2023

When adopting new payment methodologies, banks must strike a challenging balance between ease of use and access and the need to put in place stringent levels of security.  With technology evolving at ever-increasing rates, it’s increasingly difficult to keep on top of that challenge.

Banks first need to put in place an expert team with the time, resource and capability to stay ahead of the technological curve. This includes reviewing, and, where relevant, leveraging the security used on other systems and devices that support access into banking systems.  Such a team will, for example, need to look at the latest apps and smartphone devices, where fingerprint authentication is now the norm and rapidly giving way to the latest facial recognition functionality.

Indeed, it is likely that future authentication techniques used on state-of-the-art mobile devices will drive ease-of-use further, again without compromising security, while individual apps are increasingly able to make seamless use of that main device functionality.

This opens up great potential for banks to start working closely with software companies to develop their own capabilities that leverage these types of security checks.  If they focus on a partnership-driven approach, banks will be better able to make active use of biometric and multifactor authentication controls, effectively provided by the leading consumer technology companies that are investing billions in latest, greatest smartphones.

Opportunities for Corporate Cards

This struggle to find a balance between security and convenience is, however, not just about how the banks interact directly with their retail customers. We are witnessing it increasingly impacting the wider banking ecosystem, including across the commercial banking sector. The ability for business users to strike a better balance between convenience and security in the way they use bank-provided corporate cards is a case in point.

We have already seen that consumer payment methods using biometric authentication are becoming increasingly mainstream – and that provides an opportunity for banks.  Extending this functionality into the corporate card arena has the potential to make the commercial payments process more seamless and secure. Mobile wallets, sometimes known as e-wallets, that defer to the individual’s personal attributes to make secure payments on these cards, whether authenticated by phone or by selfie, offer one route forward. There are still challenges ahead before the above becomes a commercial reality though.

First, these wallets currently relate largely to in-person, point of sale payments. For larger, corporate card use cases such as settling invoices in the thousands, the most common medium remains online or over the phone.

Second, there are issues around tethering the card both to the employee’s phone and the employee. The 2016 Gartner Personal Technologies Study, which polled 9,592 respondents in the U.S., the U.K. and Australia revealed that most smartphones used in the workplace were personally owned devices.  Only 23 percent of employees surveyed were given corporate-issued smartphones.

Building bridges

Yet the benefits of e-wallet-based cards in terms of convenience and speed and ease of use, and the potential that they give the businesses offering them to establish competitive edge are such that they have great future potential.

One approach is to build a bridge to the fully e-wallet based card:  a hybrid solution that serves to meet a current market need and effectively paves the way for these kinds of cards to become ubiquitous.  There are grounds for optimism here with innovations continuing to emerge bringing us closer to the elusive convenience/security balance. MasterCard has been trialling a convenient yet secure alternative to the biometric phone option. From 2018, it expects to be able to issue standard-sized credit cards with the thumbprint scanner embedded in the card itself. The card, being thus separated from the user’s personal equipment, can remain in the business domain. There is also the opportunity to scan several fingerprints to the same card so businesses don’t need to issue multiple cards.

Of course, part of value of bringing cards into the wallet environment is ultimately the ability to replace plastic with virtual cards.  The e-wallet is both a natural step away from physical plastic and another example of the delicate balancing act between consumerisation of technology and security impacting banking and the commercial payments sector today. There are clearly challenges ahead both for banks and their commercial customers in striking the right balance but with technology continuing to advance, e-wallets being a case in point, and the financial sector showing a growing focus on these areas, we are getting ever closer to equilibrium.

by Russell Bennett, chief technology officer, Fraedom

The past five years has seen an incredible rise in awareness around bribery and corruption in both the public and private sectors. While bribery and corruption detection has typically been the purview of whistle-blowers in the finance and audit areas of organisations – the era of whistle-blowers as the only ones exposing these issues is ending. Advanced analytics and other technology processes are lending support to the complicated challenge of following payments and other indicators of corruption.

