Nigel Frith, vice president of financial services at AskTraders, discusses how challenger banks have revolutionised the banking industry and the opportunities more traditional banks can explore as they aim to extend their digital offerings.
As the high street has evolved in order to meet the changing needs of consumers, retailers have been left with no option other than to reinvent themselves. The banking industry certainly hasn’t been immune to these shifting trends either and as a result, over the last few years traditional banks have been forced to adapt and change the way they operate. While their face-to-face services still remain a crucial string to their bow, banks have had to invest heavily in their digital offerings in order to compete with increasingly popular digital-first providers. So, why are these challenger banks such as Monzo and Starling so attractive to customers and how have the big players in the industry risen to this digital challenge?
With their chic apps and personalised offerings, new banks can’t be found on the high street but are instead on your mobile phone. Their customer-centric approach has simplified banking by providing users with features which make daily tasks that little bit easier. From being able to split the cost of meals with friends to keeping track of monthly outgoings, these app-based services have really hit the spot in the eyes of many.
With more than four million customers, Monzo is perhaps the most well-known challenger bank. It started out in 2015 as a prepaid card that could be topped up via its app before transforming into a sole banking brand in 2017. It offers all of the usual current account services regular banks provide but also enables customers to manage their money in an effective and efficient manner. The ease at which you can navigate through the app is certainly a big draw for digital-savvy youngsters who are able to quickly transfer money to their friends and set monthly budgets.
In recent years it has continued to broaden its services such as by adopting a ‘get paid early’ feature which allows users to be paid their salary or student loan a day early. By embracing a channel-based communication model, Monzo has also been able to respond to incidents such as outages in a typically effective fashion. Customers can report any issues using a chat service on the app and they have the ability to freeze a card from their phone should they lose it.
With their chic apps and personalised offerings, new banks can’t be found on the high street but are instead on your mobile phone.
Another major benefit of banking with Monzo and many of its other app-based competitors is that it doesn’t have any foreign transaction fees for spending. It has therefore become a highly attractive option with regular travellers and holidaymakers alike.
Although recent analysis of bank branch data has revealed that (if the current rate of closures was to be maintained) there would be no high street banks left by April 2032, there is clearly still a demand for in-person banking. Many people still feel more comfortable going into a bank to pay-in cheques while others are reliant on the financial advice they can access in-store. Clearly there remains a need for traditional banks, such as the big four in the UK - Barclays, Lloyds Banking Group, HSBC and RBS - to evolve their offerings.
In recent years, therefore, these banks have invested heavily in their online and mobile banking services in a bid to compete with digital-first providers like Monzo. This has included providing customers with perks such as being able to pay for purchases using virtual cards on their apps and providing them with the ability to cash-in cheques from the comfort of their own homes.
Leading the way has been Barclays who in 2017 invested £4,148 million into their digital platforms. Now, more than 90% of Barclays’ transactions take place over mobile devices, emphasising the effective nature of their transition to a more digitally-focused way of operating. In December 2018, Barclays also designed a feature which allowed customers to turn off payments towards certain websites should they feel they are unable to curb their spending. More recently, it has taken things a step further by enabling users to view the accounts they hold with rival banks on their platforms - an option which would have been unthinkable a decade ago.
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Key to ensuring customers have felt comfortable transitioning to these digital services has been the commitment banks have shown towards tackling cyber crime. This has seen the banking industry team up with the government, police and other regulators in recent years. Initiatives have been set up to not only raise awareness of the threat scammers pose but to also reassure customers of the stringent measures banks have in place to protect their personal data. Last year, UK banking security systems prevented fraud on an estimated £1.4 billion scale, demonstrating the importance of their investment into tackling cyber crime.
With banks now constantly innovating in a bid to steal a march on their competitors, it is likely we’ll continue to see big changes taking place within the industry over the coming years. One thing that is clear though is that there will be a continued drive by providers to further improve and simplify the customer experience. Although further high street branch closures are inevitable, banks are working hard to maintain their in-person services for those who prefer to operate in this capacity also. While digital banking isn’t for everyone, the ease and efficiency at which millions of people can now complete financial tasks has left a lasting impression on many.
Georg Ludviksson, CEO & co-founder of digital banking solutions provider Meniga, tells Finance Monthly why banks' most important innovation focus must be to help customers build 'financial fitness'.
People across the globe are experiencing new and uncertain circumstances for their personal finances, whether through unemployment, business closures or the sheer impact of the economic recession. One thing is certain, however: that healthy financial habits have a new pertinence in our society and for many, their first port of call to achieve this will be their bank.
We have entered a critical point for the banking industry, where it is now absolutely crucial for banks to step up their innovation game to support their customers in a personalised and engaging manner through digital channels.
It is impossible to predict exactly what the financial ramifications of COVID-19 will be. However, we shouldn’t expect this pandemic to be a short-distance sprint but rather a marathon, and for this, banks need to be there for their customers to ensure that they are financially fit - or they will start training with somebody else.
Banks need to stay ahead of the curve by turning to digital channels and preserving the financial wellbeing of their customers
The personal finance landscape, specifically the way in which people make sense of their finances, has evolved tremendously over the past decade. In particular, there has been a shift in consumer behaviour whereby the demand for personalised services has increased dramatically, and people have become more critical of the banks that fail to help them lead healthier financial lives.
