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There is a lot to organise when you are moving, especially when moving across the world!

If you are permanently moving to Australia you will want an Australian bank account, this will help you avoid charges and give you a secure way to spend, save and receive payments whilst in Australia.

There are 4 main banks in Australia

ANZ – Open an everyday account with ANZ to hold money and receive your salary. There will be a $5 monthly fee to have an account with them. ANZ have wide access to ATMs across Australia so you will be able to withdraw without any fees if you use these.

Commonwealth Bank – Known as Australia's largest bank. Offering assistance with your move to Australia to help you settle in quickly. You can open an everyday account and a savings account. There will be a $4 monthly fee to have an account however they offer new customers 12 months free to set you up with ease. You will be able to avoid withdrawal fees as they have a network of ATMs and branches across the country.

Westpac – One of Australia's first banks. You will have a $4 monthly fee to have an account here, after your first 12 months which you can get for free as a new customer. They offer fast and secure banking using mobile apps and more. You will have no fees when sending money overseas, meaning you can send money back to your friends and family with no trouble.

NAB – Known as Australia’s largest business bank helping small, medium, and large businesses take care of their finances. You can enjoy no monthly fees or withdrawal fees when you have a transaction or savings account with NAB. You will have to go into a branch to set up your account when you arrive in Australia.

These banks will often waive the monthly fees if you meet these requirements;

What you will need to set up a bank account

You will be able to start the process of setting up a bank account whilst still in the UK however, you will have to complete the process once you arrive and go into a branch.

To start the process online you will need.

Once you have uploaded the correct information online you will have to verify all the documents again in person so you can withdraw, spend, and move money.

Accounts you can open before you leave

 

 

There is a new mortgage model coming to the UK soon which could make it more affordable to take out a mortgage for more people. This new mortgage model is designed to save the borrower money as well as reduce the risk to the lender. It’s a win-win for everyone!

This involves the interest rate coming down as the loan is being paid off. This means the borrower could save an estimated £5127 in interest if the LTV fell from 85% to 60% as stated on a National World report.

The Guardian offers this example, “if you buy a property for £200,000 and borrow £150,000, your LTV is 75%. If you reduce the mortgage debt to £140,000, your new LTV would be 70%. Assuming that at that point April Mortgages has a cheaper rate available at 70% LTV than at 75% LTV, it will automatically switch you on to the lower rate in which case you do not have to do anything.”

The offer

This model will be a great option for all involved as the borrower is saving money as the interest rate decreases, equally, this reduces the risk for the lender as the value decreases.

April Mortgages

The model originated in the Netherlands by April Mortgages in 2014. Since then, the firm has facilitated over 100,000 loans which has accumulated nearly £25.63 billion. They are now one of the top lenders in the country.

April Mortgages offer flexibility and reward their customers for their repayments as they fulfil their end of the deal.

In a National World report, we learn that “April Mortgages were authorised by the Financial Conduct Authority in October to offer loans for 15% deposits but is now planning to accommodate first-time buyers with 5% deposits by the end of March.”

Tim Hague is the director of the firm and speaks on the new model having been successful in the Netherlands after doubt and now the wish to bring his ideas to the UK is reality.

There are various types of mortgage models currently available in the UK which you can learn about here. 

Are you interested in a Dutch-style Mortgage?

Both banks and credit unions carry their strengths, but what suits you is heavily dependent on personal needs and preferences. So let’s dissect these institutions and empower you to make an informed choice.

Understanding the Basics: Know Your Banks and Credit Unions

It's crucial to grasp what distinguishes banks from credit unions before deliberating over which one best suits you.

In simple terms, a bank is an institution licensed under state or federal laws that gains profits by lending money at higher rates than what they pay to their depositors.

On the other hand, credit unions operate as not-for-profit organizations owned by their members (i.e., account holders) who share common characteristics like workplace or geographical area.

Peeking Under the Hood: How Banks Operate

As mentioned, banks are driven by profits obtained through interest charges on loans and financial products. Here's an inside look:

Understanding these aspects helps evaluate whether you find their operation mode appealing or otherwise.

Credit Unions Offer Similar Products to Banks, e.g. Savings Accounts

Just like banks, credit unions provide a gamut of financial offerings. This includes savings and checking accounts, consumer loans such as personal or auto loans, and mortgages just like traditional banks.

Their not-for-profit status often results in low fees and competitive interest rates compared with banks. For example, you can open up a regular savings account at most credit unions that are insured by the National Credit Union Administration (NCUA) against default risks.

They cater to individualized customer service due to their community focus. Hence they might have strict membership requirements based on common bonds among members (e.g., residing in certain regions or working for specific employers). Having access to similar products coupled with other perks gives us a firm basis for comparison.