Since the passage of the UKBA and other updated legislation in nearly 60-plus countries, the world has seen FIFA, Petrobras, Samsung, Shell, Rolls Royce, Unaoil, Embraer, Pfizer, and other organizations exposed for “back room” and other deals to secure multi-million and even billion dollar contracts. In 2017 alone, two companies, Odebrecht and JBS SA have both been fined over $3B a piece for bribes. What does this history of corporate malfeasance mean for the audit function at an organization?

The Audit function, both internal and external, has often been the unsung hero in the identification, investigation and subsequent alerting for many anti-bribery and corruption cases. The primary challenge that audit faces is the complex task of finding these schemes manually. This is where analytics and specialised technology can help significantly.

So how can analytics help the auditor work faster and more accurately? There are three main areas that provide benefits to the audit process:

• Integrating Automation: Auditors primarily rely on their experiences to identify potential ABC issues. With the use of analytics, an organization can depend on sophisticated algorithms to detect potential problem areas by continually looking for schemes within a company’s books.
• Staying Up-to-date: Criminals are always looking for new ways to push their money through the system. Analytics can learn to look for shifting patterns of unusual behaviour by a company’s vendors, customers and even employees and raise an alert to auditors before a problem may have even started.
• Gathering Evidence: Auditors spend significant amounts of time gathering evidence to support a case.  Analytics can significantly reduce this effort by providing continuous monitoring of transactions and quickly bringing back linked transactions related to the case.

Analytics is now viewed as a complimentary tool to an auditor’s function by reducing the time spent identifying problems, and by providing better quality alerts and cases back.

Micah Willbrand

Global head of anti-bribery and corruption solutions

Nice Actimize

Time was when the local bank manager was a pillar of the local community, a figure of solemn solidity; trusted by his customers and potentially known to them all by name. Today, the image of the traditional bank manager seems almost as outdated as that of the village blacksmith. We live in an era of virtual shops, virtual friendships – and even virtual banks. What place has the bank manager in the digital age?

Not much, if banks themselves are to be believed. Earlier this year, Avanade released its latest report into digital disruption in the banking sector, which polled senior IT decision makers from across Europe. The poll found that almost three fifths (59%) plan to eliminate human interaction from banking service in the next 10 years.

Doubtless, some customers will see this as a long-overdue development, used as they are to a new generation of banking services delivered entirely online or through apps. Others may welcome the elimination of lengthy queues in the branch, or the lost lunch breaks spent trying to get through to a customer services representative.

Certainly, a host of digital startups and challenger institutions have begun to revolutionise our relationships with financial services providers, showing that day-to-day banking can be conducted quickly and conveniently through a digital interface. Three-quarters of respondents to our research state that their organisation is concerned about the impact that disruptive competition such as fintech start-ups are going to have on the banking sector.

Improving the customer experience with technology

As these ‘disruptors’ become popular, established banks are scrambling to reinvent themselves. Nine in ten of our respondents say they are investigating how they can use technology to improve the customer experience – an area where traditional banks admit they have fallen far behind their digital-first competitors.

As the banks embrace technology and seek to imitate their online-only and app-based rivals, it’s natural that the traditional bank branch – and the staff within – will become a thing of the past, their solid stone facades providing a perfect setting for a new clutch of trendy wine bars. Just over a quarter of senior IT decision makers from Europe say that an increased focus on digital-centric customer relationships will “inevitably” lead to the closure of some or all branches.

Is the decline of the high street bank and its manager something to be lamented? The banks will point to the immense popularity of digital financial services, and point out that eliminating the cost of maintaining a nationwide branch network can be passed on as savings to customers.

Sleepwalking towards disaster

Or is the banking sector sleepwalking towards a future where they risk sacrificing one of the few remaining unique selling points they have over their digital challengers, and merely attempting to copy what other fintech companies are already on their way to perfecting? Is it wise for them to eliminate the human touch entirely from their operations?

