduced risk; real time can provide instant forecasting adjustments- further finetuning an organisation’s position. It feeds a 360 view on a client, fostering better relationships, and with agile systems, enables a firm to plan and grow with a certainty hitherto never seen. Now is the time for banks and corporates to act, redefining their business goals, and crucially, their technology requirements. Download your copy of this Finextra white paper, produced in association with Montran, to learn more. Read the associated Industry Spotlight here - Real Time Intraday Liquidity Management.

17 December 2020 426 downloads

Report

Managing Compliance and Growth

For banks large and small there is no question about the sheer volume of transformation pressure currently at play. Regulatory changes on the increase, various migration deadlines to implement amid the general shift to real time means that mere survival in itself can seem like a win. More is required of organisations who want to differentiate and compete for and retain the customer’s attention. When risk awareness plays a crucial role how can banks start to carve a safe and secure route to innovation at a speed which meets market demand for new and intuitive services? For smaller and newer organisations, arguably it is easier when they don’t have legacy constraints and are more attuned to the benefits and possibilities of emerging technologies. But as they strive to diversify and grow their volumes, they are often blindsided by the associated risk and indeed the threat of suffocating a start-up culture. Becoming consumed by the here and now and not being able to see the woods for the trees is an all-too-familiar theme for many medium-sized banks. Being able to establish and refine their own agile way of working so they can learn fast and grow fast is key. But when one size does not fit all in terms of scaling projects, it becomes very difficult to take the reins on their own unique journey of growth. This research paper by Finextra, produced in association with Finastra, is based on several interviews with small and medium-sized banks, garnering their perspectives and experiences in their efforts to grow and scale while managing compliance and all that goes with it. Download your copy of the Finextra industry sentiment report to learn more.

14 December 2020 354 downloads

Report

Automation, Resiliency and Agility: Key Drivers of Cloud Adoption and Strategy

A Finextra Research Impact Study in Association with Calypso Technology and Amazon Web Services (AWS). Cloud adoption for financial services firms has been on the rise over the past few years - a trend that has been further bolstered by the wave of digitisation brought on by the global pandemic. A survey of financial services firms’ cloud attitudes conducted by bobsguide in 2020 revealed that nearly 83% of participants were already working on the cloud, with 50% expanding their use and the rest of the respondents having already completed their cloud migration. Financial institutions in the global capital markets space are facing unprecedented regulatory scrutiny, IT rationalisation, and cost pressures while still having to deliver value to their clients, which has shifted the spotlight on cloud from innovative or experimental initiatives to mission-critical workloads that can be made leaner and less expensive to maintain. While cloud has become a common mode of delivery for innovative capital markets firms, recent financial pressure, global macro-economic uncertainty and the need to respond to regulatory change has led to cloud adoption and migration being integrated and considered a crucial part of a financial institution’s business strategy in optimising mission-critical workloads with cloud technology. In this impact study, we discuss the key drivers of cloud adoption, as well as strategies that ensure successful outcomes for customers who want to make the move to cloud. Download your copy of the Impact Study below to learn more.

