In 2010, people owned 12.5 billion networked devices; whilst it is estimated that by 2025 this number will have climbed to more than 50 billion.

While the IoT has already impacted sectors such as manufacturing and healthcare, it is still a nascent technology in the world of banking. Research has found that banks have still not implemented IoT technologies within their organisations or in their products or services. In the long term, however, this is set to change. Reports have shown that 40% of financial services businesses are currently experimenting with IoT and big data.

Given the wealth of statistical data which can be gathered from a range of devices within an IoT network, the applications of IoT and big data can go hand in hand. For example, retail banks can combine IoT and big data to offer increasingly personalised services to customers. Rather than providing a ‘one size fits all’ approach, banks can create personalised offers to customers by using IoT capabilities to analyse various aspects of its customers’ behaviour - including the regularity in which they visit merchants or purchase from them - and offer bespoke budgeting plans or financial products relevant to their lifestyles. Furthermore, the data from wearable payments technologies, for instance, could be used to help build detailed customer profiles and enable fraud detection. The same data could also enable banking institutions to build partnerships with brands that can push relevant deals through to banking customers in the area, enabling even closer relationships with customers and providing more useful perks.

The benefits of IoT services within the financial sector aren’t just limited to retail banks. Insurers can use IoT capabilities to aid interactions with customers and to accelerate and simplify underwriting and claims processing, as well as default prediction.

The benefits of IoT services within the financial sector aren’t just limited to retail banks.

It can also help insurance companies to determine risk more precisely. Automotive insurers, for example, have historically relied on indirect indicators, such as age, address, and creditworthiness of a driver when setting premiums. Now, data on driver behaviour and the use of a vehicle, such as how fast the vehicle is driven and how often it is driven at night, are available. These new data sets can help insurers provide premiums that more accurately reflect their consumers.

Another application of IoT within the financial sector that has the potential for huge implications is in trade finance. International trade flows are currently expensive and predominantly paper-based due to the inefficiency of the supply chain in moving goods. IoT within trade finance can be used to make these processes quicker by tracking movement, supply and demand. This can significantly improve the efficiency of the process by reducing the cost and risk for the enterprise. However, in order to have any meaningful impact on trade finance, there would need to be a large scale, global adoption of IoT - allowing every part of the ecosystem to be accounted for and creating a seamless process.

If key issues around cybersecurity can be overcome, the IoT presents a huge opportunity for the banking sector. And there will certainly be disruptors willing to provide that access - so the time is now for banks to start thinking about technology development that will take advantage of this before a competitor gets there first.

Authored by David Murphy, Managing Partner, Financial Services EMEA at Publicis Sapient.

According to Mark Judd, VP, HCM Product Strategy, EMEA at Workday, embracing technologies such as automation and artificial intelligence, payroll professionals can ditch processes, create more enhanced payroll services, and get closer to their employees.

Up to 97% of employers believe that employee expectations of their workplace experiences are changing, according to Aon’s 2019 Benefits and Trends Survey. Workers increasingly expect their employers to deliver seamless, personalised and human services, which mirror those they receive in their personal lives. This has prompted businesses to re-examine all the ways they interact with employees, with arguably the most important interaction being payroll.

Personalised pay

For years, companies took a one-size-fits-all approach to the services they delivered to employees. However, staff now expect smarter and more contextual interactions with their employers. Personalised payroll, adapted to the wants and needs of different employees, is a prime example.

An increasingly popular form of personalisation in payroll is on-demand pay. Through on-demand pay schemes, employers can offer staff greater flexibility over when they’re paid and offer the chance to access a percentage of their pay at the end of each day or week, for example. This increases employees’ ability to handle unexpected payments and can help them to better manage their finances. This could be highly valuable to employees, given that over 50 percent of young Britons currently live “hand to mouth”, according to research from Perkbox.

By personalising pay, businesses can recognise each employee’s situation and needs, enhance their experience and improve loyalty across the workforce.

Feedback loop

Feedback is key to successfully personalising pay arrangements and wider payroll functions. Not only does it help businesses to improve their services, but it also boosts employee engagement. After all, employees have come to expect their feedback to be heard and incorporated into process updates, in the same way, it would be in their personal lives as consumers.

Regular focus groups and routine employee surveys are great ways to gather feedback, and particularly effective if workers can contribute on their mobile devices. By connecting this feedback with the payroll team and wider HR function, organisations can make sure the voice of the employee is present when operational decisions are made.

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Providing education

Employees often request assistance in understanding their payslips and pay structure. In fact, over a quarter of respondents to the CIPP’s 2019 Future of Payroll survey reported an increase in the volume of payroll enquiries they received. A part of payroll’s function should be to educate the workforce on how payroll works. From promoting the payroll calendar to an understanding of payslips and the inner workings of pay, this will help employees across the workforce to get the most out of this function.

However, to meet staff expectations, for both education and seamless services, there needs to be a shift to digital payroll platforms. For instance, modern payroll technology can allow employees to access information about how they are paid and find answers to commonly asked questions. This, alongside process automation, helps free up payroll professionals so that they can spend time working with people to resolve more complex queries.

