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Winning Top-of-Wallet with a Digital-First Strategy

By David Penn Posted on September 28, 2021
Categories: Fiserv, Sponsored

This is a sponsored post in collaboration with Amanda Glincher, Director of Marketing, Fiserv

It’s no surprise that a digitally issued card shortens the time frame between when a consumer receives a new card and when they begin using it for spend. Yet, digital issuance is just one step on a digital-first journey and without a full strategy, that newly issued card might not bring with it the added spend issuers are expecting.

Yes, consumers want digital-first cards, but they are also in search of digital-first options when it comes to all of their other banking activities. From the first engagement someone has with a new financial institution, each traditional activity should have a digital counterpart.

Applications that win

The beginning of a banking relationship often begins with a consumer applying for an account. Creating an application process that is seamless and reduces barriers is the best way to start the cardholder’s digital experience. As noted in The Financial Brand, when an application takes more than five minutes to complete, abandonment rates increase to as high as 60%. To reduce abandonment and improve the customer experience, applications can be limited to the necessary data.

Add to the convenience by allowing applicants to switch between devices to complete an application without losing their place in the application flow, especially in situations where any documentation or uploads are being requested.

Immediate access

Once you’ve approved a new account, increase usage rates by providing immediate access to a new card. In a world where our groceries are delivered within the hour and the world’s library of movies and music is available to stream in seconds, time really is of the essence with today’s consumer.

70% of digitally issued cards are used within five days, compared to a physical card that won’t even be delivered for 7-10 business days.

Make usage a breeze

“Manually entering my card details and verifying my identity is so fun” is a statement that has never been uttered. Once a card has been digitally issued, make using the card simple by enabling push-to-wallet. There are many benefits to giving cardholders this ability and it is among the most essential parts of a successful digital-first strategy. In addition to the seamless experience for the cardholder, push-to-wallet provides more opportunity for you to capture top-of-wallet for both the physical and digital wallet, as well as bypassing the marketing of competing cards.

Top-of-wallet opportunity

When a card is pushed directly into a Google or Apple Wallet from your app, it provides immediate access and the ability to spend in-person, online, and in-app. With over 85% of U.S. retailers accepting Apply Pay, a digitally issued card that is pushed to wallet is available for use nearly everywhere.

In addition to the availability of the card, the ease-of-use enables consumers to go about their regular spending and utilize your card without missing a beat.

Bypassing the competition

While push-to-wallet is the more convenient way to add a card for a consumer, it’s also the simplest way for an issuer to avoid competition. A customer who chooses to manually add a card to Apple Wallet will be greeted by an offer to apply for an Apple Card. When a card is directly provisioned to a digital wallet, the cardholder bypasses the manual entry point at which they would be offered another product.

Sweetening the deal with offers and rewards

A list of retail discounts, benefits pamphlets, and APR offer checks are among the many mailings we receive from financial institutions. These offers are more accessible and beneficial to digitally savvy cardholders when they are offered, visible, and available in-app.

Not only is this a preferred way for customers to access offers, but a digital-first model allows financial institutions to make personalized offers in the moment – special financing opportunities and location-based discounts – enhancing the cardholder experience and capturing even more spend.

Give insight into all the places a card is stored

For existing cardholders, instant issuance of a replacement card can be made even more valuable by providing information on all the places the old card was stored. A list of existing retailers where their card is on file or is being used for recurring purchases allows cardholders to make sure the card is updated everywhere it needs to be – providing a smoother journey with uninterrupted spend.

Control in the palm of their hands

While card controls and alerts are a standard today, they are also an essential part of a digital journey. Allowing individuals to set limits on transaction types, locations, and amounts – and receive alerts – reduces fraud, minimizes inbound call center activity, and gives cardholders the security of managing their cards 24 hours a day. Controls can include the ability to turn cards on and off, set spending limits, create location boundaries, and report a missing card. Alerts allow cardholders to create notifications for a variety of scenarios, and to keep a close eye on the transactions charged to their account.

The importance of a fully digital journey

While all of these features are beneficial on their own, it is when they come together as part of a full digital strategy that they provide the most value to both the cardholder and the financial institution. Digital issuance is a key part of going digital-first, but it is the combination of this suite of digital-first tools that provide the best cardholder experience.

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How Smart Data Drives Agility in Financial Services

By Charlie Burgess Posted on July 1, 2021
Categories: InterSystems, Sponsored

This is a sponsored post in collaboration with InterSystems, Gold Sponsors of FinovateFall

Delivering reliable, clean, timely data into the hands of decision makers is vital for financial institutions. While this has been true for quite some time, data is becoming more important than ever. The events of the past year have irrevocably demonstrated this point, with financial intuitions realizing just how powerful accurate data is when it comes to making pivotal decisions.

Adding to this complexity is the explosion in the amount of data we’re creating. You only need to revisit this mind-bending stat from TechJury to realize just how much we’re producing: “1.7MB of data (was) created every second by every person during 2020. In the last two years alone, an astonishing 90% of the world’s data has been created. 2.5 quintillion bytes of data are produced by humans every day.”

What does this increased focus on data mean for financial institutions?