There are two compelling reasons why established banks should think carefully about how they can learn from the new wave of digital upstarts. The first relates to their ability to provide the same slick functionality and reliability for their digital services. Traditional retail banks are based on technology stacks that have been augmented and updated over years, yet still contain a vast amount of legacy systems that are completely unsuited to developing, testing and deploying at speed.

Of course, banks are beginning to realise that they need to replace legacy infrastructure and embrace new technologies such as the cloud. But this process will take some considerable time, during which the fintech challengers will forge further ahead with more sophisticated services, stealing, even more, market share along the way.

The second reason is that physical branches and trained, knowledgeable staff represent a unique and valuable asset – one which banks should think very carefully of consigning to the history books. In spite of the popularity of app-based services, there are some transactions that rely on human interaction – one could even say, on human relationships.

But what is the direction of travel?

Complex, high-value or long-term financial products such as loans, mortgages and investments are obvious areas where humans can make a real difference: for example, by recommending different products, discussing risks and rewards, or even just providing a commiserating explanation for why a customer has been turned down for a loan or credit card.

No-one would claim that banks don’t need to invest in new technology so that they can develop new, more relevant services for their customers. Rather, it is the direction of travel that banks need to examine. Will they profit more from slavishly copying the fintech startups or, what seems more likely, will they do better to reinvent the way they communicate with customers while retaining, where possible, the human touch?

The traditional image of the bank manager might be a thing of the past, but could there be a place for a successor – one armed with an iPad with which to talk customers through their financial future? It makes sense – in fact, you can almost certainly bank on it.

By Paul Bowen, Banking Lead, Avanade

The retail banking landscape is becoming increasingly crowded with new offerings from ambitious fintech companies and, increasingly, the Silicon Valley tech giants like Amazon, Facebook and Apple. These players are gaining a growing share of the space between traditional banks and their customers, meaning that banks are now competing with a league of new players.

The British Bankers Association forecasts that by 2020, customers will use their mobile to manage their current account a total of 2.3 billion times a year; more than internet, branch and telephone banking put together.

So, how can retail banks stay competitive? Can they actually learn from the fintech, big tech and social media pioneers that are threatening their central standing as the number one go-to provider of financial services? Could they actually go on to beat them at their own game when it comes to digital customer engagement through banking apps?

The simple answer is, yes. Even despite the fact that competition in the market will intensify once PSD2 comes into force in 2018. The forthcoming regulation will further enable non-banking, data-rich giants like Google and Facebook – as well as innovative fintechs and developers – to lure customers to their own sophisticated and engaging financial management and payment services apps using data from their traditional bank competitors. However, banks still have the competitive edge when it comes to access to customers’ (and financial) data at scale, which they can use to enrich the engagement experience in digital banking.

That said, banks must move swiftly in order to exploit this advantage, while ensuring that they focus on doing so in a sustainable way. To drive long term meaningful engagement with customers, the emphasis must be on using data to enhance user experience. For most banks, this means investing in enriching transaction and financial product data that will enable them to customise their engagement with users. Customers need to feel like their bank understands them and encourages them to form habits that drive real value and impact. They also want to feel that the time they pass on a banking app is time well spent.

In addition to providing a clear and insightful overview of customers personal finances and more advanced features there are many other interesting ways to keep your customers more engaged:

• Proactively feeding insights that inform and educate: this could be in the form of recommending a product or giving financial advice that is relevant to a user.
• The motivation of a card-linked offer – a type of personalised digital coupon via a third party that customers opt in through their bank, which then allows them to earn instant rewards – is an effective way of encouraging users to make small savings on a day-to-day basis.
• Enabling community reinforcement by encouraging users to share progress with peers can also be a helpful way to gamify their saving efforts.