Embracing technology

Technology has a big role to play in the consumerisation of payroll. Complex, legacy systems that currently take several days to process payments and keep the employee at a distance will be consigned to the past. They will be replaced with simpler, less labour-intensive systems that take a more holistic view of the employee and their needs.

Solutions, such as machine learning, robotic process automation (RPA), blockchain and digital credentialing, will also create new opportunities for employers to increase process efficiencies and improve compliance management, so they can focus more on employee experiences.

Feedback is key to successfully personalising pay arrangements and wider payroll functions. Not only does it help businesses to improve their services, but it also boosts employee engagement.

The consumerisation of payroll

In a competitive job market where it’s difficult to retain talent, businesses should understand how each employee interaction impacts the overall experience and what can be done to improve it. No interaction is more important than the way a company pays its employees. Understanding the needs of each individual and giving them greater flexibility and control over how they’re paid can turn something that was once transactional, into something that feels a bit more personal.

The potential for PropTech (any innovative technology or business that plays across/within any of the real estate segments) to disrupt the industry is therefore massive. Christina Reti, Senior Client Partner at Korn Ferry, tells us more about it.

Entrepreneurs have recognised this, as have investors. This doesn’t only include VCs: traditional RE companies, as well as RE and Sovereign Wealth Funds, are all looking at how best to take advantage of the array of opportunities. In 2018, PropTech start-ups attracted more than $20bn in early-stage funding, up 32% in 2017 and this is predicted to increase again in 2019 and 2020. The range of start-ups are diverse, but roughly fall into four verticals:

• Smart Real Estate - technology-based platforms which facilitate the operation and management of real estate assets. The assets can be single property units or entire cities.
• The Shared Economy - technology-based platforms which facilitate the use of real estate assets. The assets can be land or buildings, including all property types.
• Real Estate FinTech - technology-based platforms which facilitate the trading of real estate asset ownership. The sector supports the real estate capital markets.
• Construction Tech - focused on the ‘built world’, involving architects, engineers, construction firms and facilities managers.

Given the scale and complexity of the opportunity these verticals provide, early-stage all isn’t an option when it comes to talent. A business cannot rely on a founding team of “identikit” investment bankers to thrive, nor a management team who have spent their entire careers in the real estate industry. Conversely, a group of technology experts without sector knowledge could quickly become mired in regulations and stumbling blocks the Real Estate experts could avoid. A diversified team, with a range of expertise and experiences, is essential for any start-up that wishes to succeed.

PropTech players respond     

Although PropTech is still thought of as a nascent industry, the reality is that some verticals are more established and this allows us to draw some conclusions about the future of talent. The Shared Economy sector is booming, with well-known examples including WeWork and AirBnB, both of whom have already disrupted the market for talent. If we take the open opportunities on the Airbnb website, over 25% of the roles are within Product, Data Science & Engineering.  The rest fall within the spectrum of marketing, operational roles (including customer service and recruitment) and finance. Over time, the balance of these roles will change – at early stage for example, we would expect product/data science roles to be a much in proportion, followed by marketing, with operational and finance roles being a lower priority – but it’s clear that these four pillars of expertise need to evolve together. Getting the right balance at the right growth stage is essential for progression from seed to Series A funding and onwards to pre-IPO.

Although PropTech is still thought of as a nascent industry, the reality is that some verticals are more established and this allows us to draw some conclusions about the future of talent.

Grasping the investment opportunity 

Talent disruption is not limited to start-ups: we’ve also witnessed the emergence of innovative specialised investors, with hybrid capabilities, combining real estate and data technology expertise. This new breed of capital challenges the classical VC fund model and offers an alternative for PropTech start-ups looking to grow.

A/O PropTech is at the forefront of re-thinking the traditional investment model for PropTech.  Having anchored this innovative approach in Europe, combining deep data-tech and real estate know-how with large scale owned and operated RE portfolio, it invests permanent capital to support entrepreneurs and start-ups looking to disrupt the world’s largest asset class.

As Gregory Dewerpe, A/O PropTech founder, explains: "By being a fully integrated player, with hybrid investment capabilities, deep industry knowledge and significant strategic RE portfolio, we position ourselves as a unique enabler for companies looking to reimagine, create, incubate, iterate, scale and disrupt the real estate ecosystem. Our permanent capital approach creates a complete alignment with entrepreneurs, removing structural timing limitation and potential inefficiencies from the decision-making process, allowing to us be stage agnostic and focus on investments where we can be relevant and strategic with our assets, network, and ecosystem”.

By reshaping the eco-system from within into something more efficient, transparent, accessible and connected, these new investors help to transform the sector.

Final thoughts

Whilst no-one can tell the future, we can learn from the examples of the past. The maturation of other tech verticals (e.g. MarTech and FinTech) has already disrupted talent pools and over the years we’ve both seen and been involved in the transformative path that they’ve taken. By applying this to PropTech, we’re well-placed to anticipate the high-level changes in talent and team building that are required as the industry continues to evolve.

