Latest reports and research: Finextra Research

Report

Personalisation-as-a-Service: Harnessing Data in the Banking and Payments Industry

A Finextra Research Impact Study in Association with FICO and Amazon Web Services (AWS). As customers increasingly experience more consistent, personalised treatment from companies across a wide variety of industries, it is natural for them to expect—and require—the same of financial services providers. Consumers do not want disjointed experiences across auto loans, credit cards, and HELOCs any more than they want them when shopping for different categories within the same online retailer. Aside from consistency, 84% of customers revealed that being treated like a person, not a number, is important when winning and retaining business. That’s according to Accenture Global Consumer Pulse Research, which also found that 73% of consumers expect specialised treatment for loyalty and anticipate rewards for past interactions, as well as for sharing their preferences or personal information. However, only 22% believe that customer experiences are tailored effectively by organisations, and 50% fewer consumers perceive their bank as a trusted partner today than in 2018. Thus, there is a significant opportunity for savvy financial services companies who can meet consumer expectations. At the same time, financial institutions that fail to satisfy those standards are in jeopardy, as customers are re-evaluating their choice of financial providers given an increasingly diverse and non-traditional range of alternatives. Ultimately, consumers want financial providers to offer personalised services and integrated offers that address their most relevant needs at the right time, such as when they are buying a car, getting married, purchasing a home, continuing their education, etc. The financial institutions that can anticipate customer needs and deliver service that is personalised and consistent across channels will be well positioned to thrive in the digital age. Download your copy of the Impact Study below to learn more.

30 October 2020 525 downloads

Report

The Tipping Point of Cloud and Risk Management in Capital Markets

A Finextra Research Impact Study in Association with Numerix and Amazon Web Services (AWS). Capital markets firms are acknowledging that the cloud is a catalyst for establishing competitive advantage and the financial services sector has been taking steps to prioritise digital transformation. To meet customer requirements and remain competitive, financial services organisations must increase their agility, reduce time to market for new products and services, and address the spiralling total cost of ownership (TCO) of their IT infrastructures. Today, it is evident that all roads lead to the cloud. Download your copy of the Impact Study below to learn more.

05 October 2020 435 downloads

Report

Increasing Resilience in Collaborative Financial Services

Data is the lifeblood of every business. In the rapidly evolving ecosystem of financial services, the establishment of a robust and efficient cloud-based information management platform to govern this data is integral to a firm’s ability to remain resilient in uncertain times while building market share. While the financial services industry increasingly leverages the value of data, the way in which it is collected, stored and deployed is evolving to keep pace with customer expectation, regulatory demands and seismic innovation in technology. Collaboration between banks, partners, customers, or third-party providers represents a key shift in financial institutions’ approach to data, yet, ensuring the systems that are in place work to both protect and share data between these players is challenging to navigate. Building cloud-based information management systems from the ground up is often an unrealistic premise, particularly in financial services. Firms operate with pre-existing systems, and the reality remains that these legacy systems will build the backbone or springboard from which resilient information management systems will emerge. It is vital that firms understand the need to collaborate with external providers to extend the availability of this data across diverse hybrid environments if they are to effectively implement these technological advancements. Directives and regulations pushing banks to open access to their information assets puts a hard deadline on the calendar for such projects and means that those which act early can benefit from being first to market with solutions that not only meet compliance requirements but capitalise on new opportunities. Interoperability is a fundamental tenet of this collaborative ecosystem. It is the ability of financial institutions to work collaboratively with providers to deliver this type of efficient, secure and resilient data management platform which will determine their success in this new information-sharing climate. Download the full white paper below to find out more.

16 September 2020 84 downloads

Report

The Future of Fintech 2020

Disrupt, reset, re-launch. The fintech industry has evolved from competing and collaborating with banks and has now entered a new era of partnerships, with those at the forefront of digital transformation prioritising technology and legacy participants working with new financial players. In addition to this, traditional financial institutions are partnering with challenger banks to provide refined products and services that attest to putting the customer first. However, questions have been raised about how an alliance with a neobank would be preferable to a merger or an acquisition. The concept of a ‘challenger bank’ will also be examined in this report, and why, after years of development and progress, it has become difficult to differentiate between the vast number of neobanks in the industry because their offerings are vastly similar. Finextra’s The Future of Fintech 2020 report will explore how banks have embraced innovation and what benefits have emerged from establishing technology initiatives, partnering with neobanks and investing in fintech firms. Further, the report explores what and how the industry should behave in the face of a crisis and how to bounce back stronger than ever. We will also consider whether customers would benefit from financial institutions merging all their services onto one application as the digital age welcomes the platform ecosystem, which has seen success in Asia and is being gradually implemented in Europe and the US. Download your copy of the report now.

