The challenges of adjusting to the reopened economy have placed financial services under significant strain. Budget cuts, the great resignation and post-Brexit recruitment problems mean that many employees are spending disproportionate amounts of time grappling with mundane operational tasks to simply keep businesses afloat. Innovation and strategic planning run the risk of being left behind as energy is spent on resource-sapping back-office complications.

This stagnation can be costly - in more ways than one. A study has found that office workers in the accountancy, banking and finance sectors spend on average over three hours a day on manual, repetitive tasks which are not part of their primary job. As well as being slow and demoralising, such high levels of manual processing can lead to inconsistent results and financially damaging errors.

Tactical solutions are needed to ease the burden on teams and free up staff to focus on more challenging, qualitative endeavours. This is where automation comes in. By transforming monotonous work into streamlined automated processes, businesses can reduce costs, drive productivity and efficiency, and foster a happier workforce culture.

The need to automate

Rapidly accelerating digital transformation has created a wealth of opportunities for financial services. However, invoices still need to be processed and payrolls need to be generated. Currently, these day-to-day tasks form a significant chunk of employees’ time, adding to the pressure they are already under to juggle a variety of repetitive administrative processes. The use of innovative IT solutions to automate these tasks can offer precious time back to teams, allowing them to focus on the more stimulating, value-adding activities that drive business growth.

When it comes to time savings brought about by automation, the figures back up the promise PwC’s Finance Benchmarking Report found that automating finance tasks can save 30%-40% of the time spent on doing the same tasks manually. Not only does this point towards vast efficiency improvements, but it also suggests a reduction in costly instances of human error.

The benefits of automating mundane but necessary tasks can be transformative and empowering -both for employees and for the business itself. Crucially, it allows individuals to channel their energy into more creative and strategic tasks, where they can exercise their autonomy and problem-solving skills to achieve tangible results for the business. Reducing the time taken up by onerous administrative tasks will give employees more time to concentrate on the ‘bigger picture’ initiatives that are so vital to boosting revenue.

Finance departments across the country have been forced to downsize following the Covid-19 pandemic. As a result, many have accrued a formidable backlog of invoicing and payroll tasks – and are relying on much smaller teams to handle them. For these organisations, the use of streamlined automated technology to reduce the administrative burden can help them overcome a significant hurdle on the road to recovery. It is a strategy that will also safeguard them against human error and other internal administrative crises that can cause damaging financial loss. The high level of accuracy and efficiency that automation brings will prove a key factor in the future success of businesses across all sectors.

Long-term benefits

As financial companies vie to attract talent and remain competitive in a post-Covid world, it has never been a better time to embrace smart, expertise-driven IT solutions. A recovery informed by automation will allow businesses to get the most value from their workforce and avoid piling the pressure on overburdened employees to pick up mundane tasks.

It can also be an opportunity for businesses to transform their workplace culture. Employee satisfaction visibly manifests itself in greater productivity, innovation, commitment, and other tangible benefits to the business bottom line. As organisations look to differentiate themselves and retain employees, being able to reassign individuals to more creative, strategic, and value-adding tasks goes a long way to increasing staff morale and retention.

Clearly, tech has a major role to play in the survival of businesses beyond the pandemic. Automation is a versatile solution that can revolutionise the way financial organisations operate without the need for cumbersome, time-draining manual checks.

Richard Shearer, CEO of Tintra, discusses digital banking’s increased prevalence in the emerging world. 

In the West, Digital banking is now entirely uncontroversial to make payments, transfer money, and communicate with banks entirely through mobile apps and websites. The rise of online-only challenger banks is a testament to the staying power of this trend, as newcomers to the banking scene recognise that physical branches are becoming increasingly unnecessary – an eccentric reminder of an analogue world. And, of course, it goes without saying that the conveniences of digital banking have been thrown into an ever-more flattering light during the course of a pandemic which has demanded a minimum of physical interaction in settings like banks, alongside a reluctance to handle cash.

Though these developments in Western countries are, as I have mentioned, well-established, it may be surprising to learn that emerging economies have also witnessed an enthusiastic embrace of digital banking. This is a broad statement, of course, and one that does need qualifying. Pre-pandemic research from McKinsey suggested that for some emerging Asian countries, digital banking penetration had grown by 300 per cent, but the median was a far more modest 52 per cent.

Even with such caveats in mind, there are clearly developing countries whose digital banking adoption has caught up with that of developed markets – in fact, a 2021 survey from McKinsey found that emerging Asia-Pacific markets saw fintech app and e-wallet penetration reach 54 per cent in 2021, whereas developed Asia-Pacific regions only saw penetration of 43 per cent.

Statistics aside, this relationship between emerging markets and digital banking may – at first glance – appear counter-intuitive. After all, the public imagination tends not to associate such locations with technological advances – and this is reflected in one United Nations report, which notes that tech advances and their associated benefits “remain geographically concentrated, primarily in developed countries.”

On closer inspection, however, there are some clear reasons for digital banking’s increased prevalence in the emerging world.