The personal finance landscape, specifically the way in which people make sense of their finances, has evolved tremendously over the past decade.
People no longer view banking as a purely transactional and one-dimensional functionality, but rather as a full-service experience helping them take control of their finances and achieve financial wellbeing. This shift in consumer behaviour and the increasing association of good financial habits with positive health and wellbeing also explains why the notion of ‘financial fitness’ has gained recognition within the personal finance landscape over the past few years as a term describing one’s increasing desire to feel good and confident about one’s financial situation.
The last few years have seen an increased prevalence of digital banking and a plethora of more personalised tools which suit the shifting needs and wants of consumers. The rate of digital banking adoption has also been significantly accelerated by the pandemic.
Research by deVere Group found that the use of fintech apps in Europe rose by 72% in March 2020, whilst a McKinsey study found that the pandemic has accelerated the shift to digital banking by two years. In particular, the latter study found that online bank use rose in most European countries, from a 7% increase in Italy to 19% in Portugal, and that more than 20% of customers in Spain and the UK tried online banking for the first time during lockdown.
As both digital banking and financial health have gained increasing significance in 2020, it highlights the urgent need for banks to view their digital channels as a strategic asset and start re-prioritising their resources to focus on developing personal finance management (PFM) services and the financial self-help tools their customers need. If not, they risk losing significant market share to the challenger banks, who already excel in user experience and have digital leadership in their DNA.
The last few years have seen an increased prevalence of digital banking and a plethora of more personalised tools which suit the shifting needs and wants of consumers.
Becoming your customer’s financial personal trainer and drawing upon the health and fitness world when developing PFM services
In a global financial crisis, a bank’s underlying mission statement should be focused around helping their customers lead healthy financial lives. By instilling financial fitness into the organisation’s mission, banks will be able to truly prioritise developing PFM services, and thus provide their customers with the support they need to take ownership of their financial health.
In fact, when developing PFM services, banks should consider studying what makes health and fitness apps so addictive. The popular fitness app Strava uses all kinds of features and gamification to keep users engaged and to encourage them to take control of their own health, from social activity feeds, to weekly targets and personalised nudges.
In a way, physical health is very similar to financial health, it’s about building the right habits to positively impact your fitness and wellbeing. Banks should analyse what makes fitness apps successful and replicate some of their gamified features and elements of their design to develop user-friendly banking apps which can be comparable to personal finance coaches and which focus on helping customers achieve goals and build healthier habits.
Ultimately, the main functionalities of a digital banking app must on one hand be to ensure it delivers the right information to customers through features like spending reports and automated budgeting, and on the other, enable customers to build better habits and stay in control of their finances. The latter can be achieved through financial gamification like savings challenges, or other features including personalised nudges and notifications, social media-like activity feeds, cash-flow assistants and personalised cashback rewards.
One bank that has done particularly well to create personalised banking solutions for their customers is Portugal’s Crédito Agrícola. Like many other European banks, Crédito Agrícola has been facing rapidly growing competition from challenger banks like Revolut and N26, but by bringing their own digital innovations to market they have been successful in maintaining their position as one of one of Portugal’s most reputable banking groups.
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In September 2019, Crédito Agrícola collaborated with Meniga to launch one of Portugal’s most popular digital banking apps, “moey!”. The moey! app relies on Meniga’s technology as an engine for categorisation and enrichment, to provide customers with a more immersive and interactive experience. The app enabled Crédito Agrícola customers to, firstly, stay on top of their finances through a number of informative features, such as insights, reports, budgeting and financial planning; and secondly, be encouraged and motivated to build and maintain healthy financial habits through a feature that is, in many ways, the foundation of all fitness apps: the ‘Activity Feed’. The activity feed is a functionality that enables banks to engage with their customers through personalised messages such as insights, advice, fun facts, targeted rewards and product recommendations.
The results were almost instantaneous, with over 130,000 app installs in the first 6 months after launch. Crucially, the app enabled Crédito Agrícola to increase its user engagement, with 90% of transactions being made via the app and more than 50% of moey! customers now active users.
By drawing upon the health and fitness world and understanding what functionalities engage users and encourage them to take control of their own health, banks will be able to develop banking solutions which provide much-needed support during this pandemic and help them build good financial habits.
The dependency of people on their banks has never been stronger, and banks now have a real opportunity to maintain the loyalty of their customers and stave off competition from the challengers. To succeed, they need to recognise the importance of shifting their value proposition and core product offering to focus on elements of digital banking, financial fitness and personal finance management.
Ketan Parekh, Managing Director for Financial and Insurance Services at Fujitsu UK, comments on the emerging trends of the payments marketplace.
Digital wallets were already on the rise, but COVID-19 has accelerated this transformation. Consumers have been encouraged to limit contact by purchasing digitally, leading to changes such as an increase in the contactless spending limit.
And as digital and contactless payments become normalised, the move away from physical payments will happen seamlessly. It’s estimated that about a quarter of UK citizens will make at least one payment via a smartphone in 2023 – a figure that is only set to rise as time goes on. The UK may just be taking baby steps towards a digital-first future in banking.
People are more digitally savvy than ever. Therefore, slick payment experiences are not viewed as a luxury but are expected. And the speed and convenience that a digital wallet provides has always been an attractive proposition.