Weighing Bank Fees Against Credit Union Dues: Down to Brass Tacks

In terms of cost-effectiveness, both banks and credit unions have their pros and cons. Yet it boils down to what provides more value for you.

Banks may charge higher fees related to overdrafts, minimum balance requirements, or withdrawal penalties which can frequently be subjectively minimized by diligent financial management. In return for a variety of wide-ranging services and conveniences such as extended banking hours, branch networks across the country, and technologically advanced online platforms.

Credit unions typically offer lower fees due simply to their non-profit nature but might come with limited coverage regarding locations or operating hours.

Knowing where your priority lies regarding these aspects will make choosing between the two an easier feat.

Making a Decision: Which Suits You Best?

In weighing both alternatives, there isn't a 'one size fits all' answer. It depends on personal preferences and needs:

The Bottom Line

The last thing to mention is that neither of these options is exclusive. You can utilize both systems for different financial aspects (e.g., auto loans from credit unions while maintaining checking accounts at traditional banks). So consider your needs prudently and choose accordingly.

 

In a digital age where cybersecurity and operational resilience are paramount, the European framework known as DORA (Digital Operational Resilience Act) has emerged as a significant touchstone for financial markets. This act illuminates the pressing need for financial institutions to bolster their digital defences and streamline operations, particularly against the backdrop of increasing cyber threats and ICT disruptions. As we delve into this intricate framework, we sit down with Junaed Kabir, Partner and Managing Director of Parva Consulting, to uncover its profound implications, specifically for Luxembourg, a notable epicentre in the global funds industry. The insights provided shed light on the challenges ahead and highlight the potential opportunities for those ready to adapt and innovate.

 

To begin, please clarify the essence of DORA and its significance to the funds industry?

DORA (Digital Operational Resilience Act) is a European framework that aims to establish a robust and resilient approach to delivering digital capabilities in Financial Markets.

The requirement to ensure that organisations can continue resilient operations in the face of significant disruptions caused by cyber-attacks and information and communication technology (ICT) concerns is at the heart of DORA. DORA fosters the convergence of standards for ICT and cyber practises by offering a unified and consistent approach.

DORA covers five major issues: ICT risk management, incident reporting on ICT-related topics, administration and oversight of critical third-party providers, digital operational resilience testing, and information and intelligence exchange.

DORA underlines the significance of financial firms proactively identifying and categorising ICT assets in order to restrict inherent risks to acceptable levels. Financial institutions must develop effective risk management policies to protect themselves from cyber-attacks and disruptions by thoroughly knowing their digital infrastructure.

 

Luxembourg is a prominent hub in the global funds industry. How do you envision DORA specifically impacting this sector in Luxembourg?

The emphasis placed by DORA on strengthening operational resilience and defending against ICT-related risks will compel Luxembourg's financial institutions to reconsider their current processes and controls.

DORA will necessitate the implementation of new and more sophisticated rules, information technology controls, and resilience testing procedures. While some businesses, such as credit unions and investment firms, may already be in compliance in some areas, many will need to create totally new frameworks to meet DORA's criteria.

As the compliance journey evolves, it becomes increasingly crucial to incorporate critical stakeholders in the process. Information Security Officers, IT Officers, Risk Officers, and others must work together and contribute to achieve total compliance.

 

Can you delve into how the implementation of DORA might affect the daily operations of firms in the funds industry?

As Luxembourg-based financial institutions begin their compliance journey, it is obvious that DORA necessitates a proactive and dynamic approach to operational resilience and risk management.

Given the prominence of Luxembourg in the global funds industry, the country's financial firms will need to embrace DORA's criteria in order to maintain their competitiveness and reputation. As the legislative process draws to a close, the Luxembourg financial sector must prepare to detect, monitor, and defend itself against an increasing variety of ICT-related threats. This includes adapting to the Act's requirements for robust ICT infrastructure, incident reporting systems, and comprehensive testing.

 

Are there particular challenges that Luxembourg-based funds might face concerning DORA that you don't foresee in other jurisdictions?

The adoption of DORA is expected to have a significant impact on the financial industry, requiring various reforms to comply with the new regulatory framework. DORA seeks to increase the operational resilience of financial institutions by pushing investment firms to make significant changes to their internal procedures, risk management systems, reporting, and transparency methods.

Many Luxembourg-based financial institutions benefit from the IT infrastructure of a parent firm that is not based in Luxembourg. Control, oversight, and incident reporting are frequently assigned to the parent corporation. This will have to change; under DORA, the Luxembourg organisation must be able to demonstrate complete ownership of the IT infrastructure.