Modern practices for young populations

On a practical level, emerging markets simply contain young populations. In fact, according to PwC, almost 90 per cent of people under 30 reside in emerging markets. This means, in PwC’s words, that “population trends favour the growth of online transactions.”

Clearly, then, the demographic dominance of digital natives has a part to play in the adoption of digital banking across emerging markets – but this is only one in a string of motivating factors. After all, it’s worth noting that a large proportion of emerging markets are getting wealthier: we’re seeing the emergence of a far bigger middle class in places like India, for example. In fact, according to 2019 estimates from World Data Lab, around 600 million Indians were on the cusp of joining the middle classes at that time.

Similar projections have been made by McKinsey in the context of China, with the firm noting that the Chinese middle class will soon reach something in the region of 550 million. All of this additional wealth comes hand-in-hand with greater demand for convenient banking services, whether that be in the form of savings accounts or the desire to link mobile apps to bank accounts – thus setting the stage for digital banking.

However, these are not the only factors that encourage a shift towards digital banking in emerging economies. It would be facile to suggest that this movement is entirely natural or inevitable when, in fact, many emerging market governments actively encourage any moves which boost financial inclusion – ensuring that individuals and businesses can access financial products and services like bank accounts.

As PwC have recently noted, in fact, “governments’ desire to boost financial inclusion and reduce the use of cash is fuelling rapid growth in electronic payment” – meaning that newer technologies and innovations “make it more economically viable for banks to reach the ‘unbanked’ or ‘underbanked’ populations.” 

Far-reaching benefits

This discussion of the active pursuit of financial inclusion brings us on to another set of reasons for the rise of digital banking: its many economic benefits. It is, perhaps, unsurprising to learn that various emerging market governments have a strong economic motive to encourage financial inclusion through digital banking.

Turning briefly to a final set of statistics, it is worth noting that, according to research from HSBC, digital finance is capable of increasing the GDP of all emerging economies by 6 per cent by 2025. In practical terms, this kind of growth could take the form of 95 million new jobs, while markets could see a flow of as much as $2 trillion in new credit. No wonder, then, that digital banking is so highly prized by emerging economies. But, again, there is more to this phenomenon than the slightly dry terrain of GDP growth.

Digital banking doesn’t just create new credit: it spurs on new levels of innovation.

As emerging markets feel the effects of financial inclusion, we’re seeing what some have described as a ‘leapfrog’ process. Some consumers rocket from no bank account whatsoever to the cutting edge of banking services – and, perhaps crucially, this forward momentum has led to further innovations in online banking and similar payments processes.

PwC’s recent report on payments transformations points, for example, to payments made through social media, advances in NFC technology, use of blockchain, and mobile money. As such, emerging markets’ embrace of digital banking isn’t just a fast track towards parity with the banking systems of the developed world – it can be a catalyst for the adoption of revolutionary banking and payments technology.

Rethinking our terminology

Reflecting on developments like this is a great way to remind ourselves that, in fact, the term ‘emerging’ isn’t necessarily the most applicable or appropriate way of describing these markets. After all, these new waves of financial inclusion and technological advance clearly show that many of the countries branded as ‘emerging’ have, in fact, emerged, and now find themselves in a position to capitalise on – and potentially pioneer – the future of digital banking services.

In August, IPC, a technology and service leader powering the global financial markets, announced its partnership with Overbond, a fixed income fintech platform for AI predictive analytics and visualisations. The aim of the partnership is to leverage the voice that IPC captures through its Natural Language Processing (NLP) solution, known as a Dictation as a Service, to facilitate Overbond’s AI pricing and liquidity algorithms. It is worth noting that bond trading tends to be far more illiquid compared to equities, meaning prices for the majority of bonds are difficult to determine due to the infrequency with which they are traded at.

What exactly is being leveraged?

Moreover, to gain a greater understanding of the strategic collaboration, it is important to examine what exactly is being leveraged. Firstly, IPC’s Dictation as a Service is a cloud-based tool. To power this, IPC utilises its award-winning Connexus Cloud infrastructure. The solution allows traders to “dictate” trade terminology as well as translate what is being said in real-time through IPC’s Blotter visualisation platform. The combination of these applications provides end-users with an extensive solution for transforming previously unstructured voice trade data into discoverable, transportable data – all of which takes place in real-time.

Adding to this, Overbond has made significant progress in tackling data aggregation problems impacting automated trading of fixed income securities. Overbond’s COBI-Pricing LIVE tool is a customisable AI pricing engine that helps traders when it comes to automating pricing and trading workflows for global investment-grade bonds, as well as producing prices and liquidity totals for over 100,000 fixed income devices. By integrating COBI-Pricing LIVE with a bilateral representational state transfer (REST) application programming interface (API), which works by handling requests for a resource and returning all the necessary information regarding the resource, translating it into an easily interpretable format for clients, the AI algorithm is able to absorb, collect and process data. This can be from both present and past vendor feeds, internal historical documentation, over-the-counter settlement layer volume records, and now, thanks to this partnership, voice transactions.

Significant milestone

This partnership represents a significant milestone in the evolution of market structure, with technological innovation happening across different levels as a combination of services capable of translating trader voice communications to a structured data feed successfully for bond trading. The aforementioned levels are: voice call tagging to security code – within the workflow of the traders – and AI for downstream processing of the data.