The cost of managing data is only going to increase: The amount of data is growing, and with that comes growing costs associated with accessing, ingesting, processing, and storing that information. More data means more throughput and more storage, both of which you’ll pay for. And if you haven’t got systems in place to handle the increase in throughput, you’re going to experience delays. This can not only cause reputational damage, but can also have regulatory and compliance impacts if you don’t have appropriate systems in place to meet your obligations.
It’s becoming harder to compete with emerging players: There’s certainly a benefit to having an established business in that you’ve got insights at scale. With that comes the weight of managing legacy systems and architecture. The more information we pour into our systems, the harder we have to work to be agile.
Customers now expect smart insights: We’re all driven by the technology that powers our lives. And today’s customers expect financial institutions to mirror the intelligent insights that our smart watches and apps deliver to us. There’s a growing expectation that if our watches can tell us the how we can improve our health through personalized exercise goals, sleep reminders, and mindfulness breaks, then surely our banks can tell us how and when to optimize our portfolios, how to increase savings, or how to maximize lines of credit.
Data is essential for people to do their job: In the workplace there’s an expectation, particularly among those coming out of business school, that people will have access to the information they need to do their jobs. Data has become an integral part of doing business. We are rapidly moving beyond just making sure we have the data, and it’s now more about how reliable and accessible it is that makes the difference to employees.

Beyond breaking silos

There are many views on how organizations can improve movement and quality of information. However, some of these approaches can create their own issues.

Financial institutions need to move beyond breaking silos and focus on timely, clean, quality, solutions around data catalogues. This will allow them to map out the entire data needs of the organization. In short, they need to consider the connectivity of their information — how their data can be shared seamlessly across the whole data ecosystem. It’s what we refer to as “data fabric”.

What is data fabric?

Data fabric is an architecture and set of data services that provide consistent capabilities across a choice of endpoints spanning multiple on-premises and cloud environments. Gartner describes it as “frictionless access and sharing of data in a distributed network environment.”

How smart data fabric is driving agility in financial services

Implementing a smart data fabric allows financial institutions to make better use of their existing architecture because it allows their existing applications and data to remain in place. It then integrates, harmonizes and analyses the data in flight and on-demand to meet a variety of business objectives.

Having a smart data fabric allows financial institutions to remain agile in a number of ways:

Allows businesses to make smarter decisions faster

Banking is seeing new market entrants like gaming companies, retailers, transports and telcos, all clambering to get in on the financial services game. A well-constructed data fabric empowers executives and lines of business to monitor and anticipate changes, both positive and negative, in internal and external environments.

Helps identify new segment opportunities

One of our customers anticipated the impact of distressed debt amongst their credit card consumers and utilized their data fabric to proactively contact potentially affected clients. By offering extended payment terms they fostered stronger customer loyalty and mitigated a potentially large bad debt situation. This same process of customer segmentation can be used to identify new market opportunities.

Enhances customer experience

A smart data fabric allows faster processing of clean reliable data which financial institutions can use to share insights with their customers. By sharing these insights, financial institutions can foster loyalty and drive spend in a highly competitive environment.

Drives efficiency and cost savings

Finally, making decisions based on timely, accurate data allows financial institutions to reap all the benefits just described. Without the certainty that comes with reliable data, none of these decisions can be made efficiently or cost-effectively because the time and effort associated with managing data simply outweighs the benefits.

Leading financial services organizations are leveraging smart data fabrics to power a wide variety of mission-critical initiatives, from scenario planning, to modelling enterprise risk and liquidity, regulatory compliance, and wealth management.

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Preparing For the Unprecedented: How Lenders Can Effectively Manage Commercial Credit Risk in an Ever-Changing World

By Charlie Burgess Posted on May 26, 2021
Categories: Sponsored

This is a sponsored post in collaboration with Sean Hunter, CIO at OakNorth

When it comes to commercial lending, banks rely on risk models to make decisions. These models have been built up internally over decades of lending across thousands, if not tens of thousands of loans, but COVID-19 has exposed unexpected flaws in them. As a result, lenders are re-assessing how best to manage commercial credit risk in the future when other unprecedented events will inevitably occur.

Challenges

The first challenge is that traditional risk models are based on historical data, but in a rapidly changing world, extrapolating from the past is an approach that is no longer fit for purpose. Events such as trade wars, pandemics, natural disasters, and climate change are by their very nature situations that are hard to predict or plan for. We can make assumptions based on what we have seen with similar crises in the past, but no two are the same. Therefore, any data needs to be supplemented with a forward-looking view, which takes into account future challenges that may arise and that provides the much-needed foresight to make more informed credit decisions.

The second challenge is that most banks’ risk models tend to lump all businesses into one of a dozen or so categories – all restaurants, bars and hotels for example, are classified as “hospitality”. This disregards the fundamental differences in how these businesses operate, and makes it harder for lenders to identify the most vulnerable businesses in their portfolio. The experience of a pizza delivery / takeaway chain in New York City throughout the pandemic will have been very different to a Michelin-star fine dining restaurant in The Hamptons for example. Under lockdown, the Michelin-star fine dining restaurant is unlikely to have experienced any business, whereas the pizza chain may have seen an increase in trade as people were spending more time at home. When lockdown eases, however, and restaurants are allowed to reopen (but with strict social-distancing and cleaning measures in place), the situation could be quite different. The formerly empty Michelin-star fine dining restaurant may experience a surge in reservations as many diners would have saved money from a lack of socializing for several months, and look to make their first meal out “special.” Meanwhile, the pizza chain may see demand for deliveries shrink as people rush to enjoy the outdoors and take advantage of their freedom.