Investment businesses will need to conduct a thorough examination of their internal procedures in order to identify flaws and potential sources of failure. To avoid disruptions caused by cyberattacks or technological failures, comprehensive operational risk management practises, such as the establishment of contingency plans and seamless communication between departments, will be essential.

DORA intends to impose higher transparency standards on investment firms, forcing them to provide more detailed and regular disclosures to regulatory agencies and investors. This will need the development of new reporting frameworks capable of capturing a greater range of operational risks and occurrences.

DORA implementation will increase compliance costs and resource allocation for investment firms. Adapting procedures and systems to satisfy the new criteria will necessitate a significant investment in both financial and human capital.

Investment firms will need to invest in advanced technology and cybersecurity measures to boost operational resilience. Cyber threats constitute a significant threat to operational continuity; therefore, enhancing cyber defences is vital.

DORA is a critical step towards enhancing the financial industry's technology and cyber risk management and resilience. DORA's goal is to offer a uniform regulatory framework that improves the industry's operational resilience across all EU member states by focusing on risk management, incident reporting, and oversight of critical third-party providers. Financial organisations must proactively embrace DORA's criteria to ensure their ability to withstand, respond to, and recover from ICT-related disruptions and threats, ultimately safeguarding the stability and security of the financial system.

 

What opportunities might the introduction of DORA bring for the funds industry, particularly in Luxembourg?

The implementation of DORA in Luxembourg opens several opportunities for the funds business, leading to increased growth, innovation, and competitiveness in the global financial market.

DORA's implementation has the potential to improve collaboration and knowledge exchange across the funds industry, resulting in a more unified and forward-thinking financial ecosystem.

 

How should fund managers prepare for the implementation of DORA? What steps can they take now to ensure a smooth transition and ensure they are ready for January 2025?

Fund managers need to plan ahead of time for the adoption of DORA to ensure a smooth transition and compliance with the new regulatory framework. Early and planned action will help them mitigate hazards, streamline processes, and improve overall resilience. They can take the following critical steps:

 

How does Parva Consulting support clients in preparing for and navigating regulatory changes like DORA?

Parva Consulting assists customers in preparing for regulatory developments like DORA, achieving compliance and improving operational resilience through professional consulting services.

 

By Muzammil Shabudin, Risk Advisory Lead for SAS UK & Ireland.

News that The Bank of England had initiated an external review of its forecasting models, to ensure that it was doing everything possible to better respond to economic disruption, was welcomed by many back in June.

The review followed months of uncertainty and criticism from politicians accusing the Bank of repeatedly failing to predict the rise and persistence of UK inflation. The Bank of England Governor, Andrew Bailey, admitted that it would take “a lot longer than we expected” for inflation to come down. This has left economists continuing to warn of further interest rate rises and mortgage lenders rushing to reprice loans, meaning the problems facing the UK economy are clearly not going away.

Further pressure was applied when a cross-party group of MPs called for an overhaul of forecasting processes, deeming that the Bank of England’s modelling was not producing accurate results.

This situation brings to the fore the importance of good model management, especially given the economic turbulence witnessed in recent years. If the models relied upon by the financial services sector are no longer able to accurately forecast events - such as interest rate rises – then economic stability becomes much harder to maintain.

For this independent review to be deemed a success, a structured approach must be taken, using a risk and control audit methodology and the use of consistent, robust and scalable analytics techniques. Here are some of the key elements that should be considered.

Ensuring good governance

It’s important to point out that forecasting and risk models are only as good as the governance framework in which they operate. No matter the quality of the data that goes in, if organisations are not continually reviewing their processes around model development, usage and reporting, there is a chance that these models become unfit for purpose.

A clear governance framework will also help to ensure that any models requiring amendments or recalibration are easily and quickly identified. With automated modelling techniques now becoming far more common, organisations such as the Bank of England need to ensure that their forecasting and risk models are fully explainable.

This becomes all the more important when faced with criticism or scrutiny from regulators or MPs.

Of course, the Bank of England has thousands of models in place so questions will need to be asked around how broadly they want to consider their models, how in-depth they want to go and whether or not they want to review or rebuild every model. Similarly, there is a question around how far back into the data management space the review ought to go.

When looking at risk mitigation, the auditors will also be focused on the controls in place to mitigate risk, whether or not they have been effective to date and if they remain fit for purpose. If the risk mitigation process is found to be overly manual or overly automated, this will raise questions about its effectiveness.

All of these questions need to be considered before the review begins, to ensure that the outcome is satisfactory.

Advances in technology and the need for greater regulation

Aside from the external factors that have made forecasting more challenging, namely the global pandemic and war in Ukraine, rapid advances in technology have also raised questions.