What issues will the partnership help to solve?

Bonds are still traded by voice, with almost 25 percent of fixed-income trades that are made in both Europe and the United States of America executed using voice. This represented a large amount of data that wasn’t previously considered, illustrating a substantial gap in AI-powered, automated fixed-income modelling and trading. The strategic collaboration between IPC, which operates one of the largest networks for fixed-income voice trading in the world, and Overbond will ensure that this valuable voice data no longer goes uncaptured. What’s more exciting, as this trade data can now be captured and anonymised, is Overbond’s algorithms are now capable of pricing fixed-income instruments with greater accuracy. 

It is no secret that the bond markets have been one of the last holdouts in financial services’ digital transformation, however, the resistance has started to wane. Partnerships between organisations, like the one between IPC and Overbond, showcase the ability to bring innovative technologies together developing next-generation solutions for the fixed-income marketplace. The strategic collaboration with Overbond continues the digital transformation of fixed-income trading by fully harnessing the power of voice data. Both businesses support an open platform approach in terms of rethinking how financial institutions around the world trade, optimise productivity and engage in knowledge sharing.

In closing, the partnership between IPC and Overbond enables the integration of IPC’s point-of-trade voice transaction data with Overbond’s AI pricing and liquidity algorithms to bring precision to the automation of bond trades.

Michael Worledge, Head of Financial Services Research at Harris Interactive explains what brands should know about digital transformation in financial services.

Faced with layoffs, job uncertainty, and an economy in flux, consumers worldwide have become far more conscious. They report thinking more about saving and budgeting than they have in the past, and many have prioritized sound investments with well-known providers. At the same time, their once-low confidence around spending is seeing a slow and steady increase.

Recent data shows that consumers are at a point where they’re ready to spend—and save—more. But what about how they’re doing it, and the role that digital financial management plays?  

Let’s look at where consumers are with this digital transformation right now, according to real-time data from our UK Financial Services Sentiment Indicator tracker and our wider Global Barometer. This is especially important for brands because the more understanding and data you can put behind the answer, the better informed your decisions become—and the lower the risk attached to it.

Financial management is forever changed with a rise in “digital first.”

The financial landscape is changing in terms of consumer engagement with internet banking, online payments, digital wallets, and other elements surrounding the transition from traditional to digital financial management.

Digital options play a much more prominent role in normal life than they ever have before. Between the pandemic limiting the ability to visit branches in-person and the resulting pressure on call centres, many have decided that the most remote option is safest. 

As a result:

• Two in five people worldwide say they manage their finances online more than they did 12 months ago.
• A growing number of consumers say they’ll never revert back to how they previously managed finances, ranging from 61% in China to 26% in Japan.
• The UK Financial Services Sentiment Indicator shows that 60% of consumers are comfortable with managing finances exclusively online.

Nearly half of consumers have been influenced by the digital transformation so much in the past year that their behaviour has changed significantly—and, most likely, permanently.

Different age groups show different comfort levels with managing finances digitally

The pandemic forced the adoption of digital alternatives to in-person banking across the board. But just because digital financial management has become far more common doesn’t mean that it has been as easily adopted for every demographic. 

While more than half of consumers ages 55+ say they’re comfortable using self-serve, online-only channels to manage their finances, they show more hesitation over other aspects of online money management, including:

• Frequently using their mobile devices to make payments, at 19%, compared to 48% of consumers ages 35-54 and 56% ages 18-34.
• Twenty-eight percent claim a comfort level using social media and apps to communicate with financial providers, which is well below average compared to consumers 35-54 (44%) and ages 18-34 (54%).

Still, 40% of respondents from each of the three age groups studied here all agree on the importance of having physical bank branches—an area where the 55+ demographic is right on par with those ages 18-54.

Digital wallets are becoming more popular

It’s important to remember that consumers can use digital in their daily lives without having to log into providers’ apps and websites. This is evident at checkout, where more consumers are reaching to pay with their phones instead of their wallets. That’s because digital brands are connecting with customers through the digital wallet, as with Google Pay, Apple Pay, and more. 

In fact, the data shows that digital wallets are becoming a way of life:

• In November 2020, 31% of consumers reported having no need for physical credit or debit cards because they can just use their phone — up from 20% just ten months earlier.
• In November 2020, 37% reported that they’d find it difficult to pay for anything without their phone.
• Today, nearly 50% of consumers report using their phone as a payment tool.

The digital wallet has become a key part of life as smart technology becomes the new normal in activities, financial management, and even in communication via apps like WhatsApp.

Regardless of digital options, consumers support brands that align with their values

Values are of core importance to today’s buyers; they want to know what the companies they’re supporting stand for. This is so crucial, in fact, that:

• 38% of consumers report that they’ve stopped supporting brands that don’t align with their values.
• 57% of consumers report being more likely to support brands that reflect their own values.

Regardless of providing digital options that offer convenience, security, and peace of mind, it’s more important than ever for brands to stand for something and to clearly and continually communicate this to customers. Only a quarter of consumers say they’ll keep supporting brands whose priorities don’t align with their own.

