Saxo Bank Follows Its Own Advice To Specialize And Moves Ops To Azure
#Saxo offers access to global capital markets through a platform that investors and investment managers can access through an API.
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What’s Holding Up Realtime Payments?
EXCLUSIVE – By 2020 The Clearing House (TCH) is expecting all #banks and credit unions in the U.S. to be live with #realtime #payments (RTP). Many major banks are already in the midst of the process, TCH’s Realtime Payments Product Lead, Steve Ledford, told Bank Innovation. But as of right now, only seven banks are […]
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Barclays Partners with PayPal
One of the U.K.’s largest #banks, #Barclays plc, has partnered with American payments company #PayPal to provide Barclays customers the ability to use their Barclays products in PayPal&8217;s digital wallet to make online payments. The partnership will also allow U.S. consumers to redeem Barclays reward points at merchants accepting PayPal. Another important aspect of this […]
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Elevate Provides Safe Credit To People Banks Can’t Serve With FICO
Elevates AI and machine learning make it possible to lend safely to subprime borrowers and help them build a #credit history. It lends directly or through #banks which are taking a new look at this market as regulators reduce restrictions.
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Will fintechs dominate the cross-border payments market?
Domestic #payments have undergone a complete transformation in recent years and cross-border payments have started to move in this direction. Traditionally, cross-border payments have been subject to various challenges—long and uncertain funds transfer timings, lack of cost transparency and high transfer and conversion costs. Correspondent #banks have cut-off times and deadlines for same-day processing after which payments are processed the next day, so at the point of initiation, exchange rates remain unknown.
Transaction fees might also be deducted from the principal amount, so the beneficiary remains uncertain about the amount which will be credited. Payments need to be routed through many banks before they reach their destination, causing delays and accruing fees. Also, financial institutions have had to devote considerable headcount and efforts to manage liquidity and foreign exchange (FX) risk and to respond to customer enquiries, track status and investigate exceptions.
These long-standing inefficiencies have afforded the opportunities for players including #fintechs to provide innovative and customer-centric services in the #market. UK-based #fintech TransferWise has devised a peer-to-peer solution for money transfer (see Figure 1). Using a matching model where money is redirected to another recipient of an equivalent transfer in the opposite direction, the company avoids costly currency conversion and cross-border fees. This also allows TransferWise to charge between 0.5 and 2.5 percent in fees depending on the currency. Because of this cost benefit, close to two million people use TransferWise to transfer approximately £1 billion from 42 countries each month.
Figure 1 | Peer-to-peer cross-border money transfer model. Click to view larger. Another FX start-up, Revolut, provides an application that can convert or send money, as well as help users pay for products and services around the world or online. It is like creating a virtual bank account in three different currencies: USD, EUR and GBP. For minimal fees, users can top up their accounts in any of the currencies using a debit or credit card or via bank transfer. Currently, Revolut has nearly one million customers, acquiring 3,000 to 3,500 users every day.
SaxoPayments’s Banking Circle provides opportunities to fintechs, acquirers and payment service providers (PSPs) to offer their merchants the facility to perform immediate cross-border bank transfers and set up local settlement accounts worldwide for their customers quickly and at very low cost. Visa has also come up with a cross-border B2B payments solution called Visa B2B Connect, which uses distributed ledger #technology and leverages Visa’s existing global network of 15,000 financial institutions to create a private permissioned network. It offers speed and visibility of the payment from origination to the receiving end. Other fintechs like CurrencyFair, WorldRemit, Traxpay have also built cost-effective cross-border payment solutions and are rapidly gaining market share from traditional money transfer providers.
However, traditional money transfer providers such as banks cannot afford to keep losing market share to fintechs and new, emerging banking players. The cross-border payments market constitutes a very large portion of payments revenues (close to US$ 24 trillion per year) and is growing more as boundaries disappear for e-commerce.
Banks such as Santander and Fidor have partnered with Ripple to offer a #blockchain-based payment network that can complete cross-border transactions in a matter of seconds. Instead of using fixed correspondents, Ripple implements an automated instant auction for liquidity provision and FX to ensure the best price execution, removing liquidity and settlement risk from the process. Ripple has been able to combine payments messaging with funds settlement, which was previously unavailable for cross-border payments (where messaging is typically separate from the operation of the nostro and vostro accounts used for settlement). Ripple allows customers to keep their money with banks or other financial institutions as opposed to new start-ups and fintechs.
In parallel, the existing cross-border messaging network SWIFT has also launched its new network Global Payments Innovation (GPI). This new solution combines real-time payments tracking and the certainty of same-day settlement for its network banks. It introduces a unique end-to-end transaction reference number (which was missing earlier) to enable unique transaction identification and tracking of the lifecycle of transactions. Now, SWIFT is collaborating with various fintechs to build overlay services on top of the global payments innovation (GPI) platform.
There is a likely emergence of real-time cross-border payments as global banks or other market infrastructure providers begin connecting domestic real-time infrastructures to improve their customer offerings.