The increased adoption of artificial intelligence (AI) and machine learning (ML) means that forecasting and risk models are now able to evolve much faster than they previously would have done. Without the right technology in place, this can soon start to create challenges.

In fact, regulation around model risk management processes is already becoming more stringent, with the Prudential Regulation Authority (PRA) having recently directed UK banks to improve model and data governance processes through the introduction of new model risk regulation.

The Supervisory Statement SS1/23 highlighted the fact that UK banks were lagging behind international peers when it came to ‘effective and robust’ model risk management (MRM). Not only did this leave them open to damaging losses, inaccuracies could have an impact on the overall stability of the UK economy.

With this in mind, the new proposed standards contain five key principles that have been designed to reduce the probability and severity of future crises in the financial sector. Covering model identification and model risk classification, firms must have an established definition of a model that sets the scope for MRM, a model inventory, and a risk-based tiering approach to categorise models to help identify and manage model risk.

There is also a focus on good governance, with firms required to promote good MRM culture from the top down, setting clear model risk appetite, approving the MRM policy and appointing an accountable individual to be responsible for implementing a sound MRM framework.

Alongside this, firms must have a robust model development process with clear standards for model design, implementation, selection and performance measurement.

Given the volatility of the market and challenging economic backdrop, firms will also be required to regularly test their data, model construct, assumptions and outcomes - key processes that will help to identify, monitor, record, and remediate any limitations and weaknesses within the models.

In addition, the PRA has introduced independent model validation to ensure that recommendations for remediation or redevelopment are actioned as quickly as possible so that models are suitable for their intended purpose. Should models be under-performing, firms also need to take quick action, often in the form of an independent review to ensure that they are working effectively.

Taking action

SAS works with organisations across all aspects of the financial services sector, having partnered with over 80 banks to implement robust MRM processes. Given the rapidly changing environmental and digital landscapes, as well as the aforementioned increasing use of AI and sophisticated modelling techniques, now is undoubtedly the time for firms to adopt a more strategic approach not only to MRM but all model management.

As we have seen recently with The Bank of England coming under fire, inadequate or flawed design and implementation of models can lead to adverse consequences that pose significant risks to both their own financial stability and the overall economic stability of the UK economy.

 

By Alexandra Mousavizadeh, CEO and co-founder of Evident

 

The rush to deploy Generative AI tools like ChatGPT has created a backlash and led to calls for a pause on deployment while we work out how to regulate these powerful systems. The challenge is one of imagination - what should the regulation look like and how should it be enforced? If they have the will to lead, the banks might hold the key to a workable solution...

 

The basis for The Future of Life Institute’s call to pause experimentation with large artificial intelligence (AI) systems was to buy some time. Time to do what, exactly?

 

OpenAI’s CEO and founder, Sam Altman, has argued that a vital ingredient for a positive AI future is an effective global regulatory framework. Yet no one can agree what this might look like. The 18,980 signatories to the open letter, (some of whom have since backed out or claimed to have been misrepresented) have not put forward a plan.

 

The current regulatory landscape for AI is a messy patchwork of national- and industry-level initiatives. These range from FTC and FDA efforts to address specific, yet limited industry use cases, to the EU’s AI Act and the US’s Algorithmic Accountability Act - both admirable in their intent to create a more universal framework, but flawed in their appraisal of risk.

 

Crucially, there has been no consensus reached amongst technologists, executives or regulators regarding what it’s like to be an end-user of AI-based products, and hence, what sort of regulatory framework is appropriate to pursue.

 

Like opening a bank account

For many people, AI and its potential harms remain theoretical or fantastical - conjuring up images of Terminator and Skynet rather than practical concerns. And yet, seen within an industry-specific setting such as financial services, it’s easier to understand the AI risks that are already emerging. For example, being defrauded of your life's savings, unfairly denied insurance for medical care, or extorted over loan repayments.

 

I’d argue that being an end user of an AI system is certainly comparable to a customer opening a new bank account, stepping onto a plane or taking a prescription pill - all industries that require strict external oversight due to the acknowledged risks involved.

 

When we open a bank account, we do so with the knowledge that we are protected by a rigorous, dutiful and democratically constructed set of regulation-enforced and accredited safety standards which are subject to external oversight. The regulator sets the standards for the industry, and while it won’t fully prevent bank runs, ID fraud or other depositor woes, it protects the vast majority of customers most of the time - to the benefit of the industry, and society at large.

 

It follows that we ought to create similar standards for any providers seeking to offer AI-based products within these industries and ensure clear oversight to prevent any breaches - intentional or otherwise - from occurring. We should even consider setting the bar higher when it comes to AI standards, due to the potential speed, scale and scope of deployment that ChatGPT has shown to be possible for these systems.