As the data shows, digital is here to stay—and its importance continues to gather momentum across countries and profiles. Brands must stay on top of these ever-evolving trends to make lasting, meaningful connections with their target audience.

To learn more about how you can aid your New Product Development, download our latest eBook guide here. 

Wayve claims a “world first” in driving a vehicle autonomously with only its AI and a SatNav, possessing the ability to adapt to new, unstructured, and highly complex urban environments. Wayve vehicles can apparently operate without the need for pre-programming, human-designed rules, or high definition mapping. 

To date, the startup has raised over $58 million, backed by Balderton Capital, Eclipse Ventures, and prominent leaders in tech such as Rosemary Leith, Yann LeCun, and Sir Richard Branson. 

Wayve is headquartered in London, with its fleet of vehicles testing in cities across the UK. Its collaboration with Ocado includes an autonomous delivery trial that will see Wayve’s technology fitted onto a selection of Ocado’s delivery vehicles. The trial will take place on urban delivery month and will last for 12 months. 

The collaboration marks Ocado’s second self-driving partnership this year. In April, the groceries company took a £10 million stake in another UK-based company, Oxbotica, to build self-driving vehicles for itself and others who use its platform. 

If Web 2.0 took the world by storm by transitioning from the original “read/write” internet model to an interactive medium, where information transfer became a two-way street and social media platforms emerged, Web 3.0 will blur the conventional lines between the digital and physical realms, through the advancement of artificial intelligence, distributed ledger technology, virtual reality and decentralised data networks. But perhaps even more strikingly, the web’s latest evolution may very well prove to be a leap forward towards a truly open and democratised digital landscape.

A closer look at Web 3.0

As we cross the threshold into the Web 3.0 era, users should prepare to enter a web dimension where the people, places and physical aspects of life as we know it break into the virtual world. Through the integration of virtual and augmented reality technologies, Web 3.0 will incorporate a third dimension to users’ browsing experience, enabling immersive interactions. More importantly, its evolution has the potential to redefine the way we experience the world. What was already a vital tool of human interaction, undeniably embedded in our everyday environment is on the verge of becoming even more indispensable.

To put it simply, websites have been gaining more and more features over the years. The once static webs that defined Web 1.0 led the way to the so-called “Social Web”, which enabled richer methods of user interaction. The term Web 3.0, coined by The New York Times reporter John Markoff in 2006, refers to the third generation of the web, which is deeply reliant on the use of machine learning and artificial intelligence (AI).

Often defined as an ‘intelligent’ internet, it aims to facilitate faster, ubiquitous connectivity. Astutely built upon extraordinary technological innovations, the next stage of the web evolution will operate on a machine-based understanding of data, capable of processing information with near-human-like intelligence. The projected outcome is a breakthrough towards a decentralised web space where content creation and decision power is shared by human and artificial intelligence alike.

Paving the way towards a decentralised gateway

“It's hard to overstate the impact of the global system he created. It's almost Gutenbergian.” — Time Magazine

In 1991, British software scientist Tim Berners-Lee radically changed the course of technology with his development of the World Wide Web. At the time he was working at the European Organisation for Nuclear Research in Geneva and realising the challenges of navigating and sharing research between thousands of scientists across incompatible computers. His creation was developed to enable the automated exchange of information on a global scale between scientists and organisations. Indeed, the first-ever web page described the project’s mission as a way “to give universal access to a large universe of documents.” 

Web 3.0 in many ways signifies a return to the original web Berners-Lee conceived, where there is no central authority presiding over what is shared, by whom and when; his vision defiantly emboldened by the principles of data sovereignty, universality and decentralisation.

With blockchain technology at its core, it is the driving force powering the possibility of a decentralised infrastructure that could in time displace Web 2.0’s existing centralisation at the hands of tech giants, rendering the role of major search engines and platforms as ‘gatekeepers’ irrelevant in the future ecosystem.

Understanding the impact of a Web 3.0 environment

As internet consumers, individuals have become accustomed to the give-and-take rules of navigation, such as the invasive surveillance, collection and commercialisation of personal data at the hands of tech giants as well as the increasingly exploitative advertising users face.

The exponential growth of the Internet interconnections has also led to increased security vulnerabilities for individuals and businesses. But what if users were given a choice of operating in a decentralised web environment and forever eradicating the looming threat of cyber risk?

Enter Web 3.0.

We’ve talked about how the rise of distributed ledger technology has fuelled the next dimension of the Internet, but more importantly, the collaborative, transparent and open-source attributes that define blockchain have allowed for a paradigm shift towards an online environment characterised by self-sovereignty, autonomy and decentralisation. 

The disruptive potential of Filecoin is a key example of the ecosystem heralded by Web 3.0. Filecoin’s ethos is defined as a decentralised storage network designed to store humanity’s most important information. In other words, this transformative technology has the potential to catalyse the restoration of user trust and revolutionise the way individuals and businesses share, store and move their data in an online environment.