In a fast-changing world, a timely change of course informed by insight and foresight is much preferred to 20/20 hindsight when it’s too late to avoid a problem.
– Sean Hunter, CIO at OakNorth

Unprecedented events such as the pandemic can also lead to structural changes which have permanent or long-term implications for the sector. Take a paper and board packaging business for example – during the pandemic, it will likely have seen revenue from paper sales decrease as businesses moved to remote work and instituted digital solutions such as DocuSign. However, on its balance sheet, year-on-year sales for the entire business in 2020 may not seem too different than in 2019. This is because the decrease in demand for paper has been offset by an increase in demand for cardboard as people under lockdown shop online and order items to their home. While the move away from heavy paper use is likely a permanent change from the pandemic, the increase in online shopping is unlikely to stay at peak pandemic levels once people are able to return to in-store shopping. Therefore, if the business fast forwards six to 12 months, it could see a decrease in revenue that it hadn’t been expecting and therefore, hadn’t planned for.

In this example, the lender, armed with this data, can take an informed, consultative role and share this analysis with the borrower, suggesting that they think carefully about any changes that will add to their cost base. Equally, the business’ management team can now be better prepared for changes further down the line. In a fast-changing world, a timely change of course informed by insight and foresight is much preferred to 20/20 hindsight when it’s too late to avoid a problem.

The third and final challenge is that traditional risk models don’t take into account how quickly the situation changes day to day. The approach taken by the Trump administration to address the impact of climate change for example, were completely different to the steps being taken by the Biden administration. Lenders therefore need the ability to re-run analyses and stress test on an ongoing basis in order to determine how governmental or socio-economic changes are impacting their loan book.

Solutions

At OakNorth, we’ve created the ON Credit Intelligence Suite to enable banks to lend smarter, lend faster and lend more to businesses. In order to ensure lenders can obtain an incredibly granular, bottom-up view of every business in their portfolio, we’ve split the economy into 262 different sub-sectors. The software is made up of three components:

ON Credit Analysis: which provides lenders with a 360-degree view of borrowers with instant financial forecasting, sector insights and peer analysis.
ON Portfolio Monitoring: which enables lenders to easily track sub-sector industry trends and set early warning alerts for potential covenant breaches.
ON Portfolio Insights: enables lenders to instantly segment their portfolio and rate loans based on level of vulnerability.

Find out more and join the upcoming webinar with OakNorth to dive deeper into this topic, featuring Jeremiah Norton, former FDIC; Bruce Richards, former Federal Reserve Bank of New York; and Mark Levonian, former OCC. Register now >>

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Is Smart Data Fabric the Approach Financial Institutions Have Been Dreaming About?

By Charlie Burgess Posted on May 13, 2021
Categories: Sponsored

This is a sponsored post in collaboration with InterSystems, Gold Sponsors of FinovateSpring, and Monica Summerville, head of capital markets, Celent, a division of Oliver Wyman.

Financial institutions and data have had a love-hate relationship for many years.

On the one hand FIs and data are a match made in heaven. It is a symbiotic relationship where business functions create and consume data over and over until the result exceeds the sum of the parts. Ideally this partnering results in revenue or alpha-producing insights. On the other hand, siloed, unreliable or simply too much data creates frustration and risk as the business potential is teased, but ultimately unattainable as FIs struggle to extract value from their data (see figure 1).

Business use cases for leveraging data across financial services are plentiful, from management reporting, enterprise risk, liquidity and treasury management, and more recently, driving innovative customer experiences. More specifically within capital markets and banking, trends such as the embracing of multi-asset trading or the desire to simplify architectures have triggered a rethink of data approaches. There is also, now more than ever, the desire for cost savings – equally important to FIs whose margins are increasingly coming under pressure from increased regulation and competitive factors. Indeed, research by Oliver Wyman and Morgan Stanley found that the benefits from having clean, consistent, and automated data management could be a two-to-four percent reduction of infrastructure and control costs. When IT spend ranges into the billions of dollars, as is the case with larger FIs, every percentage point of savings is a big win.

No wonder then that cracking the data management challenge has long been considered the perfect marriage of technology achievement and business function. FIs have made repeated attempts and invested hundreds of millions of dollars through the years to get this right. From simple relational databases storing structured data, to data warehouses and more recently data lakes capable of holding all types of data, there has been no shortage of excitement that maybe (whisper it) this latest approach could be “the one.” Heartbreaks inevitably followed as the heady days of getting to know new technologies turn into frustrations and recriminations. A pristine data lake becomes a swamp.

The latest research by Celent discovered that leading FIs including Bank of America, Citi, Goldman Sachs, JP Morgan and RBC, to name a few, have lately been getting serious with a new data management approach called Smart Data Fabric. As these entities move from a process- to platform-driven organisation, their business focus has shifted to ensuring the best customer experience possible. This shift however requires mastering and leveraging data to generate insights at an enterprise level. The reality is that a history of disjointed business expansion common to financial services, means data is siloed across numerous platforms, tuned for very different use cases. There are multiple “single sources of truth,” and these vary depending on whose truth you are seeking.