Fintechs have taken significant market share from traditional banks in this space and several banks have started to fight back. Banks have begun building new cross-border payment interface and mobile applications, repricing FX and transfer costs, collaborating with fintech players to enhance offerings, and in parallel trying to improve the back-end infrastructure to create a competitive offering. Is this a wake-up call for players who are still in a state of denial?
The post Will fintechs dominate the cross-border payments market? appeared first on Accenture Banking Blog.
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Deserve Raises $50M to Expand Account Receivables
EXCLUSIVE— Millennial and Gen Z-focused credit card provider #Deserve has raised $ 50 million from the Keystone National Group, funding earmarked for the startup’s expansion of #account #receivables, the company announced today. “It’s strictly a debt facility, it has nothing to do with new product launches, but it does allow us to scale,” Kalpesh Kapadia, CEO […]
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Cryptocurrencies Surge as Debate Over Digital Tokens, Securities Reignites
EXCLUSIVE— #Cryptocurrencies are experiencing one of their highest points in recent weeks, after remarks made by former financial regulator Gary Gensler brought back concerns that certain #tokens should really be considered #securities. The remarks point to a reoccurring #debate among #cryptocurrency aficionados about the nature of #digital currency, which is having its first positive movements […]
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SmartBiz Loans Uses Tech And People To Expedite SBA Loan Applications
SmallBiz #Loans provides #banks and small businesses #technology to help process Small Business Administration (SBA) loans. Its automated advisor acts like a small business CFO, analyzing financials and telling owners if they are a good candidate for the SBA or helps them identify areas to improve.
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Fintech solarisBank Aims to Add 50 Partners in 2018
EXCLUSIVE – Known as one of the first #technology companies in Europe to procure a German banking license, #solarisBank has lofty ambitions for #2018. That plan, according to Timo Weber, VP of strategy and internationalization, is to add 50 more #partners over the course of the year. “A big part of our effort this year […]
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Building bank cultures where engineers can thrive
Co-Author Abidemi Ogunbowale-Thomas, Digital Senior Manager
Nowadays, there’s so much attention focused on the rise of the robots that the #engineers who create them are getting overlooked. In this post, we’ll look at why this is such a key issue for financial services organisations, and what they can do about it.
The objective? Fostering #cultures where hard-to-find and hard-to-retain engineers will feel included, respected and inspired.
In our experience, too many organisations are still failing to look after their engineers. Why’s that such a mistake? Because to #thrive in the digital era, organisations need the agility that comes from bringing #technology to the decision-making core of the business. And that means radically reassessing the role of engineers within the organisation.
Up to now, engineers have often been taken for granted. They’re the people who get the code written. End of story. That outlook needs to change. As a starting point, #banks need to recognise that engineering is an art form.
Engineers and technologists see themselves as digital artisans, craftspeople who’ve studied hard to acquire and hone their specialist skills. And they expect work that challenges and stimulates them in equal measure. If they don’t get it, their productivity can be critically affected.
This new awareness should help banks to build true engineering cultures. These have three strands running through them:
- First, learning. Technology advances quickly, so organisations must inspire their engineers to keep pace. Because recruitment can be difficult, expensive and time-consuming, it makes much better sense to invest in upskilling the existing workforce. Structured training programmes and personal development days are both important. A focus on learning has an added benefit: It gives the organisation deep insight into their engineers’ current (and targeted) capabilities. The ideal? FullStack engineers, people with coding expertise in multiple applications. But they’re few and far between. The more realistic goal? Having a team of t-shirt engineers who are willing to keep learning new skills.
- Second, make sure engineers have the tools they need to get the job done. We’ve seen too many companies expecting their engineers to deliver the world, but with devices that are slow and ineffective. This wastes time and impacts productivity. It’s also demoralising and can create a vicious blame cycle between the business and engineers.
- Third, focus on transparency and equal voice. Business decision-making is much less likely to be shared and understood in organisations where departments are siloed. And that lack of business value context is like blindfolding engineers and then asking them to deliver market-leading solutions. Equally, engineering must have a voice at the top table to influence decision-making and the direction the business is taking.
The benefits of sharing the bigger business picture can be seen at Facebook: Engineers there get to see the monetary impact, positive or negative, of their work. Adopting a similar approach doesn’t just lead to better solutions; it’ll make your engineers feel like they’re part of something bigger than coding. That will increase their job satisfaction and, as a result, their effectiveness.
By tying these three strands (learning, tools and transparency) together, banks will cultivate skilled, fulfilled engineers who are also business savvy. Cultures like these are the lifeblood of the Netflixes and Googles of this world, where the work engineers do is integral to the broader business strategy. But from what we see, banks are still lagging a long way behind.
We’ve provided a comprehensive to-do list. But what’s the fundamental message? Ultimately banks won’t change their cultures until they commit to bridging the divide between the business and IT. Technologists have to be business-aware. And business people need to understand technology. This is imperative for the future. And guess what? The future’s already started.
The post Building bank cultures where engineers can thrive appeared first on Accenture Banking Blog.
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