In fact, our research found that while security concerns were a key reason for consumers not adopting digital banking services, nearly a third (29%) of British consumers said they prioritise speed over security when it comes to completing transactions or transfers. Therefore, it is important that digital wallets are developed with security front-of-mind.
And many modern digital wallets already do provide good security. Biometric payment verification, used on most smartphone devices, is a much more secure way of paying than contactless on a credit or debit card.
While biometric credit cards are being developed by some banks, smartphone digital wallets provide ready-made fingerprint and facial recognition technology, which limits the risk of fraud and theft.
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Organisations need to take note of the shift in consumer attitudes towards digital wallets if they want to be at the forefront of the transition – especially as there’s an increasing opaqueness in who is providing the payment services with many digital wallets. Take ApplePay: as a consumer you may see your bank’s name on the screen, but the Apple phone is, in fact, making the payment.
This allows these companies to benefit from the underlying customer data they receive, giving them a chance to control the payments marketplace.
Indeed, the rise in digital wallets has led to new, non-traditional players entering the finance industry. Apple has created its own credit card, while Facebook is still looking into developing a cryptocurrency and digital wallet on the platform – just two examples of how tech giants have entered the market.
Traditional banks should remain aware of this new competition. They command consumer trust – with over a third (36%) trusting them entirely but that does not make them invincible and new challengers will continue to emerge. And while new players don’t yet control the payments marketplace, there is certainly the potential for them to take the lead.
The market is about to become more convoluted than ever. And as wallets move increasingly digital, consumers may begin to go with the service that provides them with the best digital experience, over those they trust the most.
Before COVID-19, banking was already transitioning from traditional payments to a digital-first means of spending. The pandemic has only accelerated that shift. And as consumers get more comfortable with spending via digital wallets, banks will need to consider how they are supporting the technology if they are to deliver the experiences that customers are demanding.
Digital sales from outlets like Target enjoyed an unprecedented 275% growth in recent months, according to the US Census Bureau. It seems that this is not an isolated case as businesses, especially ecommerce companies, are experiencing the same growth. With global currencies having taken a hit during the pandemic, it was uncertain as to what direction fintech would take. As it turns out, the world is now sprinting toward financial inclusiveness and eCommerce diversity.
Prior to the pandemic hitting, online transactions with cash-on-delivery (COD) options were highly popular for consumers around the globe. This, however, is no longer feasible in places like India and China where COD options are now disabled in order to minimise risk moving forward. As such, new avenues were needed and fintech answered the call. Fintech has long been regarded as a great enabler of financial inclusion by providing a reimagining of business models and processes, according to the World Bank. They believe that it is through fintech that suitable alternatives to COD will be found like crowdfunding, cashless transactions, and even peer-to-peer lending options.
While ecommerce is not a new concept in the fashion industry, consumers are now more discerning, especially about diversity and inclusivity. Nearly 34% of respondents in an Adobe survey said that they boycotted a brand due to a lack of diversity in advertising, while another 61% said diversity is the key to good advertising. This isn’t surprising, as high fashion brands have had their share of controversies like D&G’s “Eating with Chopsticks” or Gucci’s balaclava jumper. As such, fashion brands that are enlarging their ecommerce presence are actively reforming their advertising and marketing to emphasise inclusivity, accessibility, and diversity. One method that fashion eCommerce is trying out is redesigning their websites to be more accessible to a wider audience. Another is using a diverse sample of models for visual ads on their ecommerce platforms.
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A survey by Merchant Savvy found that nearly 70% of all eCommerce is conducted through mobile phones. While that number is high, retailers report that conversion rates vary as consumers still express concerns over security and user experience. In worst-case scenarios, not even 1 out of 10 successful transactions occurs via mobile phone. To combat this, brands are aiming to develop hybrid apps to work well with browsers as regular apps take up too much memory on devices. There is particular emphasis on making phones a universal digital wallet for frictionless and seamless transactions. This, however, requires better security, infrastructure, and devices capable of supporting the whole concept. As such, more mobile phone eCommerce development is being planned by large brands like Amazon, Apple, and others.
With the world impatient to move on from the effects of the pandemic, the fintech industry is striving to make sure that they have what it takes to meet demand. The upcoming months can expect a lot of additional emphasis on financial technology development. With eCommerce now the norm in transactions, it is exciting to see how else financial inclusiveness, diversity, and online transactions shall take root and bloom.
Yaela Shamberg, Co-Founder and Chief Product Officer at InvestCloud, offers Finance Monthly her insight on how wealth managers can engage investors with digital solutions.
As wealth managers face the pressure of the race to zero fees in an increasingly competitive marketplace, they are looking for ways to mitigate these threats while simultaneously preparing for the oncoming wealth transfer. Recent research from IQ-EQ has revealed that $15 trillion USD is to be passed to Millennials, Gen X and Y in the next decade – triggering a new era of high net worth individuals (HNWIs) who are digital natives that expect online wealth management portals with cutting edge tools.
Digital advice tools for HNWIs have been available for some time, but few have proved ideal for this client base. This is because wealth managers are asking the wrong questions. When it comes to finding suitable digital tools, they are looking for a one-size-fits-all digital solution, when in truth, they would never think to offer an impersonalised service to clients offline. What they need are solutions that enable the same level of personalisation and understanding to the individual that they would provide face-to-face – creating true digital empathy.