In a post-PSD2 world, banks will no longer be able to rely on the inertia of lifelong customers. 73% of millennials say they are more interested in new financial services offerings from the likes of Amazon and Apple than a traditional bank, so it is essential that banks aim to foster long-term relationships with their customers via their digital platforms. In our lives we have a few critical moments when dealing with money. Our first job, first line of credit, renting and perhaps buying our own place, first child and then maybe investments and considerations for a comfortable retirement. Long-term retention is not just about frequent engagement, but about building up trust and being there for customers with the right advice at the right time in a person’s life, such as:

• Guidance on budgeting during university
• Advice on pensions and savings after securing a first job
• Recommendation or insight that renting can be expensive and perhaps it could make sense to look at buying an apartment in the future

If a bank can show its customers that it knows them well and earn their trust, they’ll be more likely to win customers’ loyalty in the long run.

Personalisation of every customers’ banking experience is tied closely to this idea. Everyone has a different relationship with their finances, yet most banking apps look more or less the same. A bank should provide a digital environment that caters to an individual’s needs and shows them that it understands them. Banking apps should serve different financial behaviours – from those who are more conscientious and “good” with money, to those have lower measures of impulse control and tend to struggle with getting to grips with their finances – and help them develop better financial habits no matter what their personality type.

The countdown to PSD2 is on, and so is the race to meaningfully engage with users between traditional retail banks and their technology rivals. The bank that can offer a data-driven, personalised digital environment that helps people gain the most valuable insight into their current financial situation and motivate them to improve it through a seamless user experience, will be the provider that wins ongoing loyalty from its customers.

The best banking apps should provide a digital environment for continuous dialogue with its customers, that goes beyond the transactional to the emotional. Financially stronger customers will be happier customers, which will, in turn, keep your bank top-of-mind when it comes to other financial services that a customer might need. Get meaningful engagement with customers right, and it might just be the silver bullet for banks when it comes to keeping the big tech challengers at bay.

Bragi Fjalldal,

CMO, VP for Product and Business Development

Meniga

Outsourcing KYC is a good way for banks to safeguard their continued regulatory compliance and control spiralling costs, explains Toby Tiala, Programme Director, Equiniti KYC Solutions

In a bid to combat money laundering, market manipulation and even terror funding, the rising tide of conduct-based regulations continues to challenge banks globally. The cost of compliance – and non-compliance – is steep. The average bank spends over £40m a year on Know Your Customer (KYC) processes yet, in 2016 alone, bank fines worldwide rose by 68%, to a staggering $42bn.[1]

A double squeeze

Resource stretched mid-sized banks, in particular, are having a tough time. As regulators up the ante they are creating an operating environment increasingly conducive to fines. To cope, banks are expanding their compliance resources to mitigate their risk of transgression. Those with resource limitations are, therefore, the most vulnerable.

They are right to be worried. Since 2008, banks globally have paid a staggering $321bn in fines. Earlier in the decade, high profile money laundering and market manipulation cases caused the level of overall fines to skyrocket. After a brief period of respite (when governments and the Financial Conduct Authority backed off fearing industry suffocation), the fines have been steadily creeping back up. This time, however, big-ticket fines have been replaced by a far higher number of smaller penalties. Put another way, the regulators are now tightening a much finer net than before.

A bank’s ability to profile and identify risky customers and conduct enhanced due diligence (EDD) is critical to ensuring compliance with anti-money laundering (AML) law. This is no trivial task. Major banks are ploughing expertise into their KYC and creating proprietary systems dedicated to meeting the new requirements. Mid-sized banks, however, don’t have this luxury and are challenged by the need to beef up their resources. Applying regulations like AML4, PSD2 and MiFID II to complex legal entities like corporates and trusts is a convoluted business.

New focus

A large proportion of regulatory fines result from high-risk customers slipping through the cracks, usually stemming from ineffective beneficial ownership analysis, customer risk rating or EDD. This is especially common in complex entities with numerous ‘beneficial owners’ – something that has brought these individuals into sharp focus. A beneficial owner in respect of a company is the person or persons who ultimately own or control the corporate entity, directly or indirectly. Conducting KYC to effectively identify high-risk beneficial owners of complex entities is skilled and complicated work, to say the least.