The right data management approach should empower FIs to become better versions of themselves, without fundamentally changing who they are. Unlike previous data management architectures, Smart Data Fabrics offer centralized access and a single unified view of data across the organization. Crucially, Data Fabrics do not require that copies of the data be created and stored outside its original location, so can offer a useful bridging solution between modern and legacy systems – the latter often holding the most business crucial data. In this way Data Fabrics can also avoid the creation of more data silos, which is especially important as FIs increasingly embrace cloud. A Data Fabric becomes “Smart” when it inherently supports advanced data analytics and aims to future-proof data management (see Figure 2).

Financial institutions, from asset managers to banks and brokers, have always known that they need to become smarter about data. Business end-users and clients are demanding better user experiences, targeted insights, and increased access to analytic capabilities which requires free access to accurate and harmonized data drawn from disparate sources across the entire enterprise. At the very core of modernization is the ability to innovate at scale, and this relies on freer access to data. Celent’s latest research report sponsored by InterSystems found that the business necessities and benefits of better data management is driving adoption of Smart Data Fabrics. This time it might just be for real. Read the full report here >>

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Fast Money: The Innovation Race Between Established and Upstart Financial Services Firms

By Charlie Burgess Posted on May 4, 2021
Categories: Sponsored

This is a sponsored post from Michael Hom, Global Head of Financial Services Solutions, InterSystems, Gold Sponsors of FinovateSpring.

The banking and finance industry has always been capable of adapting. But as the world recovers from the pandemic, banking and financial services face a new disruption from fintechs and “neobanks.” With lower cost bases and a very different, technology-driven approach to customer experience, these newcomers have been developing fast.

The financial services sector has also experienced a massive rise in digital banking usage caused by the Coronavirus pandemic. For institutions with healthy infrastructure, this was a big positive, whether it was in high net worth advisory or remote banking. It also showed the centrality of high-quality digital user experience to today’s customers.

We must not assume, however, that all is well on the disruptor/innovator side. Some internet-only banks were laying off staff during the pandemic because their ramp-up costs are high – and their paying customer bases are still growing. They also have market share and profit margin challenges through stiff competition from other fintechs.

Established finance institutions, on the other hand, have huge numbers of customers and significant revenue streams. Their challenge: to innovate and make their legacy systems and data management strategies swift enough to keep up with their new upstart challengers. These legacy systems and problems with data management have hampered innovation.

The challenger banks and fintechs, by contrast, are far more agile: they have perhaps two-thirds lower technology costs and offer the interfaces and functionality younger consumers and companies want. They also have investors who support them. Yet they don’t have the scale of the big banks, nor the data. In banking, success is all about scale and achieving it is not easy. Each side also has different cost-pressures. While the fintechs concentrate on the cost of getting a new customer through the door, banking industry incumbents want to be more efficient and reduce the cost of execution.

How the industry will evolve

Large banks know if they get the connection right with consumers and corporations, they will be in a much better position in the next five or ten years. To do this, however, they need the fintechs’ agility. They must simplify their data management so they can adapt to changes in demand rapidly and scale as workloads increase. They must be capable of building and deploying data-intensive AI applications faster so they can transform the user experience for consumers. There needs to be a wider recognition that simpler approaches can be highly effective.

Fintechs and neobanks, on the other hand, need a compelling value proposition to attract consumers and generate meaningful revenues.

This is why the incumbents and the fintechs will draw closer through collaboration or acquisition. By collaborating with incumbents, fintechs and neobanks can use their digital skills and innovation to make niche areas of the established institutions’ operations far more profitable while benefiting from access to a massive customer base it would otherwise take them years to acquire.

Modern data management technology such as microservices, APIs and API management, have lowered barriers to publish and consume services, creating a dynamic ecosystem that allows organizations to focus on their core competencies and differentiation. They can rely on the ecosystem for commoditized, non-core, and non-differentiating capabilities.

Acquisition, on the other hand, brings its own problems, since the pace of innovation often slows once a young organization has been bought by an established competitor.

For these reasons, we may see a hybrid model between collaboration and acquisition, in which the big incumbents develop through consolidation into aggregators, becoming open banking marketplaces and acting as the nexus between customers and services. A new digital retail bank may, for example, use a major player’s credit expertise, risk and control mechanisms while designing a new user experience from scratch.

Whichever model of cooperation it is, the new offerings devised together by incumbents and fintechs will have to stand out. With so much competition, differentiation through excellence in technology, customer experience and support will be essential.

What does the future require?

Agility is vital to the future of banking and should be a major aim for all ambitious financial organizations. Mindsets must change as well as technology.

From now on, senior management in banks must think like their counterparts at software companies. That means constantly gleaning what is going well or wrong and acting on it. When there are problems, they should be fixed before customers are fully aware. Many neobanks are leading the way on this, updating their apps weekly. Big banks, by contrast, are much slower, updating apps yearly or quarterly, with a few in the four-to-six week timeframe. This has to change.

When deciding how to transform, incumbent organizations must ask themselves how they are addressing client and employee needs in terms of products, services, and information. They must build a picture of where banking is going and be confident they are heading in the same direction. Established banks must become product-oriented organizations just like digital native rivals, abolishing internal boundaries and creating cross-functional teams under product owners.