03 September 2020 959 downloads

Report

Sustainable Finance Live - Investment and Asset Management ESG Solutions

A Visual Record from the Sustainable Finance Live workshops. In June 2020, Finextra Research welcomed industry experts to Sustainable Finance Live, the first virtual, interactive workshop to discuss how financial services firms and technology companies can achieve the UN’s Sustainable Development Goals (SDGs) by 2030. Debunking the myth that revenue cannot be generated through trustworthy implementation of ESG measures, this co-creation event targeted the subsector of investment and asset management and explored specific challenges and opportunities, following a lean back, lean in and learn model. The workshop defined what investors require in order to track and securitise with confidence and what asset managers need to build portfolios that institutional investors will select. Diving deep into the practical challenges of investment and asset management, the sessions considered data access and reporting, with speakers providing advice on how to embrace sustainable finance. With a top down approach, a clear focus of the sustainability components and trying to infer the process of assessing the following, the workshop focused on: The investment gap in new technologies and models Information acquisition through third party suppliers to help the risk function Incentivisation schemes to promote better sustainability norms The role of technology in validating ESG activities Download the full report below to find out more.

27 July 2020 271 downloads

Report

How to Prevent Payments Fraud amid Global Disruption

Economists predict the disruption caused by the coronavirus pandemic will be felt well into 2021. Banks have been left vulnerable and have to contend with fraudsters who are using Covid-19 as an opportunity to commit financial crime, exploiting consumer fear and the increase in digital payments. Fraud losses need to be anticipated and prevented as banks move from the lockdown to the recovery phase. What must be done to ensure the secure use of alternative payment options? In the age of open banking and real-time payments, funds can be transferred to fraudsters’ accounts immediately and the victim does not notice suspicious movements until it is too late. It is evident that with faster payments methods, the benefits for consumers far outweigh the disadvantages, but hackers will continue to exploit this area. Fraud analysts within a bank must pivot and adapt to working in a new environment to ensure that teams integrate efficiently and decrease human error through a lack of physical communication. Data is a vital tool in a bank’s armoury and must be considered an asset. AI and machine learning can also play a part in fraud and financial crime prevention, consuming disparate unstructured data and creating structured insight and conclusions. Coupled with traditional fraud techniques, banks need to pivot their payments fraud strategy to a tech-driven approach. This research paper by Finextra, in partnership with Feedzai, gathers the views of several experts from Bank of the West, Barclaycard Payments, HSBC, ING, Nationwide and Nordea on how to prevent payments fraud during a pandemic. Download the full report below to find out more.

16 July 2020 635 downloads

Report

Onboarding next steps for new and established Digital Banks

Customers want the onboarding and account opening process to be as easy as possible. A certain amount of friction is to be expected when it comes to identity and security checks, reassuring them that their prospective financial service provider takes security and their data seriously. Signing up for a new financial services product shouldn’t be as simple as providing a username and email address. But nor should it always require reams of paperwork, branch visits and forms signed in triplicate. In the past five years, banks of all shapes and sizes have invested significantly in streamlining their processes so that the regulatory checks such as Know Your Customer (KYC) and Anti Money Laundering (AML) can be met while minimising, where possible, the number of postal and in-branch interactions required for establishing identity and product suitability. Depending on the market segment and product, this process can be done 100% online and ideally via a mobile device – a channel that now dominates for even traditional banks with established, older customer bases. Digital onboarding is just the start, however. Banks, both new and established, are looking to improve the integration of identity at onboarding with ongoing authentication credentials, and adopt a risk-based approach to security throughout the customer lifecycle that can adjust the balance between protection and convenience for customers. Download the full white paper below to find out more.

14 July 2020 838 downloads

Report

Is Request to Pay the System for a World of New Norms?

With faster payments going live in the UK in 2008, one could regard the decade-long recovery from the financial crisis as being a journey towards realtime payments. The last few years has also seen the advent of Open Banking, firstly in the UK and subsequently across Europe and elsewhere. Request-to-pay (RtP) is an example of harnessing Open Banking to serve financial institutions, SMEs and consumers in removing some of the frictions relating to sending and receiving payments for lenders, businesses and individuals. Ahead of its introduction later in 2020, RtP was billed as an integral tool to the transformation of the payments landscape across the world. RtP is being widely promoted in the UK, Europe, the Nordics and the USA, all of which have active industry programmes. This paper will explore the opportunities for lenders, businesses and consumers provided by RtP as well as the hindrances and challenges that would need to be addressed to move to widespread adoption. Download the full report below to find out more.