More than half (58%) of UK banks are currently looking for greater in-house technology skills with 48% either recruiting extra skills or using partners to gain the skills they need, research commissioned by fintech provider Fraedom has found.

The report also revealed that more than one-third (38%) of banks say they are likely to invest in recruitment as a priority in order to find specific skills. Currently, banks most want to attract technology risk analysts (32%), data scientists (30%) and network specialists (24%) as they address their financial ecosystem.

Russell Bennett, CEO at Fraedom said: “We can see that there is a great opportunity for banks to partner with fintechs to uncover the skills they need and how best to attract them, whether that be by recruiting or upskilling existing employees. These partnerships would be particularly beneficial as, at present, 34% of banks feel they don’t have the expertise in-house to implement new technology. Fintechs can help banks gain a greater understanding of what technology they need which also will be instrumental in attracting new talent, especially as the younger generations progress in their careers and expect to have access to the latest technology.”

As banks have placed a greater emphasis on upskilling employees, Fraedom found that over the past five years, 60% of banks have improved in-house training courses, while 36% have implemented new external training schemes.

Looking to the future, to further develop skills in-house, 28% of banks are putting new internal training schemes in place and 20% plan to send staff on external training programmes.

“Banks are not just focusing on recruiting new talent to gain a broader range of skills but are also looking to retain their existing talent and provide the tools they need to grow with the pace of the technology. They can also partner with fintechs to harness the talent and experience they already have in the company to support their use of technology. To get the most from these activities, banks must prioritise creating the right culture which gives the freedom and flexibility that most employees in technical and development roles desire,” added Bennett. “Financial organisations across the sector are all competing to attract the best talent, so it’s vital they create points of differentiation within their culture so as to be the most attractive.”

(Source: Fraedom)

Of course, the rise of Human Factors Analysis Tools (HFAT) has forced financial services firms to push the envelope, but AI is gradually beginning to be integrated into the operations of firms across other industries. Perhaps, one sector which lags behind is insurance. However, according to Nikolas Kairinos, CEO and Founder of Fountech, attitudes are definitely shifting and in large part, this is due to the possibilities presented by AI toolsets.

Indeed, the venture capital community considers the insurance industry to be so ripe for disruption that Lemonade, a US InsurTech company, managed to raise $300 million in seed funding earlier this year. As an AI developer myself, I believe that the technology can drastically improve insurers at all levels, but only if industry leaders understand what AI actually offers and how to effectively integrate it into their organisations.

AI in InsurTech

The first, and arguably, most important part of this process, is having a sophisticated awareness of what AI in insurance actually means. For most firms, the benefits of AI actually come through robotic process automation (RPA); in other words, automating existing processes to save time and resources. For example, insurance AI exists which could remove the need for firms to manually classify documents, write contracts or process claims.

However, the most significant advantage that AI offers to insurance firms specifically stems from the way in which sophisticated algorithms can use vast datasets in order to predict and monitor risk. This would have many applications across the crucial functions of underwriting, pricing and risk management. Going further, the technology could even be used to prevent fraud by detecting tiny inconsistencies in either publicly available data or a client’s financial history.

However, AI doesn’t simply provide a competitive advantage for the forward-thinking firms who employ it, it also benefits policyholders who would enjoy cheaper premiums as a result of lower overheads and reductions in the amount of fraud.

Managing the transition

Still, some within the industry remain apprehensive about the impact of AI on either the employees or customer base of an insurance firm. The first thing is to say that many of these concerns, particularly around data security, are legitimate but it’s important that industry leaders do not see these apprehensions as an insurmountable obstacle. Integrating AI is not about saving resources for the sake of it but rather adopting new tools with the potential to improve the industry as a whole.

I’ve been developing software for professional services companies for years and based on what I have seen, I believe that successfully integrating AI into your services boils down to three things. Understanding the limitations of both the technology and your organisation, working with developers as much as budget and time constraints allow and being critical about where and why you’re integrating AI into your company’s operations.

At Fountech, we think it’s important for firms to understand what AI has to offer the insurance industry, and so we recently released a new white paper which explores how insurers might integrate AI into their business. Ultimately, with a proper understanding of AI’s strengths and limitations, industry leaders can begin adapting their firms to the rigours of the new data-driven landscape.

Towards a more intelligent future

As AI begins to play a central role in the functioning of insurance firms, it’s important that industry leaders remain invested in the technology’s potential to change insurance for the better. At root, this means having a sophisticated understanding of how AI can benefit your organisation but also remaining vigilant to any problems that might arise as a result.

Finally, as we move towards a more data-driven insurance industry, it’s essential that insurance firms begin playing a more active role in the development of new AI either through investment, active feedback, or by providing a breeding ground for new tools to be refined. Now is the time for insurance firms to begin playing a more active role in the development of the tools that are going to fundamentally reshape the industry over the next few years.