Keep the organizational DNA alive

Scale, innovation, and agility have become vital attributes in banking. Yet as incumbent institutions adapt and assess which newcomers to partner with or acquire, it is essential they do not lose sight of what it is that makes them special or forget what their goal is. Banks are still about people, processes, and technology, and the people side of the business is where high levels of service and distinctiveness enable the organization to stand out and build profitable long-term relationships.

If organizations lose their DNA, they will crumble. Incumbent banks have a larger and more diverse customer base that is difficult to please and, in today’s world, less likely to tolerate low levels of service from loss of organizational focus.

Established banks must be as nimble as possible and collectively approach their work as if their business model is at risk every day. It is not only digital transformation that is necessary, but also a mental mind-shift. Only then can banks believe they are on the path to digital transformation, resilience, and long-term profitability.

Find out more about the future of financial services and why the ability to see around corners will offer the most advantage in this webinar hosted by The Economist and sponsored by InterSystems >>

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The Future of Banking in a Digital-First World

By Charlie Burgess Posted on April 26, 2021
Categories: Sponsored

This is a sponsored post by Quantum Metric, Gold Sponsors of FinovateSpring.

One of my favorite sayings about digital banking is that the largest branch in the world is now in your pocket.

The retail banking customer journey has become more complex than ever before. Each day, clients are moving between a number of devices, which means that banks need to find new ways to study, monitor, view, and study the cross-device journey, especially on mobile devices.

It goes without saying that, for traditional retail banks, Covid-19 accelerated the shift to digital. But in-person branch use was already declining before that.

The good news for retail banks? Current federal regulations mean that elements of the in-person experience will remain important, so branches aren’t disappearing entirely. In addition to finding ways to boost in-person engagement at branches, retail banks have the extra challenge of offering omnichannel digital experiences that are on par with those offered by the latest fintech startups, like Robinhood, as well as other household apps, such as Amazon, Airbnb, and Twitter.

The boom in fintech, and especially the rise of neobanks like Chime and Ally, means that more clients are choosing banks that don’t offer in-branch services, where customers get the typical one-on-one service from a teller. Popular peer-to-peer and peer-to-business payments services such as Venmo, PayPal, Square, and CashApp have put additional pressure on retail banks to offer standout mobile experiences.

As traditional banks look to remain competitive with fintech startups, they will need to offer digital experiences that streamline everyday banking processes. Clients want to open new accounts, apply for credit cards, and deposit mobile checks with as few clicks as possible, and directly from their mobile devices.

Fintech startups have a leg up on retail banks because they offer fewer services and leverage the most advanced cloud technology. Many retail banks are burdened by legacy platforms, outdated processes that slow things down, and poor alignment within the organization.

Many banking clients miss the benefits of in-person engagement, especially seeing a friendly face at their local banking branch. Retail banks can approximate the friendliness of in-person service by doubling down on their digital channels, which means offering applications with intuitive user interfaces and user experiences. Above all, people want simplicity, transparency, and speed.

Banks and other financial institutions have the added burden of navigating complex federal regulations. These institutions are responsible for safeguarding clients’ money and remaining compliant with both local and federal laws. A few small errors can not only break trust with clients, but lead to millions of dollars worth of fines.

As banks double down on digital channels, they need to introduce the perfect amount of user friction for tasks such as opening accounts, filling out loan applications, and transferring funds. One small click can lead to major problems or misplaced funds, so making clients re-enter passwords or confirm transactions can build major trust.

On the other hand, too many steps in a workflow leads to abandoned applications, lower conversion rates, and frustrated customers. Worse yet, clumsy designs and technical errors often make it impossible for clients to complete tasks without assistance from a call center. There will always be technical errors, and to solve this, banks can put clients in contact with agents by providing pop-ups that include a direct phone number or a chat window when a problem arises.

Once banks have the basics down, they can invest in hyper-personalization, which helps clients feel more connected to their products. Erica, Bank of America’s Voice Assistant, has helped revolutionize the mobile banking experience. The AI-powered chatbot helps clients answer pressing questions about their banking needs, making it easier for them to find answers for common questions.

As retail banks rebound from the Covid-19 pandemic, they will need to engage in data-driven design thinking to ensure that each digital product decision benefits clients. That is why we have built the Quantum Metric platform, which helps retail banking teams act with more agility. Our methodology, known as Continuous Product Design, helps teams from across an organization align on the product decisions that will have the greatest impact on customers and the business’s bottom line.

In today’s digital-first world, retail banks need to identify problems before they impact a large segment of users, as well as anticipate potential issues as before they happen. That’s why our platform offers real-time analytics and anomaly detection technology. Our platform can help digital teams at retail banks pinpoint a broken button that causes conversion rates to plummet, pinpoint fraudulent activity from bots (e.g., too many login attempts), and much more.

Once retail banking teams get a handle on their omnichannel experience, they can begin expanding into other services and offering additional resources, such as financial education resources. The move to digital provides ample opportunities for diversification. Now banks need to use data-driven design thinking to determine what’s next.