Those who have been successful in their digital transformation are achieving this by developing multiple ‘digital personas’ that provide their clients with individual experiences and functionalities which speak to their characteristics and goals. This improves the client-manager relationship, as the client feels they are receiving a more tailored service that allows them to interact with their wealth in the ways that they want to. The number of personas one offers may differ depending on how much a firm wants to invest in developing digital experiences, and the diversity of its clients. Nevertheless, the requirements of HNWIs can be roughly split into three personas, which must be catered to at a basic level.
Those who have been successful in their digital transformation are achieving this by developing multiple ‘digital personas’ that provide their clients with individual experiences and functionalities which speak to their characteristics and goals.
The hands-on investor requires a self-select persona. They know about the financial markets and want to be involved in the investing process. Some may even want to make all of their financial decisions independently. For this demographic, tools to browse, research and self-select their chosen investments are crucial – enabling them to build their own models and feel involved in their investment process.
But this does not rule out the wealth manager. They must curate investment options, enabling the investor to filter through them by topic, trend or through insight into what their communities are selecting. Communicating with this type of persona must respect their mindset and preferences, by being on their terms. Having a variety of channels available such as chat, video calling and voice memos, enables the investor to choose how and when to interact with their wealth manager.
The life planner needs to be catered to with a goals-based planning persona. To them, investments are a means to a very specific end – and they need a holistic service that takes into account their entire financial wellbeing. This means managers must pay close attention to their clients’ investment goals and understand exactly what they want to achieve and why. This breaks down to understanding their goal funding, their risk tolerance and a number of other factors.
This begins with empathetic discovery – meaning digital workflows that clarify investment goals including questionnaires and capturing total assets and liabilities, income and expenses, projecting cashflows and applying stochastic models. Once onboarded, the wealth manager needs to be constantly communicating with the client so that they can keep track of their progress as they approach life goals. They also need digital tools that help them visualise their progress such as charts and trackers.
Once onboarded, the wealth manager needs to be constantly communicating with the client so that they can keep track of their progress as they approach life goals.
There are absolutely still those who fall into the client segment that tend to prefer a “white glove” service from prestigious wealth managers and therefore require a traditional persona. These clients are typically ultra-high-net-worth individuals (UHNWIs) who require greater assistance from their wealth manager when choosing investments, and like these to be laid out in formal proposals.
These clients need a high level of customisation, which can be time-consuming. Digital advice builder tools come into play here as they enable automation, giving the wealth manager the ability to tailor portfolios to the client’s short and long-term goals and thematic interests quickly and efficiently. This frees up time that the wealth manager can now spend focusing on maximising profitability and tasks that add value. Then, these portfolios can be presented in the form of beautifully designed proposals which demonstrate greater empathy for the client’s preferences.
Providing a wealth management service through the medium of tailored personas is a digital engagement strategy that enables greater digital empathy. But once the wealth manager has made this personalised service available, how can they make it ‘stick’ and keep clients coming back to their digital portals?
One way managers can keep clients coming back is by deploying gamification principles throughout the client experience – through which we can encourage greater and more active participation by implementing progression dynamics and establishing communities to help investors progress and learn. This is particularly useful for the self-selecting investor as it keeps the wealth management firm front and centre without being unnecessarily high-touch.
It can also be used to encourage positive behaviour from life planners, who can track their progress and be ‘rewarded’ when they enter useful information or complete certain actions within a desired timeframe. Establishing a community also enables them to gain insights into how their peers are progressing with their own investing goals. Keeping clients engaged in this way translates to longer-term loyalty, which in turn means greater profitability for the wealth management firm.
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For wealth management firms already using digital advice tools for other client segments, these can easily be expanded upon for HNWI demographics. Through a combination of personalised personas and behavioural science techniques to encourage loyalty and build trust, managers can service clients more effectively whilst taking advantage of automation that frees up time to take on new clients.
Regardless of investor types and personas, the future of digital offerings – for all – is here and with that comes a need to deploy digital empathy, tools and advice which enrich client lives. The use of thoughtful digital advice, seamlessly integrated into client portals and intuitive mobile apps, brings opportunities to uplevel client offerings, and match the premier services and tools they've come to expect from their wealth managers.
APIs allow us to make payments seamlessly, reaching the global marketplace at our fingertips, by transmitting information from one piece of software to another.
But as APIs become increasingly part of our day-to-day transactions, how can we make sure they are the best fit for the service users and that they do not fall into the trap of prioritising style over substance? Finance Monthly hears from Henry McKeon, Innovation Architect at moneycorp.
For incumbent banks, APIs give the opportunity to expand their customer reach, by offering a more accessible range of services, along with potential partnership opportunities with fintechs. However, due to the business model of the bigger banking institution, they are inherently less agile than their fintech counterparts, meaning they often come up against barriers in the development of their API offerings.
On the other hand, we see a number of fintechs who rush to get their API service to market in order to serve their customer base – who are more likely to be tech-savvy. And while they have an agile business model that allows then to be flexible in adapting customer solutions, they don’t have the heritage and pre-built trust with the general public, along with the years of customer feedback to implement into their systems.
Fundamentally, a successful API has the customer at the very core. In the first instance, it’s vital that the provider looks at the specific customer requirements and relates those needs directly to the API services. Working closely with end customers helps to provide a better understanding of customer requirements and helps to structure the API offering. In building an API offering, developers should look to engage a number of existing customers to understand their requirements and to offer the functionality that would service clients across a wide variety of industries and needs.