But, really, this is about a tech company moving into banking by launching a credit card. The card, albeit revolutionary for Apple’s product line, is fairly similar to products offered by challenger banks such as Monzo and Starling Bank. The new credit card allows users to pay for products through an extension of Apple Pay; only rather than Apple Pay acting as a vehicle for other payment cards and services, it will allow users to use the Apple credit card.

Although this may seem like an easy sell for Apple, as the credit card is a simple add-on for existing iPhone users, the success of the new service will be based on the company’s ability to convince consumers to switch current accounts.

Even for the likes of Apple, with its huge resources and strong established brand, this will be a difficult and challenging task. The Competition and Markets Authority (CMA) in February found that only 3% of people switch bank accounts in any one year and in the US the Retail Banking Satisfaction Study found that 4% of consumers switched primary banks in 2018.

Although this may seem like an easy sell for Apple, as the credit card is a simple add-on for existing iPhone users, the success of the new service will be based on the company’s ability to convince consumers to switch current accounts.

Despite consumers feeling reluctant to switch current accounts, Apple has cause to believe that it can defy the odds. The company has repeatedly beat competitors in established markets from computers with the launch of the Macintosh in 1984, to the mobile market with the launch of the iPhone in 2007. Plus it has a strong well-loved brand (the company is the most beloved brand in the world according to Forbes) and a network of iPhones around the world to support and promote the new service.

However, relying on the brand alone won’t be enough to convince consumers to use the Apple Card. Unlike a new computer or phone, consumers aren’t willing to experiment on who they bank with. In fact, according to a 2016 report from the CMA, customers don’t switch current account unless they have a problem with their bank, with most thinking that they have little to gain financially by moving.

Apple needs to develop a strong and effective marketing strategy in order to convince consumers to use the Apple Card, otherwise, the tech giant will find that consumers are unwilling to make the leap into using the new Apple Card over the likes of Monzo, Barclays and other banking services.

According to a 2016 report from the CMA, customers don’t switch current account unless they have a problem with their bank, with most thinking that they have little to gain financially by moving.

However, what would this marketing strategy look like? Firstly, Apple needs to target its ads to existing Apple users. Fans of the Apple brand are more likely to buy a range of Apple products from the iPhone to the iPad and therefore may be more willing to use the Apple Card. In fact, Apple’s customer loyalty is so strong that a survey found that 92% of current iPhone owners are "somewhat or extremely likely" to purchase a new iPhone as an upgrade over the next 12 months. This is compared to Samsung on 77%, 59% for LG, 56% for Motorola, and 42% for Nokia.

Apple can target these existing fans in a multitude of ways. Through search engines, Apple can target fans by leveraging keywords such as “Apple” and “iPhone”, while on social platforms like Facebook and Twitter it can target users based on likes and searches related to the tech giant. When reaching people out of home, the company can use physical billboards located near Apple stores to target users as they are actively seeking out new Apple products.

Apple also needs to position itself alongside the same lines as challenger banks such as Monzo, Starling Bank and Revolut. These newly created banks have grown rapidly with younger consumers over the last few years, despite the fact that consumers are reluctant to switch their current accounts. Take Monzo, the digital bank hit 300,000 customer mark earlier this year due to the fact that it positions itself as cool and innovative in its marketing messaging. It also positions itself as a supplementary account with Monzo CEO Tom Blomfield telling Reuters that only 30% of its users are using the app as their main bank account.

Without considering the messaging and advertising channels for the Apple Card, the tech giant will find that it no longer has the fabled Apple mystique. While the company has long been able to enter new markets and disrupt sectors, the launch of the Apple Card presents the tech giant with a different and more regulated sector. It is therefore clear that Apple needs to create and deliver a marketing strategy that targets people who use Apple products and that addresses concerns around switching banks.

We live in a digital world, and the financial industry is no exception. Eschewing traditional methods, finance has merged with technology to create a whole new sector, FinTech, that is changing the way we manage our money in a big way.

With banks and other established financial institutions cutting jobs in favour of automatic processes and AI, it's no surprise that many people in the industry are turning to FinTech for career opportunities instead. Plus, there's a lot of investments being made in FinTech start-ups and they have incredible potential for growth, so you could end up making more money if you find the right position.

So, whether you're looking to start somewhere fresh or are just after something more lucrative, here are the three things to consider when making the change from finance to FinTech.

Identify your transferrable skills

You don't necessarily need to be an expert in technology to find your place in FinTech. FinTech refers to the use of technology in any aspect of financial service, including markets, banking, payments, and insurance. There's such a broad area of focus that you'll likely find a company to suit your interests whatever they may be. And, whether you're technologically inclined or not, your experience in finance will be invaluable for identifying and assessing opportunities that technology specialists might overlook.

You know how the financial industry works and you have regulatory knowledge, which means you have valuable insight into the possibilities and limitations posed by standards, which will be useful when designing financial technology.