While we may not know with exact certainty what the Web’s latest phase will look like in the near future, behind the scenes change is happening and it won’t be too long until tech disruptors manage to re-route the trajectory of the web’s evolution to its original decentralised architecture in their quest for a fairer internet.

Chris Starkey is the founder and director of NexGen Cloud, which is on a mission to bring cheap affordable cloud computing to all. London-headquartered NexGen Cloud is working with Cudo Ventures to disrupt the cloud compute market. With data centre operations established in Sweden and Norway, the company is able to deliver infrastructure-as-a-service cloud computing that is cheaper and greener than the mainstream providers. NexGen Cloud also provides opportunities for investors to access the cloud sector, giving them the chance to share in the growth of the market sector by investing in compute power.

Apart from the general information about how to establish a Dutch holding company, you will also need help regarding tax and other legal matters. Having a plan to know the best nation for your European headquarter needs expertise with proper strategy. A corporate headquarter has two roles. Its administrative responsibilities include monitoring and controlling the actions of group subsidiaries and the entrepreneurial role includes additional sources of value creation.

Here are a few reasons to establish a Dutch holding company:

The Netherlands has a favourable entrepreneurial environment for multinational head offices. Almost all companies can benefit from the Dutch entrepreneurial environment and therefore investing in the Netherlands for expansion is a great idea. Companies like Nike, Netflix, IKEA, Tesla have chosen to set up their European headquarters in the Netherlands.

1. Access to the latest technology and talent

For a well-settled multinational company, you need high-quality technology and human resources. The Netherlands offers you both. The top-notch Dutch digital infrastructure makes the Netherlands an appealing place for foreign investors.

2. Entry to Europe and other International markets

The Netherlands is the perfect entrance to Europe and international markets. Almost 95% of the most profitable markets are within 24 hours reach from Amsterdam. It has high-speed rail connections to the major locations of Europe.

3. Efficiency gains and reduction in cost

A major goal to establish a European holding company is to update your present European activities such as production, distribution, sales and lower operating expenses. Choose a place that has better access to skilled workers. The Netherlands has a very competitive cost in comparison to the other nations. And scores high with regards to the efficacy of its border and customs processes. It offers affordable shipping, top quality logistics and IT infrastructure and top-notch professionalism.

4. Better business environment

By having a European headquarter, you don’t just get a good business climate, but also enjoy amazing tax benefits. As the Netherlands is a globally orientated economy, it has been the goal of the Dutch government to wipe out all the hindrances of international business. The Dutch regulations are professional, transparent and trustworthy.

How to establish a Dutch Holding Company?

In order to set up a Dutch holding company, you should first know which business form is needed. It can either be a Dutch Private Limited Company or a Public Company. Holding isn’t recommended for a specific type of business form. It is used to describe how a business form is applied. There is no different method for the incorporation of a Dutch BV, even if it is used to hold shares.

In the Netherlands, it is common for Dutch operational businesses to set up a Dutch holding company. However, one BV is not a BV so, you need to set up two BVs to properly set up a Dutch business in a BV. The main reason behind it is that the operational activities of a company lead to a lot of prospective liabilities. And, seeing it from a business point of view, it wouldn’t make sense to keep your profit in the same BV. Hence, you should get professional help to establish a holding BV company that allows businessmen to pay dividends to the holding BV and safeguard any claims in the operational company. The operating company is exempted from tax on the payment of dividends and the Holding BV is exempted from tax on the incoming dividend.

Online trading can be a profession or a hobby. Either way it helps to have sophisticated trading software that empowers you to know what's happening with the market in real time. Many traders lose money in the beginning because they haven't learned about the tools that can help them weigh risk with reward. Here's a guide for choosing the right electronic trading technology.

Purpose of Trading Platforms

Trading platforms are computer systems designed to provide traders with analysis along with tools for evaluating the market and making online transactions. As financial researcher Gartner notes on its website, "Trading platforms directly or indirectly facilitate the placement of orders for financial products with another financial entity or intermediary over a network." If you want to read reviews on trading platforms, there are products that can assist you in your research.

Evolution of Trading Platforms

The first electronic trading platforms were used by some brokers in the 1970s over private networks. In this early period, trades weren't executed in real time. The first online trading platforms aimed at retail traders appeared in the early 1990s. The internet became a global sensation by the middle of the decade as online trading became part of the frenzy of the dotcom boom.

In the 2000s, online trading was popularised by CNBC host Jim Cramer, a former hedge fund manager who mixes humor with stock picking. His emphasis has been on short-term swing trading and portfolio diversity. Day trading became trendy in the new century, but many day traders were wiped out due to not practicing risk management or having all the relevant market data at their fingertips. Since then high-frequency trading software has become part of the equation for top pro traders.

Level 1, 2 and 3 Quotes

Understanding the three different levels of market quotes is essential to gaining an edge as a trader and choosing the appropriate software. Most of the stock prices published on popular websites are Level 1 quotes from a system that delivers basic market data such as the best national bid and ask prices for any security. This level is often used by long-term traders who don't care much about daily price fluctuations.