Fundamentally, a successful API has the customer at the very core.
Some customers need efficiency in order to operate at scale; keying payment transactions manually via a web portal doesn’t scale and is error prone. Mass payment file processing provides efficiency and reduces errors but is not always what our high-tech customers are looking for. They want open API services so that they can link their platform directly to payment and foreign exchange services, they want to drive transactions from their own platforms directly. Having the ability to access services via API instead of via files provides the ultimate flexibility.
Building a central set of API endpoints, which provide the core banking on a multi-currency wallet, global and local beneficiary validation, international payment capabilities, peer-to-peer facilities for instant transfers, and 24/7 multi bank dealing and transactional and statement capabilities is part of the core requirement which help service customer needs.
The diverse needs of the customer journey are put into perspective when looking at invoice factoring customers who service short term debt. They need strong banking facilities for receiving and auto-allocating incoming money. Receiving is a key part of the banking offering, so doing that quickly and across a multi-currency account is a core part of our offering. Having account tiering (Parent-Child segregation) also helps with segregating money and reconciliation.
Invoice factoring companies need efficient pay out capabilities, for paying suppliers (early) and paying back to investors at the end of the agreed term. As a result, the ability for an API to provide speed, global coverage and multi-channel capabilities are crucial. Building receiving information into the API, providing instant access to balancing and received funds, along with the referencing on incoming money therefore becomes a fundamental requirement. This allows customers to understand the source of the money, so they can do checking an allocation on their own platform.
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Freelancing companies are another good use case for APIs. By their very nature, they are collecting and paying consultant salaries and need to be able to capture consultant bank details accurately and securely. In addition, they want to be able to validate these bank details at the point of capture, instead of at the point of payment, in order to avoid any errors or delays. Having the ability to validate local and global bank routing information at the point of entry using an API is a big advantage. Having a validation rules engine enables clients to dynamically configure the capture screens on the source freelancing system. In showing the mandatory banking fields required for each country and currency, it provides clarity on the required fields and validation of the banking details captured as part of the API offering. This functionality fundamentally helps eliminate payment failures, reduce rework and costs in the payment process.
When working with clients running freelancing sites, you’ll often find that they also require FX conversion and payment facilities which need to be embedded into the API to facilitate global pay out requirements. Local payout facilities also help reduce costs of transmission and receipt, as sending through expensive international channels is not always suitable.
This is also echoed in the requirement for shipping companies, that need to be able to pay efficiently for port calls globally. Having access to a wide range of international payments routes and currencies is essential to provide a full service. For example, at moneycorp we have partnered with Inchcape Shipping to provide Smartpay which services the world's maritime industry. Smartpay simplifies the payment process, providing efficiency and transparency and helping to centralize treasury and FX and payment services for the group.
In the fast-evolving world of API solutions, style is impossible to achieve without substantive attention to detail. This is even more apt in the space of foreign exchange, where achieving speed, efficiency and security can be more of a challenge due to the nature of banking across borders. In this space, to be successful, an API needs the agility of a fintech to evolve to rapidly changing consumer needs but be backed by substantive banking networks and expertise to execute payments securely and quickly across currencies, markets and time zones.
In the past it was only banks and legacy money transfer agencies that undertook the international transfer of money. The advent of the digital age has, however, enabled a slew of new age international money transfer companies to offer these services at excellent terms.
Quite a few of these international money transfer companies have earned a reputation formidable enough to place them among the top, as MoneyTransfers.com reveals. Let’s look at some of them and examine what makes them the very best among international money transfer companies.
This service works out great for those who are sending money abroad for the first time, what with their convenient way of enabling the money transfer, as well as the attractive rates offered to new customers. They offer an express service that enables an international money transfer in four hours’ time as well as an economy version that takes 3 to 5 business days for a transaction to be complete. The fee charged for each service is, of course, commensurate with the delivery timeline.
TransferWise has earned a creditable reputation for itself as both an economical and efficient enabler of international money transfers. Both their exchange rate and upfront fee are quite attractive, making them a very popular choice for people seeking to transfer money abroad cheaply. Besides, there are no upper or lower limits on the amount of money one can transfer. Their user friendly app and website make an international money transfer a breeze.
They have been around for two decades and are known to not charge anything for transferring money abroad. Their ability to transfer money within 24 hours in the case of 80% of the world’s currencies. They are quite a popular service in the UK, Australia, Canada, Hong Kong, New Zealand and the US.
They are an extremely popular international money transfer company on account of the excellent terms they offer, as well as their customer service, which is out of the top drawer. Their rates too are quite good, especially when compared to banks.
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This is another very popular international money transfer agency known as much for their better-than-bank rates, as they are for the many accolades they have gathered over the years for their stellar services. It’s not for nothing that they have been designated UK’s International Money Transfer Provider for the years 2016, 2017 and 2018. You can even transfer amounts greater than $2500 via phone instructions to the personal account manager, as also online.
Again,this international money transfer agency is a much awarded one, having been nominated as the Money Age award winners for the years 2016, 2017 and 2018. They don’t charge a transfer fee and enable international money transfers quite conveniently via online, phone and app. Their popularity can be gauged by the fact that they have as many as 325,000 customers.