You know how the financial industry works and you have regulatory knowledge, which means you have valuable insight into the possibilities and limitations posed by standards, which will be useful when designing financial technology. Most importantly, though, FinTech companies are very data-driven, so you'll continue to be expected to use numbers and data to make business decisions.

It's also important to consider any other valuable professional skills that you've acquired in your previous roles, like communication and management. These are the kinds of qualities that will set you apart in any business, so it's just as necessary to draw attention to them as well as your financial background.

Aim for the right companies and roles

If you don't have a strong background in technology, don't worry. You could focus on looking for roles at FinTech companies in financial analysis, accounting, credit risk analysis, risk management, and compliance, as these are good roles for financial specialists to fill. The big question, though, is where to apply.

There's a lot of FinTech start-ups to choose from and not all of them will last, so working out which companies to approach can feel like a bit of a gamble.

Early-stage start-ups will probably ask you to take on a more dynamic role, which is certainly a chance to gain more responsibility, but it means you have to be much more invested in the company than you would normally be. Make sure you ask potential employers about their future goals before you accept these sorts of positions to determine whether they are in line with your own aspirations.

If you're looking for a position with more job security, remember that it's not only start-ups that are focussing on FinTech.

Additionally, start-ups have to be fluid but also capable enough to adapt to unexpected challenges and opportunities. Although there's a lot of money being pumped into FinTech start-ups, a lot of them will fail. So, if you have any concerns that their plans for the future won't provide you with the career you need, you'll be better off looking at one of the many other FinTech companies out there.

If you're looking for a position with more job security, remember that it's not only start-ups that are focussing on FinTech. Established financial institutions are also working out ways to combine finance and technology to keep up with industry trends, so don't rule out looking for major opportunities in places like HSBC and Citibank as well.

Continue to nail networking

Networking is always important if you want to keep abreast of news and job opportunities within your sector, but it is especially useful if you're thinking about changing from a career in finance to FinTech. It's a fast-moving sector, so by attending events such as new app launches you can get a better idea of the structure of the industry, the upcoming trends, and the sorts of positions available that might suit your experience. You may also begin to recognise some little-known companies and their representatives that you can add to your list of potential employers, as well as pick up some technological knowledge.

The buzz around FinTech means that you won't be the only person you know who's thinking about transitioning, so you don't need to be shy about building relationships with like-minded professionals. They might be able to share tips and recommend places to you if they find their way into FinTech, so make sure you keep in touch with fellow job-hunters you think have the potential to become valuable through social media.

Identify your transferrable skills, find the right company, and up your networking game. Focussing on these three areas can help you make a smooth transition from finance to FinTech and find the best opportunity for you.

It is no secret that cybercrime continues to rise, due to a large extent from data breaches that have exposed our digital identity information, says Monica Pal, CEO of 4iQ.

Last year, 4iQ discovered 14.9 billion raw identity records that were stolen from companies and circulated across the web. The rate of identity breaches alarmingly increased by 424% since 2017, totalling 12,499 breaches. It’s no surprise that the likes of Google and Facebook made all the headlines—these tech giants have millions of consumers who were affected. However, one narrative that does not get enough attention, yet is vitally important, is that the businesses employing these consumers also suffer huge consequences due to the massive expansions in their risk profiles. Certain stakeholders (employees, customers, etc.) with poor cyber hygiene, or who have had their data exfiltrated in the past, are just as, if not more, threatening to an organisation than a cybercriminal with harmful intentions. The financial services industry arguably faces the most danger.

More than 25% of all malware attacks target the financial services industry - this is more than any other field, and to make matters worse, attacks are continuing to rise. The number of compromised credit cards increased by 212% in 2019 compared with the prior year, while credential leaks rose by 129% and instances of malicious apps increased by 102%.

Trojans are being used to attack financial services companies. ATM malware is being used to steal credit and debit card information. This issue isn’t exclusive to the United States, as we just saw a ransomware attack wreak havoc on Mexico’s major financial institutions. In February, a UK-based bank became the first public victim of SMS verification code interception. What’s more, cybercriminals can still leverage older methods such as DDoS attacks and phishing against the least prepared companies.

More than 25% of all malware attacks target the financial services industry - this is more than any other field, and to make matters worse, attacks are continuing to rise.

The increasing digitisation of financial services, via cashless payments with cards and mobile apps, has led to greater overall digital capital flow, and as more capital circulates in the digital marketplace, companies increasingly become more vulnerable to cyberattacks. Simultaneously, automation of cybercrime is more common. Crawlers can continuously and automatically sift through large amounts of data and search for vulnerabilities and exposed networks, sometimes even without user input, helping malicious actors acquire their targets more rapidly. And as these processes become more automated,  the ease with which it is done lowers the threshold of expertise required for operation, widening the opportunities to include bad actors with less technical expertise.