 

Banks can set the agenda

The idea of a global regulatory framework for AI is bandied about much more often than it is scrutinised. And yet, one key lesson from the financial sector is that overlapping national regulatory bodies, with a remit based in law and the powers to investigate and punish organisations that transgress, is the closest humanity has ever come to controlling systems which, like AI, are both powerful and profitable.

 

Look no further than the cryptocurrency sector as it is dragged kicking and screaming into the regulatory capture of traditional banking, shedding the worst of its fraud, misdemeanour and exploitation of users as it goes.

 

Similarly, by approaching AI through the prism of the strict regulatory regime that they’ve been working in for years, the banking industry has already taken significant pre-emptive steps to prevent potential harms from occurring.

 

The world’s leading banks have already developed best practices that are well-suited to an AI-led future. Kitemarked security (to stop users from seeing one another’s data, as was the case with ChatGPT); a mixture of auditing and industrial safety standards; accreditation for practitioners (where now most AI developers have no training at all in ethical application; transparency and accountable coding); interdepartmental oversight so leaders get early warning when something is going wrong. And of course, there’s intense scrutiny by regulators and regular submissions of financial and other performance data.

 

All of these tools will be extended to AI deployment in banking use cases. The challenge - and opportunity - for banks is to embrace this publicly. Banks have no greater asset than trust. Getting ahead of this topic will enable them to build public confidence in their approach and set an example across the wider economy - potentially encouraging some of their corporate and SMB clients to embrace a similar mindset.

 

Seizing the initiative

Time is running out for industry leaders, policymakers and regulators to fill the governance vacuum and ensure that the pursuit of powerful AI proceeds with greater caution and consideration.

 

Getting artificial intelligence regulation right is a matter of imagination, resources and speed. The imaginative step from current banking best practice to include AI is a feasible one. Banks do not lack in resources. It’s time for banking leaders to seize the initiative, reaffirm their own commitments to (and internal standards) around responsible AI self-governance, and drive the public discourse around workable, industry-specific AI regulation.

When we hear the likes of ex-Prime Minister Liz Truss accused of reverting to an economic theory known as trickle-down economics, what do ‘they’ mean?

What is trickle-down economics?

In its simplest form, trickle-down economics is the theory that by increasing the wealth of the rich, they will spend more money, which would trickle down throughout society, leading to more wealth for all.

How does trickle-down theory work?

The theory itself is relatively simple, with the concept being that if we cut income and corporation taxes in our society and de-regulate our financial institutions, the increased wealth of these individuals and corporations would result in the rich being able to spend more of this additional money. The rich would then, in theory, invest and spend this new excess in wealth, which would, in turn, result in an increased demand for goods and services, increasing employers’ ability to recruit more staff and offer higher wages.

In this theory, the argument presented is that cutting taxes increases the incentive to work. If workers have a lower income tax, they would then be incentivised to work longer. In addition, reducing taxes such as corporation tax should encourage businesses to invest, which would, in theory, increase wealth.

Another outcome would be that the wealthy would invest in businesses, creating new jobs and more income for those employed. If the wealth is invested in new companies, it will create new jobs and increase the incomes of those employed.

As a result of the above-referenced spending and investment, it is theorised that this would stimulate economic activity, which in turn would increase tax revenues through more income tax due to the increased jobs or higher VAT due to increased spending.

These higher tax revenues could then fund public programmes such as healthcare, education, and welfare payments to the poorer in society instead of, the higher taxation that limits the richest in our society from investing.

Does trickle-down economics work?

This is mostly subjective and down to which side of the economic spectrum you lean on. It has both its pros and its cons, and essentially, as with most things in life, it would depend on how you would be personally affected.

There are examples of trickle-down economics in practice. Famously, President Ronald Reagan and his “Reagonomics” became a beacon to those who believed in trickle-down economics when he passed two tax reform bills in the 1980s which brought tax down for higher earners from 73 percent to 28 percent, as well as reducing corporation tax from 46 percent to 40 percent. It is argued that as a result of this, the USA came out of recession in the 1980s and is lauded as an example of trickle-down economics working.

However, this paints only a small picture of that time, as in addition to reducing taxes, government spending increased by 2.5 percent a year, and federal debt in the USA tripled. Therefore, it is argued by its detractors that trickle-down economics in its purest form wasn’t ever implemented fully, and it could have been the increased government spending that, in fact, ended the recession.

There are further examples of this theory being put into practice, such as President Herbert Hoover’s Great Depression stimulus after the crash in 1929, Prime Minister Margaret Thatcher’s policies in the 1980s, and President George Bush’s Tax Cuts in 2001. So the theory has been tested, though some would argue not to its full extent and in its purest form.