Learn more >

Photo by Marvin Meyer on Unsplash

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The Evolving Role of the CDO at Financial Organizations

By Charlie Burgess Posted on April 6, 2021
Categories: Sponsored

This is a sponsored post from InterSystems

Over the past several years, the role of the chief data officer (CDO) has evolved from being security-and compliance-oriented to being strategic and innovative. Not only are chief data executives of all stripes taking on a more progressive role in key business decisions, but the position itself is becoming an essential staple of forward-thinking organizations, especially at financial services organizations. According to a 2019 study conducted by Forrester, 58% of organizations had appointed a chief data officer and another 26% were planning to do so.

Moving forward, data executives must focus not only on securing data and ensuring their organizations meet rigorous data regulations but also on new strategies for leveraging Big Data and their organizations’ proprietary data to generate business value. This will require new strategies in data management, as well as the deployment of new data solutions like data fabrics, automated governance, machine learning, and blockchain.

Primarily, it will require data leaders to focus more on offensive data management—a data strategy that supports key business objectives, such as boosting profitability and improving customer outcomes—in addition to defensive data management, which refers to the strategy of securing data and maintaining compliance with regulations.

Read Intersystems’ latest report on The Evolving Role of the CDO at financial organization, which provides benchmarking information about how CDOs are fairing in a rapidly shifting regulatory landscape and exploration of CDOs’ and other data professionals’ opinions on enabling an offensive approach to data management and their best practices.

Read now >>

Photo by Tobias Fischer on Unsplash

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5 Key Fintech Trends for 2021

By Charlie Burgess Posted on February 24, 2021
Categories: Sponsored

This is a sponsored post by Accusoft.

While 2020 made its mark on the financial industry by causing tremendous disruption, 2021 is shaping up to be a year remembered for transformation and adaptation. Companies are hard at work building new digital strategies that will help them to thrive in an increasingly volatile economy.

Fintech developers are taking up the challenge to meet the functionality and performance demands of the financial industry as firms embrace true digital transformation. Their ability to build applications that deliver new features and integrate new capabilities into legacy solutions will be critical for helping firms reshape existing technology infrastructures.

Top 5 Fintech Trends to Watch in 2021

1. Customer-First Solutions

With so many fintech applications to choose from, financial organizations must take the time to consider which solutions are best suited for the needs of their customers. Banks and investment firms once put their own needs at the center of their processes, but in an increasingly competitive marketplace, they have realized that providing a high-quality user experience is paramount to success. They can begin transforming processes by eliminating friction to allow customers to access the services and products they need more quickly.

Fintech developers can help them to eliminate manual processes, reduce external dependencies, and automate common tasks by designing unified digital solutions that address multiple challenges and streamline workflows. By integrating features like document viewing, file conversion, and form data capture into their applications, innovative developers are finding ways to strengthen the connection between firms and their customers.

2. Enhancing Digital Collaboration

In response to the COVID-19 pandemic, much of the financial industry has embraced remote work arrangements for the foreseeable future. The transition has created significant demand for digital tools that can facilitate effective and secure collaboration. Not only must physical documents be converted into digital form, but firms also need ways to make those files available to remote employees without threatening data security or causing version confusion.

Organizations frequently turn to a variety of incompatible software solutions and improvised workarounds to meet their viewing, editing, and document management needs rather than implementing a dedicated, all-in-one solution. Unfortunately, these ad hoc measures create inefficient third-party dependencies, expose data to unnecessary risk, and make human error more likely. Fintech developers can integrate these features into a single application through the use of SDKs and web-based APIs.

3. Managing Big Data

Financial services firms gather massive quantities of data on a regular basis. Although much of that data is unstructured and needs to be filtered through sophisticated algorithms to bring notable trends and risks to the forefront, the industry also collects a great deal of data from structured forms. Structured documents such as loan applications, tax filings, and financial statements all provide valuable data insights that organizations can use to make more informed strategic decisions.

Fintech applications with the ability to extract and process data from structured forms accurately is essential for improving the performance of powerful analytics tools deployed by today’s financial firms. Software integrations can further enhance fintech solutions with image cleanup, document alignment, and form recognition features that make the data collection process more efficient and accurate.

4. Disaster Mitigation

After seeing how the COVID-19 pandemic caused massive disruption to global markets and supply chains, financial organizations are reviewing the way they do business to reduce the impact of similar disasters in the future. One of the key steps in this process will be the rapid transition to paperless workflows and an expansion of electronic data capture capabilities to reduce the reliance upon manual processes.

Solutions that incorporate streamlined document viewing, file conversion capabilities, and data extraction tools will be essential to these “disaster proofing” efforts. By automating previously manual tasks, such as data entry, document assembly, and signature authentication, Fintech solutions can help financial companies protect their business processes from future disruptions.

5. Expanded Partnership Opportunities

Although traditional financial institutions like banks have been skeptical of many fintech solutions, the rapidly-changing market has caused them to reassess their technology in order to reach a new generation of customers. Collaboration between banks and innovative fintech startups was already on the rise before the pandemic reduced longstanding barriers to digital transformation. The challenge they now face is how to integrate their operations and data while also launching innovative services across multiple channels.