11 December 2020 390 downloads

Report

The Future of Core Banking 2020

The Catalysts Driving the Smart Finance Evolution. Core banking continues to rank among the top technology investment concerns in banks. However, there is a fundamental mismatch between expectations based on real-time consumer experiences and a bank’s ability to serve those experiences front to back. There is no shortage of effort by banks to broach this gap and shore up the end-to-end consumer experience with emerging technologies, but the realisation that core banking infrastructure may not be up to the task is a bitter and expensive pill to swallow. Especially for the more traditional, legacy institutions. While this is nothing new, pressures brought about by Covid-19 have served to exacerbate structural weaknesses as banks have scrambled to deliver and outperform in a purely digital manner. The cost of expediting these projects is substantial, to say the least, yet when presented with few other options, banks overwhelmingly accept as they appreciate the speed at which digital newcomers will happily step into their shoes. The realisation that investment in resilient, powerful core banking systems will improve banks long into the future certainly softens the financial blow. Greenfield banks, for instance, are curating the architecture they are investing in now to ensure that they remain in step with the pace of change 10 to 15 years down the line. The ease with which these digital banks are operating and expanding across diverse markets also informs how more traditional players can approach banking into the future. Yet, even the most sophisticated technology requires smooth implementation in order to profit from its offering – this means nurturing and honing DevOps agility is equally fundamental to both resilient core banking infrastructure and client satisfaction. These opportunities present institutions with the proposition: replatform, refactor, augment or replace. The age-old dilemma is no longer painted with a brush of scepticism as banks increasingly see the value in collaborating with third parties to increase their product offering and view modularised systems as a keystone for ongoing innovation. To deliver the full potential of this technology, the way core banking interacts with data remains an ongoing concern for banks which are being pulled in opposing directions by the need to both innovate and remain compliant. This challenge weighs on latent revenue streams and institutions are carefully considering whether monetising data resources can be achieved without compromising customer rights and privacy regulations. Optimistically, however, banks are entrenching already established sustainability strategies with data-focused technology to deliver more ambitious carbon reduction objectives. Engaging with leading financial institutions across the globe, this report grapples with the subjects that are front of mind for banks of all shapes and sizes as they face the unprecedented pressure of a pandemic coupled with meeting the breakneck pace of financial technology advancement. This report by Finextra, in association with Red Hat and Temenos, explores the limitless opportunities firms hold to enhance and build upon their core banking infrastructure and gathers the views of several experts from Alba Bank, BBVA, CaixaBank, Commerzbank, Crown Agents Bank, ING, Investec, OpenBank, Sberbank, Société Générale, Standard Chartered, and Varo Bank. Download your copy of the report below now to find out more.

09 December 2020 1298 downloads

Report

Charting a Core Transformation Roadmap to a Future Unknown

The bulk of critical and sensitive data are kept in a bank's core. Today's core needs to process and operate in real time, and support multiple digital channels. There are different routes and many factors that need to be considered, such as budget, workforce skills, and huge cultural change in terms of new working methodology and enterprise-wide buy-in. Where the firm wants to focus its goals in the new digital world it inhabits, and on what core tenets it wishes to compete inform the transformation decisions the bank makes. Finextra interviewed several industry leaders on the subject of core transformation and what it takes to build a future-proof bank, discussing the approach to change and the management thereof, the use and deployment of new technology and cloud services, how strategic partnerships can play the most valuable part, and crucially, how to deconstruct and rebuild a business while answering the demands of real-time digital client services and a yet-to-be-determined future. Download the full report below to find out more.

24 June 2020 979 downloads

Report

Wealth Management: Driving Transformation through a 360° Client Lens

A 360 degree customer view is fast becoming essential for financial organisations and wealth managers to compete and win in the digital economy – but integrating the vast and changing data sources is often a major challenge. In recent years, advances in technology, as well as global digitalisation, have ushered in new capabilities for banks, enabling them to understand their clientele better and, hence, serve them in a more efficient and tailored fashion. The customer 360 view has become a familiar term as organisations utilise increased data analysis to capture holistically customer behaviour and account patterns leading to more intuitive offerings and responses, stronger security and faster processes. It is the ‘who, what, why, when and where’ of customer lifecycle management. Wealth management, hitherto later to the digital party than other financial services segments, is recognising the benefits to be gleaned from data-led transformation – both those operating independently and those part of larger banks. Growth, leaner operating functions, easier compliance processes and cost savings are just some of the benefits to be had. Cloud is called upon to deliver new and differentiated service levels and organisations are increasingly looking for new and scarce skillsets. This Finextra paper, produced in association with MarkLogic, is based on several discussions with senior financial services and wealth management experts covering key business and technical drivers for creating the need for a 360 degree customer view, the challenges to be overcome in the process and the long-term benefits to be gleaned as a result. Download the full report below to find out more.

18 June 2020 558 downloads