In reality, however, one thing that becomes very apparent when this process is applied is that economic inequality increases. Suppose we use President Reagan’s and President Bush’s cuts as examples. According to trickle-down economics, Reagan’s and Bush’s tax cuts should have helped those at all income levels. But the opposite result took place: income inequality worsened. Between the years 1979 and 2005, the bottom fifth saw a 6% rise in after-tax household income. While this on its own seems great, it’s important to note that the top fifth experienced an 80% increase in after-tax household income. The income of the top 1% tripled, showing that prosperity was trickling up rather than down.

Why does economic inequality happen as a result of trickle-down economics?

In most cases of its implementation, the rich get much richer because they don’t want to invest their excess wealth. As a result, money is often stored in off-shore accounts to further preserve their new wealth. Furthermore, tax cuts for the richest in society don’t often translate to increased consumer spending, rates of employment, and government revenues in the long term. Inequality rises, and examples of the opposite system seem to work better with tax cuts for middle- and lower-income earners driving the economy through the trickle-up phenomenon.

In Conclusion

The trickle-down economics system does have its merits; however, in most practical examples, the successes are somewhat clouded due to the use of other measures to prop up trickle-down economics as a system. Therefore, it seems that as yet, we haven’t seen the theory work on its own, and with the recent failure of the Liz Truss & Kwasi Kwarteng mini-budget in the UK in October of 2022, it seems that this may continue until a severe shift in economics and public opinion can happen.

Jacob Mallinder – Finance Monthly

With digitalisation rapidly progressing and affecting every aspect of our lives – from the way we play to the way we pay – eCash levels the playing field for cash payers.

Much of society is becoming increasingly cashless, with the volume of cashless payments globally expected to rise by 80% between now and 2025. But it’s vital to remember that underbanked and unbanked communities don’t have the luxury of bidding farewell to physical currency. Many people around the world simply don’t have access to a bank account or a debit or credit card.

By digitalising cash, we can offer marginalised, cash-reliant communities access to online payments and enable them to participate in the world of eCommerce and digital financial transactions. It also allows security seekers to pay in cash and avoid having to provide personal financial data online.

In fact, according to our latest Lost in Transaction research study, which examines changing payment habits and preferences, 52% of consumers globally reported that they don’t feel comfortable sharing their financial details online. And 68% said they prefer using payment methods that don’t require them to share their financial details when paying.

 

Digitalising cash for online transactions

 

eCash, which enables cash to be used for online transactions, provides access to the digital world to cash payers and security seekers. Popular examples include the prepaid solution paysafecard as well as the post-paid barcode solution Paysafecash.

 

Paysafecard comes as a voucher with a 16-digit code that can be purchased in various denominations at petrol stations, supermarkets and convenience stores. The balance can then be redeemed by entering the code at the online checkout. This solution is particularly popular in the world of online entertainment and includes a spending control aspect that appeals to consumers as they can only spend the amount they have previously purchased with cash.

Paysafecash payments are made by generating a barcode during the online checkout, which can then be scanned and paid for in person at a nearby payment point. This solution has become increasingly popular for online transactions such as rent and bill payments, loan repayments, cash deposits into wallet-based financial services as well as a cash-in/cash-out solution for banking.

 

Paying for essential services in cash

 

When it comes to rent, utilities, loans and countless other essential services, cash is still the most available and most immediate payment method for unbanked and underbanked communities.

 

While many are revelling in how online payment platforms have simplified the process, this same proposition presents a huge hurdle for typically low-income groups who must find a way to pay for these services using cash funds without the luxury of a simple bank transfer or credit card.

 

eCash can facilitate this process, boosting financial inclusion and reducing missed payments. It allows cash-reliant communities to enjoy all the benefits of paying for services online without having to become banked. They can simply select “cash” as a payment option on the checkout page, generate a barcode and settle the amount in cash at a nearby payment point.

 

Bridging the gap between cash and banking

 

There are a number or reasons why people remain unbanked or underbanked and the high cost of traditional banking has certainly played a major role. While digital banks pose an attractive solution in terms of being less cost-intensive, they are still out of reach for anyone who relies heavily on cash.

 

Implementing eCash helps bridge that gap. It makes digital banking more accessible for cash-reliant consumers, providing them with an easy solution to cash-fund their accounts. Similar to choosing cash as a payment method during checkout, in this case, a barcode for a cash deposit can be generated in the digital bank’s mobile app. The barcode is then scanned at a payment point, the consumer pays the balance in cash and the amount gets credited to their digital bank account.

 

This also works for other financial service providers that utilise eCash for cash-funding their accounts, providing users access to any number of app-based budgeting and money management tools, setting up savings pots, or transferring money easily to friends right from their phone.