13 July 2020 973 downloads

Report

Shifting to the New Normal in Card and Digital Payments

It is an interesting time for the cards industry and for issuers there is a similar narrative to that of legacy banks and digital transformation. There have been several drivers of innovation in recent years, very much accelerated by the current pandemic and the various demands and transitions that have been wrought on the entire industry in different ways, as well as on the consumer and client base. What are the key factors for survival as competition increases and regulatory compliance bears down on security measures around customer data and fraud as well as on a looser and more empowered user experience? Utilising new data that can be more easily captured and carried with transactions can inform and shape new services, and better overall understanding of customer behaviour, leading to increased personalisation and an array of added features. As integration into retail commerce platforms and an increased demand for frictionless and invisible payments takes hold, is the physical card becoming obsolete or can issuers create new propositions to retain their position? Competition in the cards industry has evolved from terms such as interest rates and fees, to balance transfer products, to loyalty and rewards and more recently has been diversified by new fintech providers. This research paper by Finextra, produced in association with FIS, is based on several interviews with cards industry experts, to formulate a view on how issuers can compete in the digital world as payments continue to proliferate and fintechs disrupt the status quo. Download the full report below to find out more.

07 July 2020 891 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

Report

Instant Payments: Why Covid-19 is Bringing the Roadmap Forward

Business continuity has never been a more valuable asset for financial institutions. Fundamental changes to 'business as usual' as a result of Covid-19 have exposed the need for resilient, reliable, and efficient systems to maintain essential payment services and protect the interests of all ecosystem participants, from consumers to the largest corporations. At the same time, in the lead up to the European Single Market Infrastructure Gateway's (ESMIG) 'big bang' migration at the end of 2021, EU financial institutions are understandably consumed with ensuring that they are appropriately equipped to manage the systemic changes the migration will demand. While ESMIG provides a hard deadline to work towards, every institution bears unique targets and objectives, making the structure and execution of these plans more challenging than ever. In this context, it might seem that the adoption of real-time or instant payments—immediate settlement of account-to-account payments on a 24x7 basis, domestically and cross-border—should reasonably take a back seat to more pressing existential concerns. After all, while the ESMIG migration is mandatory, instant payments are not, and financial institutions could be forgiven for focusing solely on compliance-driven projects at the expense of optional ones. This impact study will outline why the reverse is true: that in fact, the move to instant payments takes on an increased urgency in the coronavirus age. It explores the benefits of instant payments for banks' internal operations as well as their customer value propositions. It also examines shifting approaches to business case development, and the increasing relevance of cloud and as-a-service models for instant payment processing. Find out more by downloading your copy below.

11 June 2020 639 downloads

Report

A 3 Step Guide to Driving Customer-Centricity with Big Data

As a result of increased competition and rapidly changing consumer expectations, banks are under increased pressure to develop the way they target and appeal to customers and in turn, maintain a profitable personal relationship. In addition to this, the General Data Protection Regulation (GDPR) in Europe and the California Consumer Privacy Act (CCPA) in the US have set a foundation for data consent management and ensuring that customers’ personal information is always protected and secured. Now they are breaking down their data silos, banks are struggling to harness the information that is key to unlocking customer relationships in this ever-changing market. While they are navigating their way through such a volatile environment, traditional financial services companies are often reluctant to change and may find it difficult to implement new technology from which they can derive value. This is partly because they have had bad experiences with tech projects in the past that did not deliver or bring changes as expected. However, smart technology and out-of-the-box solutions in the form of powerful customer data platforms (CDPs) are readily available and deliver a competitive edge and value to financial institutions. Find out more by downloading your copy of the research paper below.

19 May 2020 406 downloads

Report

The Future of Blockchain 2020

Where DLT is taking effect in financial services and what the future holds. Recent years have seen explosions in interest around blockchain technology, from Bitcoin’s price peaking at nearly $20,000 in December 2017, to the proliferation of initial coin offerings (ICOs) in 2018. In general, interest has been propelled more through hype than expectation. Distributed ledger technology (DLT) has presented many compelling use cases that would make financial services processes easier, quicker, cheaper and more transparent. This has been demonstrated already by numerous major banks who have launched projects in areas such as identity, settlement and foreign exchange. In this report, Finextra Research explores this and other use cases for DLT in conjunction with experts from the financial services industry, and examines what needs to happen for the technology’s potentials to be fulfilled. Download your copy of the report now.

11 May 2020 995 downloads

Report

A Panorama of the Changing Banking Landscape in EMEA

Fintech players have proved that mass-market growth is achievable and are now providing other financial service entrants with a blueprint of how to scale exponentially. What sets the newer banks apart from incumbent providers is that they adapt their offering to meet the needs of their users. There is no universal formula for success that can work across all business models, and across the entire EMEA region. The most common way of generating revenue is charging customers, which would work well in a startup model as these organisations are unencumbered by legacy infrastructure and cost structures. However, untrusting customers want more than an improved customer experience, and companies need to establish revenue sources that can be diversified over time. Additionally, banks must give their customers a reason to bank with them. This research paper by Finextra, in association with Mambu, gathers the views of several experts from Bain Capital, Barclays, Citi, EY, OakNorth, Santander InnoVentures, SEB, Starling Bank and Tink on how to build a bank in Europe, the Middle East and Africa. Download the full report below to find out more.

30 April 2020 1186 downloads