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Levels 2 quotes provide more comprehensive market information, which is why it's the preferred choice of day traders and swing traders. You get up to ten bid and ask prices, enriching you with insights on which direction the market is leaning at any moment in the trading session. Level 3 provides even deeper information, but it's mostly used by brokers and market makers. This level provides up to 20 best bid and ask prices.

Consider Your Trading Style

Professional traders usually develop trading styles that reflect their personalities in terms of how they approach risk management, market research, trade execution and analysis. Each trader has their own unique style, so think about what type of trader you want to be. If you just want to make occasional trades, all you need is a platform that connects with Level 1 quotes. But if you want to make trading your full-time career, you'll need Level 2 quotes.

Ask yourself if you want to immerse yourself in vast amounts of market data on a daily basis. If so, invest in trading software that delivers Level 2 quotes. The more data you analyse, the greater the edge you'll develop over traders who rely on minimal homework and good luck. Another dimension to successful trading is predetermining how you will exit a trade, depending on how the price moves.

Trading platforms commonly provide tools for making various types of market transactions such as buying or shorting stocks. Many pro traders use limit orders to set their own prices and wait for the market to hit their targets. Market orders pose more risk as they are executed at the current market price. Ideally, the software should be seamless, user-friendly and provide up-to-the-second market data.

Conclusion

While being a profitable trader comes down to entry and exit strategies, it helps to conduct your market research, transactions and analysis all on one trading platform. The key to finding the right platform is evaluating how much time you want to devote to participating and studying market activity.

Finance Monthly hears from Andrew Lawson, SVP EMEA at Zendesk, who discusses the growing divide in the banking sector and how retail banks might become competitive once again.

As the economic fallout of COVID-19 continues, businesses feel the pressure to remain resilient and agile in order to stay competitive. And retail banks are no exception. According to the latest World Retail Banking Report, there has been a disconnect between short-term cost-cutting objectives and long-term digital transformation investment needed for incumbent banks to thrive. In fact, the report indicates a disconnect between what customers want and what banks are actually prioritising.

Right now, retail banking customers expect the same service they would get from any other business, and the pandemic is no longer an excuse for poor customer service. Thankfully, Zendesk’s Customer Experience (CX) Trends Report, shows many traditional bricks and mortar financial institutions who were previously slow in the shift to digital, have reacted fast in order to up their service game. The same research indicates that more than half of financial services companies reported that they increased their CX budget in 2020.

Consumer demand is growing for more personalised advice. Existing retail banks have access to decades-worth of data on their customers. When analysed carefully, this data is rich in details on what their customers want most from their bank. How can retail banks use this, to not only inform personal customer interactions but to transform the customer experience they offer for the digital-first culture?

The CX divide in retail banking

Gone are the days of a ‘bank for life’. Digitally native Gen Zers are the least likely generation to stick to their bank, as more than half switched their main bank account within two years of turning 18.

It is clear that younger customers aren’t hesitant to make a change if another provider ticks all of their boxes and delivers on their CX expectations. The rise of digital banking has made it easier than ever to move money between accounts – or, indeed, banks. In fact, with legislation like the 2015 EU Directive PSD2, regulated payment services have put digital and mobile-first banks on a level playing field with traditional high street and household names.

Gone are the days of a ‘bank for life’.

Meanwhile, new banking startups entering the field are transforming customer experience expectations in the banking sector, making it easy for customers to get advice, help and support across many channels with a unified experience. From real-time balance updates to budgeting support solutions and even the ability to split the bill and connect your banking with your friends, these features are now integral parts of the banking experience that incumbents need to match to bridge the divide with challengers.

One digital-first bank that has been able to quickly fill an accelerated experience gap is Mettle. The free business bank account offered by NatWest aims to support the rise in the passion economy. That is, people setting up businesses for the very first time. And, what’s more, the demand for this type of service has skyrocketed, with more than 200,000 new companies formed post-lockdown-1.0. Mettle’s biggest challenge was communications back to its customers. Business founders are traditionally time-poor and as such, expect a fast and seamless service from their banking provider.

With a connected service platform, Mettle has been able to listen, iterate and build upon what is important to its customers. Taking a digital-first approach to banking, with integrated self-service platforms and free accounting software enabled the team to take a more flexible approach to service. Being open to customers about what they can and can’t offer has also been a crucial part of reducing the stress for customers and making banking simpler. Mettle’s customer-centric approach helped grow its customer base by 120% in the second half of last year, and the company to connect their understanding of the customer across the business.

A cultural transition

Another area where CX teams at retail banks can find quick wins is in the delivery of frictionless digital services, which are paramount to remaining resilient in the face of COVID.

Retail banks need to be able to deliver a consistent digital-first service and meet customers where they are, when they need it most. Already, almost three quarters of customer service agents state that they have the tools they need to work remotely and, what’s more, 58% of agents have regular access to support from developers to customise customer solutions, allowing them to remain adaptable to changing needs.

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We see then that a true transformation in the way the industry behaves is here to stay – one built on agility, superior CX and omnichannel banking – but there is still progress to be made. Since the rise of smartphones and app-based banking, customers have come to expect instant access to their accounts - digital banking isn’t just a nice option to have, anymore. As such, financial services organisations will need to find ways to differentiate themselves and remain agile and flexible in an environment of constant change.