 

Beyond digital banking, eCash can also enable greater access to cash services in partnership with traditional banks. With bank branches closing and the availability of cashpoints decreasing, eCash payment points at participating retail locations can also be used to withdraw money. To do so, users would follow the steps above, generating a barcode in the banking app for the desired amount.

 

Paying with cash online

 

Taking it a step further, eCash doesn’t need to be limited to merchants and service providers who have integrated it as a payment solution. In combination with digital wallets like Skrill and NETELLER, eCash can open the door to online shopping in general.

 

Users can simply choose paysafecard or Paysafecash to deposit money into either of these digital wallets. This, in turn, allows consumers to use their cash funds with merchants that have integrated Skrill or NETELLER. They can also use prepaid credit cards available through these digital wallets to make payments literally anywhere.

 

Making progress inclusive

 

While there is no stopping digitalisation, it doesn’t have to go hand in hand with financial exclusion or remove cash from the payment mix. eCash is a powerful tool to mitigate the challenges of an increasingly cashless world, providing those who continue to rely on cash the ability to pay online for anything from online shopping to essential services.

 

The wearable technology market is rapidly expanding - when walking down the street; it feels like everyone has a smart watch or ring tracking their health, sleep, exercise, and even “energy levels.” But one specific type of wearable is gaining traction: payments. Payment-enabled wristbands, rings, and watches are seeing growing popularity as convenient alternatives to traditional payment methods. However, the technology available for wearables today requires each manufacturer to integrate directly with each and every bank/issuer in the market. Sometimes we’re talking about 1000’s of banks in each market. That creates an impossible mission for innovative wearables manufacturers to offer a credible ‘pay’ capability. At Curve, we recognized the potential of these passive wearables and saw an opportunity to leverage our wallet functionality to revolutionise the payment experience and help manufacturers get to 100% bank coverage. Curve’s wallet functionality also allows customers to attach multiple existing credit and debit cards to the Curve app, and charge those cards through the single Curve card. This “multiple cards in one” functionality makes Curve uniquely positioned to take on the passive wearables market – whereas previously, people could only connect one single card to their smart ring or watch, now they can connect all their cards.

It could have been a risky move, entering an entirely new market – wearables – when we were previously so focused on our original project. Expanding our horizons and jumping headfirst into a new opportunity it’s paid off tremendously. Over the last two years, Curve has focused on forging strong partnerships with leading wearable companies, including Swatch, Garmin, Samsung, Wearonize, Fidesmo, Tappy, Xiaomi, and Digiseq. These collaborations have allowed us to seamlessly integrate our game-changing technology that enables multiple cards to be connected to a single wearable device, a feat that was previously impossible with passive wearables. By doing so, we’re creating a unified payment experience that supports a wide range of payment wristbands, rings, and watches.

Our strategic partnerships have significantly expanded the wearable payments ecosystem. These collaborations have enabled partners to offer an array of customizable wearable options, catering to a diverse range of preferences and styles. While smart devices are bound by the need for software, charging, and screens for interaction, passive wearables can take on almost any form. This flexibility allows manufacturers to really let their creativity flow. Innovators in the space have pushed creative boundaries to enable everything from shirts to jewellery to accept payments. The success of these partnerships is evident in the numbers - wearable customers who attach Curve are more engaged and exhibit higher retention.

 

Curve is actively exploring ways to support our passive wearable partners in targeting large, traditional fashion brands. Many fashion brands have signature aesthetics that customers use to identify a brand. Through Curve’s successful partnership with Swatch, we’ve proven demand for payments-enabled traditional watches. By combining our payment technology with the design expertise of fashion brands, we aim to create a new breed of fashionable and functional wearables. This strategy will not only broaden the appeal of wearable payment devices but also help our partners tap into new market segments.

 

In addition to our efforts in the passive wearables space, Curve is exploring opportunities with a number of smartwatch brands. By collaborating with these companies, we can bring the benefits of Curve’s wallet functionality to a wider range of devices, enhancing the payment experience for smartwatch users as well, without much investment required from the smartwatch brand.

 

Breaking into the passive wearable industry was a marked departure from our traditional channels and serves as a prime example of how it’s worth taking a chance to explore non-traditional customers. As we continue to push the boundaries of innovation, our vision for the future of payments extends beyond just wearables. We no doubt will enter new, currently unconsidered categories. We are committed to raising the bar of customer experience while guiding customers on their journey to financial freedom. Forging strong partnerships with leading wearable companies is a significant contributor to making this vision a reality. By exploring different market segments, embracing new form factors, and targeting untapped opportunities, Curve can confidently shape the future of finance for the better and serve as a model for others to follow.