Aside from a reputational impact, data breaches incur high financial costs as well. Equifax’s infamous breach cost the company more than $600 million. JP Morgan Chase said it would spend $250 million annually to improve its digital security following its 2014 data breach. Estimates are that cybersecurity costs companies within the financial services industry, on average, about $2,300 per employee, while some firms pay up to $3,000. These numbers have tripled within the last three to four years – showing that companies are spending more on cyber and digital protection than ever before.

Yet, despite companies investing more to secure infrastructures, protect critical business data and assure customer privacy, cybercriminals remain undeterred and have responded to more sophisticated protections by rapidly evolving their method of attacks. What few companies consider, however, is the cumulative effects of other companies’ breaches which have already happened. An employee’s or partner’s personal information exfiltrated in one breach is often used subsequently to gain unauthorised access to another infrastructure, whether through password re-use or social engineering attacks. This is akin to locking the front door, turning on the alarm, yet leaving the garage open, and can be devastating to enterprise-level targets which stand to lose a trove of company IP, inside information about mergers and acquisitions, and more.

What few companies consider, however, is the cumulative effects of other companies’ breaches which have already happened.

Cybercriminals, clearly, possess a myriad of ways to outsmart and outpace normal security measures, so there needs to be an overhaul in this industry, placing more of an emphasis on thinking proactively and aggressively, unmasking bad actors’ identities and anticipating how our data could be at risk. Today, most leading companies understand the importance of executing traditional financial and criminal background checks for their employees. Too few leaders understand how to do this for the hygiene of employees’ digital footprints.

More and more, financial services companies are incorporating identity intelligence into their digital security. This involves tools and practices that are focused on scouring the Deep Dark Web for known exfiltration of identity-related data, from usernames and passwords to social security numbers and addresses. Identity intelligence helps large banks, credit card issuers and insurers understand and reduce what we call the “employee attack surface”, which is created by prior breaches.

These tools and practices can help companies avoid problems caused by:
Password Reuse: Criminals use credentials from prior breaches to access accounts on otherwise secure banking and credit card sites. A July study commissioned by 4iQ showed that nearly half of the consumers surveyed admitted to reusing passwords across multiple websites. Many financial services websites force regular resets – but some don’t, which is a glaring problem with a simple solution.

Weakest Link in the Chain: As we’ve seen in the news recently, third-party vendors play a key role in a company’s security. All players in the supply chain must be doing their very best to mitigate their risk profiles, and scarily enough, your company’s efforts can be all for nought if a “trusted” partner is not doing its part.

Employee Training (or lack thereof): Whether it’s a lack of training, willful negligence, or a bit of both, a company can invest millions of dollars on improving security measures only for an employee, no matter how high or low-level they may be, to make a costly mistake.

As cybercriminals have more tools at their disposal than ever before, technical threat intelligence about a company’s IT infrastructure is simply not enough. Organisations must adopt a more proactive, agile and strategic approach, beyond just playing “whack-a-mole” in response to an attack. Identity intelligence equips incident response and forensic professionals with the information they need to accurately anticipate attacks and catch warning signs even earlier, thereby avoiding a devastating attack for their company.

But it is the speed at which the technological advancements have reached that has forced traditionally slow-moving financial institutions to heavily invest to remain relevant to their consumers and remain competitive in the marketplace.

Personal

Banking is one of the oldest businesses in the world, going back centuries ago, in fact, the oldest bank in operation today is the Monte dei Paschi di Siena, founded in 1472. The first instance of a non-cash transaction came in the 20^th century, when charga-plates were first invented. Considered a predecessor to the credit card, department stores brought these out to select customers and each time a purchase was made, the plates would be pressed and inked onto a sales slip.

At the end of the sales cycle, customers were expected to pay what they were owed to the store, however due to their singular location use, it made them rather limiting, thus paving way for the credit card, where customers that had access to one could apply the same transactional process to multiple stores and stations, all in one place.

Contactless

The way in which we conduct our leisurely expenditure has changed that much that we can now pay for services on our watches, but it wasn’t always this easy. Just over a few decades ago, individuals were expected to physically travel to their nearest bank to pay their bills, and had no choice but to carry around loose change and cash on their person, a practice that is a dying art in today’s society, kept afloat by the reducing population born before technology.

Although the first instances of contactless cards came about in the mid-90’s, the very first contactless cards associated with banking were first brought into circulation by Barclaycard in 2008, with now more than £40 million being issued, despite there being an initial skepticism towards the unfamiliar use of this type of payment method.

Business

Due to the changes in the financial industry leaning heavily towards a more virtual experience, traditional brick and mortar banks where the older generation still go to, to sort out their finances. Banks are closing at a rate of 60 per month nationwide, with some villages, such as Llandysul closing all four of its banks along with a post office leaving it a ghost town.

The elderly residents of the small town were then forced into a 30-mile round trip in order to access her nearest banking services. With technology not for everyone, those that weren’t taught technology at a younger age or at all are feeling the effects most, almost feeling shut out, despite many banks offering day-to-day banking services through more than 11,000 post office branches, offering yet a lifeline for those struggling with the new business model of financial firms.