Fintech developers can streamline this process by building flexible software applications capable of handling a variety of file formats without the need for any burdensome third-party dependencies. In some cases, that may mean building entirely new solutions, while in others it might call for integrating additional features into firmly entrenched legacy applications. The fintech companies with the ability to get innovative software platforms to market more quickly will be able to make the most of their partnership opportunities.

Building Better FinTech Solutions with Accusoft

Accusoft’s diverse library of SDKs and APIs allows developers to easily integrate robust content processing, conversion, and automation capabilities into their solutions. Whether they’re using PrizmDoc Suite to give their web applications the ability to natively view, edit, and convert documents, extracting data from multiple form types with FormSuite for Structured Forms, or building image cleanup, OCR, and PDF annotation features into their on-prem applications with ImageGear, FinTech companies can trust Accusoft to help them overcome the challenges of 2021 and the years to come.

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Financial Services Technology Trends: Disruption, Change and Opportunity

By Charlie Burgess Posted on February 10, 2021
Categories: Accusoft, Sponsored

This is a sponsored post from Accusoft.

Accusoft researched several of the factors driving technology and innovation in the financial services industry to better understand the current and future role of FinTech in the marketplace. Find out what they learned, discover assets that can help you solve your content processing, conversion, and automation challenges, and learn more about their FinTech solutions >>

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Through the Pandemic and Beyond: Overcoming Data Management Challenges in Capital Markets

By Charlie Burgess Posted on February 1, 2021
Categories: Sponsored

The below is a sponsored post, from Gold Sponsors of FinovateEurope Digital 2021, InterSystems.

The COVID-19 crisis has thrown a spotlight on the inefficiencies underlying many functional areas of financial firms and caused executives to reevaluate operational resilience in light of increasing volumes and volatility. There’s been a lot of industry discussion about the potential of Machine Learning and Artificial Intelligence (AI) to tackle challenges ranging from regulatory change management to improving the client experience.

AI has huge potential to augment and transform current market practices, but organizations need to make sure they are laying the groundwork for successful implementation by considering the underlying data infrastructure required to turn these technology ambitions into reality.

In this white paper, Firebrand Research discusses how to tackle the complex issue of data management and shares key reasons to invest in a smart data fabric, including:

Building the data foundation for next-generation initiatives
Enabling a firm to adapt to volatile markets via real-time analytics
Connecting and harmonizing data on demand from across a firm’s many silos
Keeping firms out of the regulatory hot seat by ensuring high data quality
Providing accurate and real-time insights and new innovative services to keep ahead of the competition

Read the full whitepaper here >>

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Puerto Rico: An Attractive Location for Startups & Established Tech Companies

By Charlie Burgess Posted on December 17, 2020
Categories: Finovate Global, Sponsored

The below is a sponsored post by FinovateFall Digital exhibitor, Invest Puerto Rico.

Puerto Rico is poised to become the global model for how to roll out cutting-edge tools that enable blockchain, AI, and the Internet of Things (IoT). All of these technologies are designed to transform nearly every sector, notably financial services, bioscience, and aerospace. Technology represents the changes imminent in the 4th industrial revolution. Proper implementation and growth of these tools has been a critical priority contributing to the island’s economic diversity, development, and competitiveness.

Network

Advances in these fields would not be possible without a supportive Information & Communications Technology (ICT) network. As an island, Puerto Rico depends on its ability to communicate with the world to do business. As such, companies benefit from extensive island-wide 5G, broadband access, established LoRa network capabilities, and broad satellite connections. Every element of this network ensures producers are connected to suppliers, customers, and business partners. Puerto Rico’s tech expertise and nationally unique international banking policies—along with the growing demand for effective financial solutions and resources—has led to a boom in innovative fintech and investing services that extend to every industry.

Fintech

Fintech is growing fast, at a rate of 25% per year through 2022. Puerto Rico’s close proximity to the world’s financial center – New York City – gives island-based fintech firms the opportunity to remain connected while taking advantages of key local benefits such as STEM talent, local financial literacy, and attractive tax incentives. Puerto Ricans are open to technology providing financial solutions where traditional banks do not. Here are a few facts you might have known about the island.

In 2017, Puerto Rican firm Evertec was the #1 provider of payment processing services in Latin America, exporting financial services to 25 countries around the world
After just four years, Evertec’s money transfer platform, ATH Movil, reached over 1 million users, 6,000 businesses, and 80% of banks and credit unions
Banco Popular’s digital platform also leads the industry in the implementation of fintech solutions
Abexus Analytics identifies commercial lending solutions to SMEs as one of the key areas of opportunities in Puerto Rico’s fintech landscape
Among others, Act 60 applies to financial activities and export services. IFEs are eligible for 6% income tax rate on distributions to resident shareholders or members and are 100% exempt on distributions to nonresident shareholders and members

Innovation

Puerto Rico also leads the region in fintech innovation, and this is evident in the wide use of digital banking tools, mobile financial applications, and globally recognized payment processing technology. Banking with digital assets is quickly becoming a reality and the blockchain community is pushing innovations for tax credit trading and how to sell utility tokens within tax incentive regulations. The island is leading the way in helping fintech, insurtech, and blockchain become more ubiquitous. The local financial services industry is perfect for global companies and start-ups looking for a cost-effective domicile or fertile ground to develop ideas, scale, and expand into neighboring markets.