 

 

 

 

 

 

 

In 2019, the UK Government set a goal of Net Zero by 2050 with an additional pledge to reduce emissions by 68% compared to 1990 levels, by 2030.

However, The British Standards Institution’s Net Zero Barometer report, surveying 1,000 senior decision-makers and sustainability professionals in the UK, found that financial services are falling behind: while 61% of the IT sector have set sustainability goals, financial services sits at 42%. Banks need to understand and address this lag and fast - needing access to the right data to understand the problem and address it in multiple ways.

Pressure on Financial Services

Unsurprisingly, the financial sector has come under a lot of scrutiny from regulators and the public alike, for a perceived lack of action and its role in supporting unsustainable practices. The issues have been kept in the spotlight not just by vigilante groups like Just Stop Oil, but also by recent examples like an active shareholder revolt at HSBC, pushing them to divest from energy companies.

But it is not just activists and regulatory groups. There is significant proof in the data that consumers are seeking alternatives to the traditional banking orthodoxy. Customers of retail banks have shown strong demand for green finance products, with 45% seeking sustainable credit & debit cards, and 31% seeking green loans and mortgages.

The focus on environmental, sustainability and governance (ESG) within investing has also ramped up year after year. We’re starting to see a new phase that we call ‘banking on purpose’, connecting boards and consumers in visions for a greener future, whilst increasing prosperity for the communities they support.

ESG considerations are set to loom large over companies — this will be important to maintaining reputations at a consumer, shareholder and board level.

Integrate Green into the Offering

Promisingly, data reveals that 83% of new build houses in the UK are eligible for a green mortgage. However, £2.9 trillion of UK housing stock is currently ineligible, providing a significant opportunity for banks to serve these homeowners. Offering loans to support renovations that seek to improve the energy efficiency rating of properties can help FS institutions embed consumer-focused initiatives into their offerings, rather than having them as an afterthought.

Retail banks have started to promote sustainability and are affecting change — for example, Lloyds Banking Group’s ‘Helping Britain Prosper’ strategy directly tackles the challenges of ESG for all stakeholders, securing more sustainable returns and capital generation by honing in on housing access, inclusion, and regional development, while aiming to reduce its own carbon emissions by over 50% by 2030. Its efforts are aligning with a sustainable financing portfolio, pledging over £52 billion in investment by 2024 as part of their ESG strategy.

Change is equally underway at the consumer level with NatWest introducing its own carbon tracker feature that analyses consumer transactions and applies it to a regulated emissions calculator, calculating the carbon footprint throughout the complete process. By introducing this feature as well as suggesting ways customers can reduce their own personal impact, they hope to save 1 billion kilograms of CO2e emissions per year, the equivalent of planting 1 million trees.

To ensure banks can become sustainable whilst remaining competitive, accurate measurement of emissions is critical and must include scopes 1, 2 and 3 emissions. This is not a simple task and requires a digitally enabled, agile and modern core at the centre of the business.  If Financial Services firms want to drive meaningful impact, they will need to move from treating sustainability from the periphery to the core of their business priorities.

By putting environmentally friendly initiatives at the heart of their business strategies, the banking industry can fulfil the needs of their customers and ensure we all play our part in building a more sustainable future. This is certainly a positive start to the UK’s mission of reducing its greenhouse gas emissions by 2050, we still expect to see this industry ramp up its efforts as we get closer and closer to the point of no return.

Jayakumar Venkataraman, Managing Partner, Europe, Financial Services and Insurance at Infosys Consulting: 

“For almost a decade, banks have been operating at low rates because of the Bank of England keeping rates significantly low, impacting their ability to drive substantial revenue growth.

“The difficulty today is that we have a whole generation that has become accustomed to low interest rates and high borrowing. With the sudden switch back to high rates, borrowers will need to get used to servicing their level of borrowing at these high rates or reduce their borrowings to a manageable level. 

“During this period of adjustment, it is likely that customers may experience varying levels of financial discomfort and distress, meaning banks need to step up to the plate when it comes to leveraging the data and predictive capabilities of AI and ML to identify early signs of trouble. Banks must become proactive in reaching out to customers and supporting them through appropriate advisory and restructuring of their financial liabilities. Thereby providing empathetic customer experience, especially during these times of financial confusion.

“With the financial squeeze tightening for many consumers, banks need to ramp up investment when it comes to educating customers on how to manage their finances too. This includes informing customers on various borrowing options or alternatives that fit their personal situation. We can expect to see banks evolve from mere transactional hubs to centres of consultancy - advising on what options are available to restructure debt, and offering solutions better suited to individual cashflows and business needs.”

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