Future innovations

As the bracket of people who have grown up around technology widens, the demand for a contemporary banking service continues to encourage the banking industries to stay on their toes as far as the newest innovations go.

Pierre Vannineuse, CEO and Founder of Alternative Investment firm Alpha Blue Ocean, gives his comments about the future of banking services, saying: “Artificial intelligence is continuing to brew in the background and will no doubt feature prominently in the years to come. With many automated chatbots and virtual assistants already taking most of the customer service roles, we are bound to see a more prominent role of AI in how transactions are processed from all levels.”

Technology may have taken its time to get to where it is now, but the way in which it adapts and updates in the modern era has allowed it to quicken its own pace so that new processes spring up thick and fast. Technology has given us a sense of instant gratification, either in business or in leisure, we want things done now not in day or a week down the line.

Sources:

https://www.sysco-software.com/7-emerging-trends-that-are-changing-finance-1-evolving-cfo-role/

https://www.vox.com/ad/16554798/banking-technology-credit-debit-cards

https://transferwise.com/gb/blog/5-ways-technology-has-changed-banking

https://www.forbes.com/sites/forbesfinancecouncil/2016/08/30/five-major-changes-that-will-impact-the-finance-industry-in-the-next-two-years/#61cbe952ae3e

Digital banks raised over $1.1bn in fresh funding throughout 2018 in Britain, a figure that is set to be dwarfed if the current pace of growth continues to demand the attention of investors. Claudio Alvarez, Partner at GP Bullhound, explains for Finance Monthly.

Europe is truly leading the fintech charge, accounting for roughly a third of global fundraising deals in 2019, up from only 15% in the fourth quarter of 2018 according to our data. These are digital firms raising globally significant levels of capital. Adyen, the Dutch payment system, is now one of the frontrunners to become Europe’s first titan, valued at over $50bn. Europe has become a breeding ground for businesses that can go on to challenge US tech dominance, and it is fintech where we will find most success. Europe’s unique capacity for incubating disruptors is a phenomenal trend to have emerged over the past few years.

It’s true, European culture has always been more open to contactless and cashless, in contrast the US, where legislation and the existing banking infrastructure make adopting new technologies in banking slower and more convoluted. Europe has been able to take an early lead, while the US remains fixed on dollar bills.

As the ecosystem evolves, borders will become less relevant and markets more integrated, allowing the big players based in Europe to expand into further geographies with greater ease. European success garners the growth, momentum and trust needed to brave new regions and cultures. Monzo won’t be alone in the US for long.

As the ecosystem evolves, borders will become less relevant and markets more integrated, allowing the big players based in Europe to expand into further geographies with greater ease.

Whilst the Americans’ slow start has allowed European start-ups to become global players, it’s also true that the regulatory environment has distracted the European big banks and opened up the space for innovative and disruptive newcomers. While PSD2 has eaten up the resources of the incumbents, the likes of Monzo and Revolut have focused on consumer experience, product development and fundraising. The result? Newcomers are able to solve problems that older institutions simply don’t have the capacity to address.

However, a word of warning: traditional bricks and mortar banks aren’t dead yet. For one, digital banks will still need to justify the enormous valuations they’ve secured recently, and will have only proved their worth if, in 3 to 5 years’ time, they have managed to persuade consumers to transfer their primary accounts to them, which would allow digital banks to effectively execute on their financial marketplace strategies

Meanwhile, traditional banking institutions have a plethora of options to fend off the fintech threat and most are developing apps and systems that mimic those created by the digital counterparts. Innovation isn’t going to come from internal teams – it needs to be a priority for the old players and they need to invest in third party solutions to excel as truly functional digital platforms in a timely manner. In the first instance, the traditional banks will need to solve the issues that pushed consumers towards the fintechs and secondly, work on attracting consumers to stay by offering, and bettering, the services that make fintech’s most attractive.

Competition breeds innovation. For the fintech ecosystem as a whole, this new need for advancement is only good news – a rising tide lifts all ships. As traditional banks try to innovate and keep pace, we’ll see them investing in other verticals in the fintech market. Banks’ global total IT spend is forecast to reach $297bn by 2021, with cloud-based core banking platforms taking centre stage. Digital banking may have been the first firing pistol, but the knock-on effect of the fintech revolution is being felt across the board.

The fintech boom shows no sign of bust, market confidence is riding high and will continue supporting rapid growth. The aggressive advance of digital banks has opened doors for a whole host of fintech innovation - from cloud-based banking platforms to innovation in the payments sector. The number of verticals that sit within financial services creates a plethora of opportunity for ambitious and bullish fintechs to seize the day.

Employees essentially keep the wheels of industry turning and they have the ability to send a very small SME to the top - look at Facebook, for example, once a two-man-band headed up by Mark Zuckerberg, now a multi billion company that has produced some of the best innovations in the world.

In 2017, Facebook was recorded to have 25,105 employees across the globe and that will only increase if their profits maintain their steady progression.

With that said, how much profit do the world’s most successful tech companies make per employee?