This is quite a popular international money transfer service on account of the fact that they are known to be very user friendly, safe and secure. You pay nothing for opening an account with them and they charge nothing for enabling an international money transfer either. What’s more their exchange rates are very competitive, which you can avail of through your personal account manager or via a 24x7 online account. It’s not for nothing that they are the recipients of the Feefo Gold Trusted Award.
The international money transfer service market is truly a buyer’s market where one gets to choose a service provider based on how best they can serve your interest. All you need to do is to take the trouble of finding out which one of the many offers you receive is the right one for you.
This industry has never been noted for leading technological progress. Its reliance on paper-based processes, even among the larger, better-resourced firms, is well known. Unfortunately, these technological shortcomings have been exposed in stark fashion as the COVID-19 pandemic forces most companies to rely on remote working and communications. This extreme stress test has made even some of the larger real estate companies realise their digital capabilities are woefully inadequate.
In particular, the crisis has revealed the poor quality of networks at many real estate companies and the low priority often given to data security and protection. This lack of security has even led in some cases to the ‘free’ software they use tapping into the data of users for advertising purposes. ‘Cookies’ and spyware can automatically collect individuals’ shopping and viewing habits via search engines to better direct adverts that provide revenue, raising concerns about organisations’ own levels of privacy and security, too.
Essential steps to digitalisation
If real estate companies are to take on board the lessons of this crisis and successfully modernise their digital systems, then they must:
Recognition of these challenges and appetite for change is certainly prevalent in the industry. New research commissioned by Drooms1 found that two thirds (67%) of real estate professionals say their organisations’ efficiency would increase if their systems were to have seamless integration with third-party platforms that give them access to a variety of functionalities. Nearly a third (32%) believe this improvement would be ‘dramatic’.
API offers a seamless integration solution
A leading-edge solution for achieving seamless integration is an Application Programming Interface (API), which enables the interconnection of software systems and data between businesses and third-party providers, representing a major step forward in streamlining workflows. Nearly two in three (65%) respondents in our survey nominated APIs as the IT feature they would most like to see incorporated into the tech they use, versus 29% who cited ‘security’ and 15% ‘blockchain’. More than half (59%) of real estate professionals would like to see APIs improved, ahead of other tech features, such as security (41%).
Drooms has opened up its API to its clients, meaning they can seamlessly integrate their VDRs with a range of software systems. These systems include real estate market analysis software that enable clients to consolidate fragmented data and make immediate comparisons of their portfolios against the wider market. This means data-driven decisions can be made quickly without having to log in and out of several systems, draw on various information siloes or work between applications.
With so many staff having to work from home across Europe, the fragility of companies’ IT networks has been exposed. It is now clear that for teleworking to work successfully then companies must implement adequate software tools. They must invest in high-functioning and secure technology that is going to optimise current workflows rather than demoralise their staff.
These tools must reduce pressure on servers, include appropriate data file sharing and storage systems, solve any issues with document formats and make data easily accessible to authorised people and teams, enabling access via a range of devices e.g. browser, app, mobile, etc. This latter function can be problematic given that the security in place inside company firewalls is completely different from that in homes, presenting a tough challenge for many companies.
COVID-19 crisis is likely to change attitudes
Many real estate companies have yet to fully address these issues. While some generic file sharing and storage systems can help companies, these can only provide make-shift solutions. For a complete and secure set-up, companies should look to specialised services, and ensure they take great care in vetting their providers.
The COVID-19 crisis is highly likely to change attitudes and focus company leaders’ minds on bringing about such changes - especially when they realise that a lockdown could be re-instated at short notice for some time, possibly even into next year.
(1) Source: Survey conducted between 28 January and 21 February 2020 by PollRight. The panel of 34 real estate investors covers both fund managers and investors across Europe.
The COVID-19 pandemic has not just had a devastating impact on health and society, it has dominated economic and business matters unlike anything we’ve seen in peacetime history, and, across the globe, schools, companies, charities and self-employed professionals are still adjusting to a brand new remote working contingency plan.
Fortunately, as a society, we are extremely well-equipped to adapt to remote working with a turnaround time of just a few days. This was proven by the sheer quantity of businesses, many of whom care for thousands of employees, who just a few weeks ago managed to transform their entire internal structure to a digital environment. Not only is this an inspiring example of human collaboration at a time of crisis but also a true testament to the power of the technology at our disposal.
In fact, remote working has proven itself so effective for some organisations, that it has gone beyond a short term contingency plan; it’s starting to look like remote, or at least flexible working, will be incorporated in the long term for thousands of office-based workers. Clement Desportes De La Fosse, Co-founder and Chief Operating and Financial Officer at Spearvest, shares his thoughts on how the finance sector will be forever changed by the pandemic.
Although it may sound premature to think about a post COVID-19 world, a majority of industry operations are sure to change forever, and, none more so than in the financial sector. For many years, traditional banks and financial institutions have been associated with outdated infrastructure and slow legacy IT systems, which are a burden for financial professionals and consumers alike. In fact, a recent study in 2019 revealed that UK banks were hit by ‘at least one’ online banking outage every day across a nine month period.
Today, the demand for banking and financial services has never been higher: emergency loans, government payment schemes and personal finance management are required for people to survive. What’s more, visiting a branch in person is no longer an option, and therefore financial institutions are forced to invest in capable IT infrastructure and relevant automation, regulation, and finance technology to deal with influx of demand.