Simply being online isn’t enough. Customers want speed and convenience, but they are also seeking commitment to the issues they care about. To keep pace with the ongoing shift in consumer behaviour and expectations, you need to be laser focused in your approach to CX. The bar has been set - and it’s high.

Jay Floyd, Senior Principal Financial Crime Consultant at ACI Worldwide, offers Finance Monthly his thoughts on how banks can keep pace with payments innovation to better protect consumers.

Contactless and digital payments have without doubt grown in popularity during the last year, accelerated by the COVID-19 pandemic and consumers trying to avoid using cash to reduce the spread of the virus. As a consequence, the contactless limit in the UK has recently been increased to £100. While a welcome move for both consumers and the payments ecosystem, this increase comes with the inherent risk of more fraud.

It means a consumer with four debit cards on them now carries a minimum of £400 worth of payments without a PIN, rather than the current £180. This figure is actually likely to be higher, given issuers typically allow five consecutive transactions to be made before a PIN is requested. In this example, that could be up to £2,000 worth of payments. This means your leather wallet is now worth a lot more to a thief than before the limit rise.

As we face one of the worst economic challenges since the 2008 financial crash, banks need to make sure their fraud protection measures are up to scratch. And there needs to be greater consumer education about the risk of making a payment which many now view as a simple ‘tap and don’t think’ action.

Contactless paves road for payments innovation 

Today’s consumers want access to fast and seamless payment experiences. In my view, contactless payments and the increase in limits will pave the way for greater payments innovation in the years to come.

For the broader payment landscape, it’s real-time payments that are leading the way for increased innovation and the growing adoption of different payment technologies - such as QR codes for payments and digital wallets.

Today’s consumers want access to fast and seamless payment experiences.

However, new payments methods and processes always present new opportunities for crime. The recent increase in real-time payment transactions in the UK has sparked an increase in fraudulent activity. UK Finance recently reported that in the first half of 2020, £207.8 million was lost to Authorised Push Payment fraud, with financial institutions only able to return £73.1 million of losses to victims.

The pandemic has further accelerated our move towards a more digital world. While the number of physical bank branches had been declining for some time, recent announcements highlight a rapid acceleration in the closure of bank branches since lockdown. During this process, criminals have adapted their methods of committing fraud, taking advantage of the rising use of contactless and real-time payments. With the adoption rate showing no signs of slowing down, banks need to adapt to the changing landscape and equip themselves with the right measures to protect customers from fraud.

Real-time fraud management solutions will increase fraud detection

Effective fraud prevention requires solutions that can detect all possible types of fraud, across all channels. Real-time payments for example track every step of the transaction processing lifecycle instantly. The good news for banks is this means fraud detection can be instant too.

Through real-time fraud management solutions, banks can increase fraud detection accuracy with advanced machine learning (ML) models to make better informed and faster decisions. It also ensures banks can be confident in remaining compliant with all fraud regulations - such as PSD2 and Anti Money Laundering directives - while delivering the ultimate customer experience.

Combining real-time payments data with ML, network intelligence and community fraud signals, fraud teams can detect fraud to improve overall fraud prevention rates at a much faster pace. Real-time fraud prevention solutions can perform millions of fraud checks within seconds and continuously learn from the data to become more accurate and effective over time.

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Avoiding the financial crime of tomorrow

Fraud trends are moving fast and ultimately fraudsters will always find new ways to make money illegally. While banks have put in place numerous fraud prevention measures since the start of the pandemic, spending habits will continue to change, and they must be prepared to protect customers - and themselves - from the financial crime of tomorrow.

By taking advantage of the benefits of real-time payments technology, banks can put themselves in the best position to detect fraudulent activity and protect consumers and ultimately their reputation.

Application programming interfaces (APIs) are a vital innovation able to transform treasury banking – making financial institutions more agile, innovative and highly experiential to support their clients’ needs, writes BNY Mellon’s Sindhu Vadakath, Head of Global Digital Channels and Asia Payments Product Management.

From real-time payments to account authentication and real-time payment exception handling, digital services have become a prominent part of financial institutions’ (FIs) offerings to treasury customers. Clients are increasingly looking for fast and frictionless experiences throughout the transaction life cycle – including pre-processing, during processing and post-processing. Application programming interfaces (APIs) are providing valuable real-time experiences that help address these needs.

APIs enable streamlined, efficient communication and integration between software components. By using APIs, FIs can offer greater speed and efficiency, and, by harnessing process automation, can provide instantaneous transactional data and actionable insights; as well as real-time visibility over payments, statuses and transactional balances for efficient cash management.

The increasing potential of APIs has been fueling industry innovation, disruption and connectivity, and many FIs have already integrated APIs into their operations. Now, with the ecosystem being driven towards greater levels of harmonisation – through initiatives such as the global migration to the ISO 20022 messaging standard – APIs are beginning to shape the future of banking.