Nowhere can the new focus on beneficial ownership be seen more clearly than in the EU AML4 Directive, which recently came into force, in June 2017. This directive is designed to expose companies with connections to money laundering or terrorism, and decrees that EU member states create and maintain a national register of beneficial owners.

Big impact

The growing focus on beneficial ownership is having a clear impact on banks’ relationships with their trade customers. According to research from the International Chamber of Commerce,[2]  40% of banks globally are actively terminating customer relationships due to the increasing cost or complexity of compliance. What’s more, over 60% report that their trade customers are voluntarily terminating their bank relationships for the same reason. That this could be evidence of the regulations working will be of little comfort to banks that are haemorrhaging revenue as a result.

The UK has already formed its beneficial owners register but caution is advised. The data quality still has room for improvement and the regulations make it clear that sole reliance on any single register may not translate into effective AML controls.  Mistakes – genuine or otherwise – may still occur but automatically checking these new beneficial ownership registers is a clear step forward.

The key for mid-size banks is to zero in on what will both enhance their KYC procedures and deliver clear and rapid visibility of high risk entities. Once established, this will enable them to manage their own risk profile, together with their customer relationships, and minimize the negative impact on their revenues.

Highly complex KYC and EDD activity can severely inhibit the onboarding process for new customers, often causing them to look elsewhere. The deepening of these procedures is making matters worse – it can now take up to two-months to onboard a new client according to Thompson Reuters[3], with complex entities usually taking the most time. Large banks have proprietary systems to accelerate this process but, for mid-sized banks, this is a serious headache; not only does it extend their time-to-revenue from corporate clients, it can also turn them away entirely, and lead them straight into the hands of their larger competitors.

Combine and conquer

For these banks, outsourcing their KYC to a dedicated specialist partner is a compelling solution. These partners have agile, tried and tested KYC systems already in place, are perpetually responsive to the changing regulatory requirements and have highly skilled personnel dedicated to navigating the KYC and EDD challenge in the shortest time possible. Plugging into a KYC-as-a-Service partner enables mid-size banks to seriously punch above their weight, by accelerating their onboarding of new clients to match (and often beat) the capabilities of large banks, dramatically reducing their overall compliance costs and helping them get ahead – and stay ahead – of the constantly shifting regulatory landscape. This, in turn, releases internal resources that can be redirected in support of the bank’s core revenue drivers and day-to-day business management.

It is clear that the regulatory squeeze is set to continue for the foreseeable future. Banks that have the vision and wherewithal to accept this notion and take positive steps to reorganise internally will not only be able to defend their ground against larger competitors, they may even turn KYC into a competitive differentiator.

Specialist outsourcing is fast becoming the norm for a wide variety of core banking processes. Few, however, are able to demonstrate as rapid and tangible benefit as the outsourcing of KYC.

Cybercrime is an ever-increasing risk for financial institutions. While the wealth management industry has thus far been less affected by major breaches than other sectors, wealth managers should be arming themselves with the right tools in the fight against hackers.

A DDoS attack is one of the biggest cyber threats currently faced by fintech companies. This ‘distributed denial of service’ occurs when cybercriminals flood a website with traffic in order to overwhelm it and shut down services. The very nature of their business makes financial institutions an obvious target for hackers; attacks are relatively easy to launch and smaller companies’ systems can be overwhelmed by them.

The motives for these attacks can vary but might include demanding a ransom in return for stopping the attack, or as a diversion to tie up security staff while hackers carry out a more significant assault. The good news for smaller companies is that, unlike their larger rivals, they are unhampered by cumbersome legacy systems. Agility, innovation and collaboration are key to combating cybercrime, and small firms can harness the power of cloud-based DDoS protection services.