For many years, traditional banks and financial institutions have been associated with outdated infrastructure and slow legacy IT systems, which are a burden for financial professionals and consumers alike.
Whilst it could be argued that this much-need update was inevitable, the pandemic has certainly forced many banks’ hands in enforcing this change, and means our financial institutions will emerge from the crisis with a much more capable IT infrastructure. The following areas are where banks are, or should be investing, in the coming weeks, months and years, with insight into how exactly these cutting-edge technologies are impacting the financial services sector for the better.
Artificial Intelligence (AI) has been a growing trend in finance in the past decade, primarily being used to address key pressure points, reduce costs and mitigate risks. However, the demand for digital banking services as a result of COVID-19 will likely push the sector in the direction of developing and incorporating sophisticated automation and customer service AI.
We’re a few years off the mass adoption of robotics technology of this nature, but it’s safe to say the COVID-19 threat has highlighted the pressing need for more automation and better service technology.
The shift toward cloud-based computing has already been significant, with most financial institution operating cloud-based Software-as-a-Service (SaaS) applications for business processes, such as HR, accounting, admin solutions and even security analytics and know-your-customer verification.
However, advancements being made in cloud technologies and increasing demand for SaaS applications for remote workers means that soon we could see core services in the financial sector, such as consumer payments, credit scoring and billing, to become stored and managed in cloud-based SaaS solutions.
Much like the increasing demand for AI and Cloud-based SaaS applications, regulatory technology (RegTech), can do important work in ensuring financial work remains regulated and legal. The right RegTech, such as automated customer onboarding technology, can also save a firm a lot of time, freeing-up much-needed time to focus on the work that can not be completed by software or a robot.
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Customer intelligence facilitated by big data and consumer behaviour is an incredibly important tool which can be used for extremely accurate decision making, risk-assessments and revenue and profitability forecasts, to name just a few use-case example.
Some modern financial institutions and start-ups have been using big data and analytics technology for a number of years, and those more ‘traditional’ which may have neglected this cutting-edge technology are depriving their customers of top tier financial advice and insight at a time when they are in need of it most.
Cyber attacks, money laundering and hackers have always threatened the financial services to a large extent. However, with entire workforces online, operating in a remote, sometime unsecure environment, the cyber-threat facing consumers has never been larger.
Thus, cyber-security has, and should, be invested in heavily by financial institutions looking to protect their own client, employee and company sensitive information. At the same time, safe internet and banking practice should be implemented and taught to all members of the general public to ensure they do not give away sensitive information such as payment details.
Fast forward, five years from now, we will look at the pandemic as a trigger that enabled us to spend our time more efficiently, and digital technology and the cloud will be key in facilitating this positive change.
As the Coronavirus (COVID-19) pandemic continues to spread there has been a worrying rise in harassment, bullying, and discrimination in the workplace. Initially, this was seen to be race-related - targeting people of Asian origin - but has since spread to include people who expressed symptoms of the virus. Now as large swathes of the global workforce move to a working from home model, employers are faced with a new challenge - that the vector for workplace discrimination will shift in parallel with the main mode of communication. Neta Meidav, co-founder & CEO of Vault Platform, explores this phenomenon below.
Tasked not only with rapidly implementing a company-wide working from home strategy to keep businesses that are still operational up and running, many HR functions are also operationally responsible for mass layoffs all while building a crisis information and communication plan out. Bluntly, HR teams are maxed out and will struggle to field a rising number of queries about the new workplace etiquette.
Law firm Lewis Silkin LLP estimates that around 59% of large multinational enterprises have already put into place a plan to respond to pandemic diseases such as Coronavirus. Typical measures include social distancing and remote working arrangements. The majority (88%) of are managing self-isolation by asking employees to work from home.
It’s difficult to actually get a handle on the number of people whose jobs allow them to work fully remotely, especially with such an unprecedented situation. But cloud security services firm Netskope, which routes corporate traffic for hundreds of thousands of office workers said it estimates that the number of American knowledge workers (white collar desk workers) logging in from home hit a high of 58% on March 19. This is up from an average of 27% over the last six months.
While there may be some anecdotal evidence that the untested shift to an emergency working form model is in fact working, it is early days and there is plenty of research that points to warnings we should all be heeding.
Bluntly, HR teams are maxed out and will struggle to field a rising number of queries about the new workplace etiquette.
A 2017 study by David Maxfield and Joseph Grenny for leadership training consultancy VitalSmarts found that just over half of people who work mostly remotely feel they don’t get treated equally by their colleagues. Now the obvious retort is that ‘we’re all remote workers now,’ so the playing field is levelled. But research suggests the problem is more with the medium than whether workers fall into the ‘in office’ or ‘WFH’ camps.
Some 30% of UK respondents to a survey by Totaljobs in 2018 said they had been victims of workplace discrimination on official corporate messaging platforms, such as Slack, Microsoft Teams, or Google Chat. In the US, a 2019 survey by Monster.com revealed that 39% of respondents had received aggressive messages from colleagues on similar tools.
Cyber-bullying has been well documented for some time and remains as persistent in the corporate workplace as it does in schools and colleges. A recent high-profile case focuses on the departure of the CEO of leading consumer brand Away after an exposé of bullying culture over Slack.