Achieving business goals

APIs can connect the digital ecosystem while bringing numerous back-end and client-facing benefits. A critical advantage of APIs is the ability to integrate real-time balances and transactional data across multiple channels, including Treasury Management Systems (TMS) and Enterprise Resource Planning (ERP). For example, through BNY Mellon’s Treasury Payments API, clients can integrate FIs’ solutions within their own internal systems. Clients can seamlessly perform business operations by automating payment processes, as well as streamline necessary treasury operational tasks such as reconciliation and reporting. Clients can also leverage the technology to securely access global payment capabilities through a single endpoint, enabling them to initiate payments and track the status of transactions end-to-end.

APIs can connect the digital ecosystem while bringing numerous back-end and client-facing benefits.

Through such solutions, clients can enjoy the time and resource saving benefits of real-time data sharing, especially through the pre- and post-transaction processing lifecycles. The automation and streamlining of operational processes allow clients to redirect their resources to more value-generating functions, such as forecasting analysis, customized reporting and transaction capabilities.

Return on investment

After several years of investment in APIs to deliver integration solutions, FIs are already seeing a strong return. Benefits include retaining clients through improved client satisfaction and resiliency, as well as unlocking legacy data and eliminating manual processing.

And APIs now play an important role in business continuity plans (BCPs). The importance of having an established plan to offset against the impact of unexpected events has been confirmed by the COVID-19 pandemic. In the case of a disruption or network outage, FIs are using APIs to seamlessly switch to a digital, active-active alternate channel to process their payments – traditionally, a resource-heavy process between FIs and network providers to ensure timely execution without any financial implications. By integrating APIs into their networks, FIs can smoothly transition to their back-up plans during such exigencies.

For banks such as BNY Mellon, integrating APIs with their clients’ operations is a way of offering value-driven, tailor-made solutions to support business agility and innovation for clients. As opposed to a one-size fits all approach where offering a standard product isn’t the goal, APIs provide a solution-based target where the client can be kept at the center, and their unique needs – whether that be authentication, validation services, exception handling, or real-time access to data and reporting on payments and account activity to take timely actions – can be solved through APIs and other digital capabilities.

Looking to the future

While the finance industry is learning to leverage API technology, the size and complexity of the solution required can sometimes impede the success of delivery. For example, an API might need to work for multiple parties across various jurisdictions that are each bound by regulations in their domestic markets. As a result, a number of consortiums, formed by both fintech and financial firms, are working on ways to resolve these issues.

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In fact, FIs are responding through collaboration and partnerships – with each other, with fintechs, and with industry networks and participants, such as SWIFT. Where FIs focus on upgrading legacy systems and data architecture, they see opportunities to partner with fintechs to accelerate the process. Meanwhile, FIs can offer fintechs with real world client use cases, problem statements and the ability to deliver their innovations across a range of situations and sectors, leveraging each other’s expertise to address industry needs to stay relevant.

One of the biggest challenges for adoption is the difficulty in maintaining multiple variations of the message specifications by channels, currency and markets. However, the way to overcome this challenge is through increased standardisation, and the upcoming migration to ISO 20022 could reduce a lot of these frictions, by improving cross-border interoperability and streamlining the exchange of data for APIs. It is going to be a journey towards harmonisation that requires the industry to come together to chart the path towards the digital future.

As FIs continue to invest in new technologies and further leverage the benefits of APIs, they move closer to not only achieving their strategic business goals, but also enabling their clients’ own digital transformation goals. Banks and other FIs have the responsibility to continue to explore agile, innovative and integrated API solutions, ensuring that clients can benefit from the host of opportunities APIs will bring as they shape the future of the industry.

The views expressed herein are those of the author only and may not reflect the views of BNY Mellon. This does not constitute Treasury Services advice, or any other business or legal advice, and it should not be relied upon as such.

Amsterdam-based tech investor Prosus NV netted $14.6 billion overnight from the sale of a 2% stake in Tencent, the company announced on Thursday.

A filing from Tencent at the Hong Kong Stock Exchange revealed that Prosus had sold 191.89 million shares at HK$595.00 per share.

“Our belief in Tencent and its management team is steadfast, but we also need to fund continued growth in our core business lines and emerging sectors,” Prosus Chairman Koos Bekker said in a statement on Thursday, hours after the completion of the deal.

Prosus is majority owned by Naspers of South Africa. The Wednesday night sale lowered its stake in Tencent from 30.9% to 28.9% -- a level which the company has committed to not reducing any further for the next three years.

“The proceeds of the sale will increase our financial flexibility, enabling us to invest in the significant growth potential we see across the group, as well as in our own stock,” Prosus CEO Bob van Dijk said in a statement.

Tencent Chairman Pony Ma acknowledged the sale and reaffirmed that he viewed Prosus as having been a “committed strategic partner over a great many years”. He also stated that “Tencent respects and understands” the firm’s decision to sell.

Tencent Holdings, headquartered in Shenzhen, is one of the largest companies in China. The conglomerate focuses primarily on internet-related services and products, including video games and social media.

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Though not a household name outside of China, the company made international headlines as it butted heads with the Trump administration over an executive order banning US firms from doing business with its social media subsidiary, WeChat.