The Only Place

Combine U.S. federal regulations and exemptions with local tax benefits and operating incentives, and you get the only place for international financial entities and insurers on U.S. soil: Puerto Rico. The island offers companies experienced banking and insurance markets, with a broad base of financial experts in U.S. and international laws and regulations. Puerto Rico stands to be an international leader in the finance and insurance industries by providing banks and insurers, companies, and individuals unparalleled access to the U.S. market with global regulations.

Puerto Rico is the nexus of opportunity. Contact a member of the Invest Puerto Rico Business Development team to learn how you can locate your startup or established business to the island.

Leading the way in strengthening the island as a world-class business destination is the newly formed Invest Puerto Rico (InvestPR), a non-profit investment promotion organization created by law, via Act 13 – 2017. InvestPR’s mission is clear: promote the island as a competitive investment jurisdiction that attracts new business and capital investment to the island. Our vision is to be a transformational and results-oriented accelerator of economic development in Puerto Rico.

Photo by Tatiana Rodriguez on Unsplash

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Fintech Digital Transformation Challenges During COVID-19

By Charlie Burgess Posted on December 7, 2020
Categories: Accusoft, Sponsored

The following is a sponsored post by Tracy Schlabach, Senior Manager, Product and Customer Marketing, Accusoft.

Digital transformation has been on the radar of most financial institutions for years. In a 2020 Digital Transformation Survey by BDO of financial services professionals, 68% of respondents in 2019 saw a growth in revenue directly related to digital investments. While many have made digital transformation a priority, some have faced roadblocks including risk-aversion and lack of corporate sponsorship.

With COVID-19 sweeping the globe, priorities are shifting, emphasizing the need for digital transformation. As noted in a state of the industry report authored by the Institute of International Finance and Deloitte, “COVID-19 has generated leadership and organizational support by highlighting the need for digital transformation as a means to reach customers and maintain operational resilience.” Of those surveyed by BDO prior to the COVID-19 outbreak, 36% see industry disruption as the primary digital threat. In addition, a recent survey by IDG Research states that 59% of respondents are seeing an acceleration of digital transformation in their companies driven by the pandemic.

Now that implementing the digital strategy has taken center stage on the fintech roadmap, developers are looking to meet the needs of leadership as well as customers and employees in a timely and budget efficient manner.

What Is Digital Transformation?

The name digital transformation embodies a wide assortment of initiatives, from the customer engagement experience to transforming legacy systems. In an article by The Financial Brand, financial executives were asked to select their top digital transformation priorities for 2021. Out of the long list of initiatives, four of the highest priorities are:

Improve Customer Experience
Improve Use of Data, Analytics, and AI
Enhance Innovation Agility
Improve Back Office Efficiency

Financial institutions are prioritizing several diverse initiatives to remain relevant during the global pandemic. Project managers need to shorten development time, meet executive mandates, and launch products that significantly improve the employee and customer experience.

SDK and API Integrations Streamline Fintech Development

Development teams can effectively meet those timelines by partnering with software manufacturers who build and maintain software development kits (SDKs) and application programming interfaces (APIs). Developers can integrate these SDKs and APIs into their product offerings to add unique document processing capabilities. By partnering with a high-tech software solution, your team can save development time, shorten sprints, and reduce maintenance cost. While these are significant benefits, partnering and integrating third-party software manufacturers come with many advantages, including the ability to:

Remove the burden of building and maintaining extensive document processing libraries
Access the manufacturer’s support and engineering team who can assist with implementation and resolve issues
Significantly reduce time to market of your product

Let’s take a deeper look at each of these advantages.

Integrate vs. Build & Maintain Document Processing Libraries – Consider how many different file formats are available in the market for submitting data to financial institutions. Fintech users receive everything from Word documents to PDFs to images taken with cell phones. All of those file formats need to be taken into consideration when building a fintech application that streamlines the process of capturing data from those files. Building out libraries of code that can address every possible option is extremely cumbersome and time-consuming. However, developers can leverage an SDK or API that has been developed specifically for document processing and open up time to focus on their core competencies.

Access to Support and Engineering Experts – When financial institutions embed third-party document and image processing solutions, they are also gaining access to a team of experts. At Accusoft, each customer has access to technical support and product developers that have helped hundreds of companies with implementing and utilizing these document processing SDKs and APIs. Digital transformation is a pressing concern for financial organizations. You can help them meet their needs with our SDKs and APIs. Get this new functionality up and running quickly in your application so your developers can focus on more mission-critical tasks.

Reduce Time to Market – As noted in the report by BDO, “Most financial services companies anticipate high returns on revenue and profitability from digital transformation.” Project managers that prioritize research and implement third-party software solutions can significantly reduce the time to market. This, in turn, will allow their company to realize profits faster than their competition.

With the recent changes in the world, the need for digital transformation is not slowing down. Financial institutions that prioritize those initiatives and research ways to develop and implement their new offerings quickly will be ahead in realizing revenues and returning profits to shareholders.

Accusoft is a software development company specializing in content processing, conversion, and automation solutions. From out-of-the-box and configurable applications to APIs built for developers, we help organizations solve their most complex content workflow challenges. Our patented solutions enable users to gain insight from content in any format, on any device with greater efficiency, flexibility, and security. Visit us at www.accusoft.com

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