The revelations of Away are an anomaly - most incidents go unreported. The same studies show that 30% of workers in the UK (according to Totaljobs) and 34% in the US (according to Monster.com) who do experience cyberbullying suffer in silence because they are not confident they will be supported by their employer. Lloyds of London was exposed in December last year after their complaint hotlines were proved to be inoperative for 16 months due to unpaid phone bills, and in 2018 the Financial Conduct Authority put senior managers on notice that their futures in the City were at risk if they did not take diversity seriously, while companies faced fines after a 220% increase in interpersonal whistleblowing complaints over the previous 12 months. According to Totaljobs, around 8% find it easier to leave their jobs than to complain and request an investigation into the situation.
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Digital workers are disincentivised from reporting workplace misconduct in the same way as employees that spend all their time in the physical presence of their colleagues. Firstly, the available channels for reporting misconduct are intimidating; and secondly, they don’t feel confident their employer will act on the report.
But the fact remains that employers are legally obliged to protect their workers and that responsibility doesn’t change because they are now out of sight. While ethically, employers should take more care during these uncertain times.
This week Revolut launched what it’s calling an ‘Open Banking’ feature in the UK; an additional function within its mobile application that allows users to see their bank accounts form other providers.
Revolut partnered with TrueLayer to deliver the new feature, which has already had plenty of encouraging press. The challenger bank has made full use of the open banking environment that exists in today’s banking sphere to offer its customers something beyond the usual.
The new Open Banking feature means Revolut’s mobile banking customers can see other accounts they have, see balances and transactions and set budgeting controls that include their other accounts as well as their Revolut account.
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Joshua Fernandes, product owner at Revolut, said: “With the launch of our new Open Banking feature, UK customers can now view and manage multiple external bank accounts, enabling them to interpret their day to day spending across all of their accounts, with the added benefit of making our offering even more relevant, user-friendly, faster and more cost-efficient for our customers,” according to Finextra.
Visit the Revolut site for more information on how it works and what an API is.
Research by Triodos bank just a few years ago in 2016 indicated that over three quarters (77%) of UK adults supported greater competition from challenger banks.
According to Jamie Johnson, CEO at FJP Investment, such a confronting statistic suggests that alternative banks could offer certain opportunities that traditional banks lack. Below he shares more about the new and re-invested world of consumer finance.
Fast-forward three years, and today we are seeing floods of people opening accounts with newcomers like Monzo and Revolut. In fact, FJP Investment recently polled a nationally-representative sample of over 2,000 UK consumers and found that almost one in five (18%) have already made the transition from a traditional high street bank to a challenger bank. As one might expect, this number was significantly higher amongst millennials, with over a third (33%) claiming to have already made the switch.
The question beckons: why are UK consumers looking to challenger banks? And does this reflect a broader change within financial landscape?
Reflecting on the recent performance of the UK savings market more generally can offer valuable insight into why we’ve seen a notable rise in challenger banks. The market has undergone a fundamental shift in the last decade, particularly in the aftermath of the Global Financial Crisis of 2008 and, more recently, Brexit.
This climate of uncertainty has caused The Bank of England to be far more cautious in their decision making. Consequently, the interest rate below 1% for the past ten years, offering consumers little hope that their savings pots might grow. Meanwhile, the rate of inflation has been outstripping interest rates offered by most banks. Unfortunately, consumers are taking a financial hit, and seeing their hard-earned savings declining in value.
Indeed, the aforementioned FJP Investment research revealed that in the last 12 months alone, two fifths (38%) of UK consumers have seen the value of their savings decline.
Yet, the UK remains a proud nation of savers. Traditional savings accounts continue to be the bedrock of most people’s financial strategies, and will likely remain so for the foreseeable future: currently, over three quarters of UK adults (79%) hold some money in savings accounts. However, we cannot ignore the changing attitudes that have taken the market by storm – consumers are increasingly shopping around for alternatives that can better match their needs. Many are turning in the direction of challenger banks.
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Startups like Monzo and Revolut are undoubtedly revolutionising the banking experience, with forward-thinking features and sleek app design proving to be increasingly popular among younger generations of savers. But apart from the attraction of a well-designed app, what else do challenger banks bring to the table?
For one, challenger banks typically offer better rates – of Britons who have joined digital-only banks, or intend to in the next five years, almost a third (31%) say this is why they made the decision. Other advantages, which influenced consumers to make the switch, include the ability to transfer money more easily (28%), free transactions abroad (22%) and the benefit of receiving real-time notifications about spending (22%).
For consumers who are keen to make their money go further, these digital banks offer convenient methods of financial management.
This last point is key: for consumers who are keen to make their money go further, these digital banks offer convenient methods of financial management. Many challenger banks offer individuals greater oversight over their finances and enable a better understanding their spending habits – and perhaps more importantly, digital banks also highlight ways in which they can improve their financial behaviour. For example, many of these apps come with real-time tracking of spending.
Beyond this, they also commonly include features which encourage saving. For instance, a consumer might utilise functions which round up expenses to the nearest pound, before depositing the remainder in a designated savings pot. For those with more long-term financial goals in mind, other functions might help users set monthly budgets and receive notifications if they are overspending.
The general point to note is that consumers are becoming savvier when it comes to saving, in turn making them less reliant on traditional savings methods that can fail to satisfy their needs. It’s encouraging to see more people seizing the opportunity to make the most of their money, and challenger banks are certainly helping.