It’s all down to your capacity

These services have a huge network capacity so they can filter out large amounts of DDoS traffic without being overwhelmed. This allows legitimate traffic from customers to get through without interruption. This can also be used to intercept scanning activity. ‘Scanning activity’ is used by hackers to attempt to scan a company’s computer systems by sending traffic to its network in the hope of finding software with known vulnerabilities that can be exploited.

Criminals may also try to gain access through social engineering. This often involves emailing or calling staff and tricking them into believing they are talking to a fellow employee. A workforce that isn’t sufficiently trained to know what to monitor for when it comes to phishing emails or other malicious tactics can leave its organisation very exposed.

While social engineering methods pose a major cybersecurity risk for any company, these malicious techniques are theoretically a greater threat to larger organisations with bigger workforces that are harder to train and monitor. Nonetheless, firms of every size and scale should have effective training and processes in place to help mitigate risks.

Combat the criminals

Increasingly sophisticated tools are available to combat the criminal on the street trying to log into, for example, a victim’s online banking or investment portal. A large number of financial services firms now use ‘panic password’ technology to protect their clients, whereby you can enter a special PIN code (i.e. not your actual password) if under duress, that will automatically notify your security teams that you are being coerced. Further to this, the app will appear to continue to work ‘normally’, leading the attacker to believe that they are able to steal funds and transfer them to a particular account.

Another way in which providers can protect clients is via two-factor authentication. Many large financial institutions require some extra information in addition to a password to log on to a service, often a one-time password or PIN that is sent to the customer’s phone via a text message or generated by an app on their smartphone. Other companies offer dedicated security tokens that generate a shortcode on a built-in screen.

Two-factor authentication provides better security than a password alone because even if a hacker can guess a user’s password, they can’t use it unless they have the smartphone or security token as well. This type of technology is relatively low cost, making it perfectly feasible for smaller fintech companies to implement. And in a world that is seeing an alarming rise in the size and scale of cyber attacks, firms must take every step possible to mitigate exposure.

Dmitry Tokarev

Chief Technology Officer, Dolfin

Everyone has a digital identity that represents you as a unique individual. But, says Dr Michael Gorriz, group chief information officer at Standard Chartered Bank, that which distinguishes you in the physical world is generally irrelevant to how you are identified in the digital one

The challenge for banks, technology firms and governments is how to make it easier and safer for people to identify themselves online while allowing them control over and giving consent for use of their digital identity (DI). These days, you are asked to create a new login when you apply for each new service, so you potentially have to log in your details a few times a day and remember multiple passwords. A universal DI for everything would make life much more convenient.

Passports, driving licences, birth certificates – documents that identify us in the physical world will no longer be necessary. A business trip or vacation would be a seamless experience, where passport control may no longer be required, and banking services will be a breeze because of robust and trustworthy KYC (know your customer) processes.

Some governments have taken the lead as part of their development of digital economies. With Singapore’s MyInfo one-stop database of personal data, citizens can apply for government services or open a bank account without filling in multiple forms or providing supporting documents. India’s Aadhaar project provides a unique ID to each citizen so they have access to healthcare services, education and government subsidies. It is a key driver of socio-economic development and ensures benefits directly reach unbanked pockets of the population.

The role of financial institutions

Banks need to give their customers a seamless and convenient experience. That is why Standard Chartered has participated in pioneering DI initiatives such as PayNow in Singapore which makes peer-to-peer payment easy as it only requires your national ID or mobile number. The development of a universal identity system needs robust processes to recognise and authenticate a person’s data. The system also has to work for myriad institutions with complex, interconnected operations across different geographies.

Financial institutions including banks have traditionally performed the role of custodians of data and have established cross-border operations, so are well-positioned to support the creation of DI systems. Banks are also incentivised to collect accurate data because the viability of their business depends on it.