Research by PostBeyond shows how the tech companies listed in the Fortune 500 compare for profit made per employee.

Highest profit per employee:

1. Facebook - $634,694
2. Apple - $393,097
3. Microsoft - $171,000
4. Alphabet - $158,057
5. Cisco - $131,81
6. Netflix - $109,588
7. Booking holdings - $102,218
8. Adobe - $94,252
9. Oracle - $67,645
10. HP - $51,551

Despite Facebook’s big lawsuit this year in regard to user privacy, they still have a total profit margin of $15,934 million which is a 5.9% increase from the previous year. Although Apple having a total profit of $48,351 million in 2017, their profit per employee averages out at just $393,097 and is down -0.19% since last year.

Microsoft is one of the longest standing tech companies, founded in 1975 by Bill Gates and Paul Allen. However, longest standing doesn’t always mean biggest profit - Microsoft has a total profit of $21,204 million (less than half of Apple’s) and it’s profit per employee stands at $171,000. Despite ranking below Facebook and Apple, it’s percentage change from the previous year is 16.05%.

The companies who have had the biggest percentage growth change from their previous year are NetApp (170.81%), Netflix (125.99%) and Amphenol (109.88%) - all of which combined have a total profit per employee of $169,277 million, just under Microsoft’s profit per employee total.

In regard to the companies which have had a negative percentage change from their previous years, Xerox (-264.42%), eBay (-104.46%) and Motorola Solutions (-89.01%) have been hit the hardest. Data on PostBeyond’s interactive piece here also shows that Dell, eBay and Motorola Solutions are also within the bottom Fortune 500 companies by having the lowest profit: Dell losing $-3,728 million, eBay losing $1,016 million and Motorola Solutions losing $-155 million.

What is the worth of each employee in the industry you work in? Do you think your company is floating or falling?

While the goals of these regulations are often described in detail, they frequently fail to outline just how the requirements must be met or the steps that need to be taken to achieve that compliance. Here Sarah Whipp, CMO and Head of Go to Market Strategy at Callsign, answers the question: Is regulatory ambiguity setting banks up for failure?

Take for example PSD2, which called for open APIs and the application of stronger authentication schemes but didn’t describe how best to meet these needs. With financial institutions in somewhat of a quandary, third party groups have noticed a gap in the market and stepped in to help, such as the Financial Data Exchange (FDX), The Berlin Group and the Open Bank project, who each put forth a different approach to meeting PSD2 compliance.

The three predominant authentication schemes that are currently being used are as follows:

• Redirect – whereby the consumer goes to a third party and when they reach the point where they provide consent, they get redirected to the holder of data, logging in via a page branded by their financial organisation
• Decoupled – when customers provide an approval via a different channel, separate to the one where they are dealing with the third party. For example, a push notification from their banking app if they are enabling access to their bank account
• Embedded – when the third-party processes the customer’s security creds and passes them on to the financial institution. This method won’t work with device-based authentication since underlying organisation won’t have visibility of device being used.

For international banks in particular, this presents a tricky challenge, as they must be able to not only offer each of the aforementioned authentication schemes, but all three of these for each of the third-party groups who’ve stepped in to bridge the gap with PSD2. As a result, these banks are tackling an extremely complex policy situation in which the 9 potential authentication methods are even further compounded depending on location or circumstance. In addition, for each jurisdiction these companies operate in, regulations will be interpreted differently, making a coordinated approach very difficult.

The issue lies not in the sheer number of potential authentication methods with no clear direction from the regulators, but the fact that many of these major, global banks are currently relying on the human policy manager – knowledge siloed to a few IT group team members – to comprehend these regulatory needs. Quite often these teams would have insider knowledge, almost like living and breathing black boxes. Of course, if one of these people leaves the company, they are also taking with them a huge amount of valuable information.

Instead, banks must move away from their home-grown policy managers, and evolve to a more sophisticated and transparent policy manager for which sectors across the organisation can have a say. It is not just the IT team that has to review internal policies at these and say they’re fine. Risk & Compliance right through to the Marketing function needs to ensure they are properly following protocol.

Challenger banks, those who have broken ground in the last decade or so and remain digital-first, are actually positioned much better to deal with these issues as much of their infrastructural practices are already grounded in flexible and agile practices. Thus, many banks facing these problems are established institutions, potentially embracing digital transformation in other areas of the organisation. To ensure they can remain competitive and compliant (regulations aren’t going away, they’re only getting stronger), they must also equip their policies for the future.

If these larger organisations don’t rise to the challenge they are in danger of dramatically harming the customer experience. They need to be able balance keeping their customers’ digital identities safe and as well as comply with regulations, while making sure users can get on without obstacles. By using the latest AI and machine learning, policy managers must adapt and learn in real time to achieve this goal. Implementing this technology, organisations can build multi-factor authentication journeys that are uniquely tailored to their own business, customers, products or services. Financial legislation is constantly being updated, so flexible technology will help them easily navigate any changes with relative ease.