New anti-money laundering directives and KYC rules mean regulators expect financial institutions to maintain high standards for identity verification of new and existing customers. To that end, Standard Chartered has started a proof of concept with fintech firm, KYC Chain, to improve our client onboarding process. The project, which uses blockchain technology, can recognise and verify identities of clients in a reliable way. Blockchain allows entities independent of one another to rely on the same shared, secure, auditable source of information.

Who owns the data?

Any universal identity system should allow the ownership of personal data to lie with the individual, who chooses what information to share to gain access to services. Bblockchain, the distributed-ledger technology behind the digital currency Bitcoin, has been seen as providing a potential technology solution.

With about half of the world connected to the internet, having a DI is in some quarters regarded as a fundamental human right, because proof of identity is required to gain access to a range of services. Achieving a universal DI would have many advantages but making it work would require cooperation among financial institutions, governments, technology companies and more. The benefits in terms of cost, time and user satisfaction are so great that we are optimistic a comprehensive and holistic solution may not be too far in the future.

The concept of cloud is now firmly established among corporate decision-makers. But, rewind ten years, and the mere mention of cloud would have been met with a furrowed brow. Times have changed, and for many, the adoption process went from never, to maybe, to we need it now.

This main catalyst is that today’s world needs a new approach. For companies trading in complex markets like commodities, price fluctuations, increasing regulation and geopolitical uncertainty are the new normal. Add in increasing operational intricacy and an explosion in structured and unstructured data volumes, and it’s clear that a technology that enables precise risk management, scalability and data-enriched transparency is a must.

For firms exposed to these markets, the possibility of cloud has largely been dictated by the availability – or, until now, the unavailability – of solutions that offer the rich functionality they need.

Now, a truly enterprise-level trading, treasury and risk management cloud solution exists. Breaking down the siloes between these functions will profoundly transform the way companies respond to customers, manage risks and run their business.

Robust, secure and flexible

A cloud solution means less hardware to manage, freedom for IT teams to focus on value-added projects and the ability to match operating costs with business demands in a much more agile way. It means a platform that’s built to address today’s security challenges, with cloud operations typically offering much more robust, expert security than on-premise installations.

But the transformation goes much deeper. With a cloud solution that combines exceptionally rich functionality with vast, almost unlimited, computing power and extreme flexibility, traders and risk management departments are empowered. For the first time, the infrastructure can scale to meet peak demand, and scale back again. Firms have the resources to complete analysis of and report on, previously unimaginable volumes of data, faster, to understand current VaR or P&L, without relying on an overnight run based on yesterday’s positions. They’re able to manage volatility in real-time. And they’re able to act on accurate real-time views of risk and take full advantage of the opportunities presented. Actions that were simply a pipe dream until recently.

A deeper transformation, not a pipe dream

From a finance perspective, cloud provides the springboard to shape how the business operates, by providing accurate data to the board to influence decision-making – data that has for too long been largely unavailable. This enables firms to develop strategies and carve out competitive advantages without being constrained by long lead times, or the costs and bureaucracy required to scale up their infrastructure and support capabilities. For the first time, chief financial officers (CFOs) can rely on the data they receive to get an accurate picture of cash flows and liquidity when it’s needed. Treasurers can shift their focus towards the annual capital allocation process, earnings and capital at risk. All of this makes it a far more strategic function.

Ultimately, the need for agility, scalability, security and flexibility will only be met through cloud deployments. In the near future, on-premise alternatives will struggle to deliver what a modern firm needs, and in a very short time, companies will have to search far and wide for reasons not to move to the Cloud.

By John E. O’Malley, CEO, Openlink, in conversation with Marco Scherer, Head of IT, Uniper

Sub-Saharan Africa is, today, the second fastest growing region in the world– and home to some of the most exciting emerging markets on the planet. These emerging markets, combined with frontier markets of equally great potential, “present a future cross-border trade and economic environment that could, one day, emulate Asia in diversity, opportunity and growth,” says Vinod Madhavan, Group Head of Trade for Standard Bank.

Efficient, effective and sustainable trade structures and technologies are central to achieving this vision for growth – and also for alleviating the poverty that still grips many parts of the continent.

Economically excluded populations can be rapidly included in meaningful economic participation by growing sustainable and inclusive domestic, regional and global trade value chains. Trade has the potential to drive inclusive growth in Africa by leveraging new technologies – especially in information – able to link sustainable African industries with a new generation of global consumers.

Now has never been a better time for Africa to sustain growth by taking charge of its own growth momentum, by rapidly expanding the continent’s internal and cross-border cash, trade and securities capabilities. This will, deepen local capital markets, enabling the development of sustainable, diversified and inclusive domestic economies through cross-border trade.

To achieve this vision, however, the information that Standard Bank has access to, across its 20 markets shows how important it is that legislators get the cross-border and policy basics right. At the same time, Africa’s financial institutions should look to developing the digital and sustainability solutions necessary to leverage the continent’s potential.

 Cross-border 

Cross-border integration (of production, supply and markets) through trade, drives the rationalisation of standards, the efficiency and growth of markets, and the diversification of economies – naturally.

Creating the financial markets that allow this evolution to happen is critical for Africa to successfully claim a greater share of global productivity – and the trade networks that support these.

 Progressive policy 

Africa will not, however, realise the benefits of regional and global trade without, at the minimum; liquidity, access to capital, progressive foreign exchange regimes, and clear tax systems. Being supported by; rational infrastructure, agile labour policies, relevant education and efficient customs and excise rules coordinated by regional trade bodies, will free Africa to expand growth internally – while continuing to attract foreign investment.

 Digitisation 

From a cash, trade and investment services perspective, Standard Bank is seeing a lot of evolution in digitisation being driven by our clients and their customer. As the various players in the client ecosystem – i.e., producers, suppliers, service providers – push the bank’s clients to adopt cheaper, more digital, technologies. The bank’s clients also expect the bank to be able to operate and deliver across these platforms.

Our clients continue to search for operational efficiency (especially in a largely paper intensive trade finance business) and hence we expect to see increased adoption of digitisation and digitalisation in trade (across the physical supply chain, the financial supply chain and the documents chain). Technologies such as Blockchain naturally lend themselves in realizing benefits from the digitisation of financial supply chain and documents chain (that secures the documents legal transferability while drastically reducing delays in couriering etc.).

Keeping close to clients, especially in Africa where mobile and other such digital solutions are evolving independently – and often ahead of the rest of the world, places Standard Bank in a position to observe these evolutions first hand – and then evolve solutions that support these digital needs.

Getting this right requires a culture without a territorial or parochial view of innovation and technology an innovative culture completely at home with the democratic and universal culture of today’s digital consumer, client, customer or business person.

 Sustainability 

Since the competitive management of trade information, in the modern age, includes end-users being aware of how sustainable products and services are developed and delivered, businesses also need to develop clear, transparent and fair procurement and production environments – that are sustainable over the long term says Mr Madhavan. While the growing importance of sustainability in business and trade is a challenge in many parts of the world, in Africa the shift to sustainability presents the continent with a myriad of opportunities to develop new, clean and efficient industries – from the ground up.

Standard Bank, as one of the two African banks signatory to the Equator Principles on sustainability in banking and finance, is acutely aware of the opportunity that the global sustainability movement offers Africa. Standard Bank is also the only Africa bank currently involved in the Sustainable Trade Finance working group constituted by ICC (International Chamber of Commerce, Banking Commission).

Getting sustainability right is likely to place Africa at the epicentre of a new global trade in sustainable products and services. This will have profound implications for growth and inclusiveness on the continent.

Standard Bank is ideally placed to help Africa achieve this vision by deploying its technological, policy, market and human insights – built up over 154 years and now present in 20 markets – in the development of a cross-border trade environment that drives inclusive growth and effective global competition in a rapidly changing global environment.

Vinod Madhavan, Group Head of Trade, Standard Bank