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Platform: The Strongest Foundation for Faster Digital Transformation in Banking

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The last year has brought many changes, including the large and rapid shift towards digital which has also seen banks accelerate their transition to the cloud. This shift has been a good thing, as the cloud has many benefits – from lower total cost of ownership to easier access to innovation that will help banks provide superior customer experiences, not to mention the added bonus of all security and infrastructure management being managed by the cloud provider.

Perhaps most importantly, the cloud prepares banks for the future. Banks based on the cloud can more easily connect to third party platforms through open APIs, enabling them to tap the expertise fintechs and opening up a world of new opportunities. This has never been more important as banks of all sizes compete for the attention of increasingly digitally savvy customers.

How to approach transformation?

Even before the pandemic, banks were already facing fierce, increasing competition from non-bank players such as fintechs, big techs and other third parties. Add to this the acceleration towards digital caused by the pandemic, and we have an environment for banking that necessitates a solid strategy for digital transformation.

One way some large banks are opening the door to the future is by building their own platforms to facilitate Banking-as-a-Service (Baas). This approach sees banks opening up to give third parties access to data via APIs, which enables the development of innovative new products and services that they can also leverage. But the challenge for any bank in building a proprietary platform is made more complex by the need to ensure integration and interoperability with existing legacy systems, while also simultaneously creating a more flexible DevOps based architecture. This is both expensive and time consuming.

Fortunately for banks that want to avoid this level of investment, it is possible to connect to existing third-party platforms such as Finastra’s FusionFabric.cloud. Finastra’s platform for innovation frees banks from the burden of managing and running the platform themselves – allowing them to focus on what really matters: delivering a great banking experience to customers.

FusionFabric.cloud connects banks and fintechs in a way which benefits everyone. Fintechs gain access to a huge market, whilst banks are able to access and deploy innovative apps from fintechs that have been tested and, in many cases, pre-integrated with the core banking systems they are already using. This enables faster implementation, meaning banks can respond to demand and offer reliable new services more quickly.

Thanks that embrace the platform approach and open up to third party collaboration through BaaS also open the door to another exciting business model, embedded banking. Whereas traditional banking involves a customer seeking out a bank to interact with its services, embedded banking involves a non-bank player, such as a ride-sharing operator or online retailer, embedding financial services directly into their customer journey. This means a customer buying a car through an app, for instance, could apply for finance with the app, smoothing out the process by providing the necessary financial service when and where the customer needs it. This area is exciting because it offers the potential for banks to reach new audiences and achieve scale, without the investment normally required to acquire new customers.

The level of competition for customers’ attention has never been higher. Incumbent banks are now having to fend off competition from neobanks, and the industry is seeing more and more non-bank entrants taking market share in specific areas such as payments and lending. It is therefore imperative that banks adopt a platform-based approach to maximise the opportunities available to them.

To explore this topic in more detail Finastra has commissioned research with Aite Group on the Pathways to Competitive Advantage in the Era of Digital Transformation. We will also be sharing the key findings during a panel session, Accelerating through change – technology as a catalyst for open innovation, at Finastra Universe APAC on March 3 – register now to watch the session live at 12pm, or on-demand until April 2.

 

finastra universe

The post Platform: The Strongest Foundation for Faster Digital Transformation in Banking appeared first on Fintech Singapore.

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Source: https://fintechnews.sg/49269/digital-transformation/platform-the-strongest-foundation-for-faster-digital-transformation-in-banking/

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Lakeba ranks in FT’s High Growth Companies for the second year running

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The annual Financial Times Asia-Pacific High Growth Companies ranking places Lakeba as the fastest growing Fintech in Australia.

“Our no-nonsense approach is paying off,” says Lakeba’s CEO, Giuseppe Porcelli.

Lakeba’s growth is driven primarily by its fintech business portfolio, including eziTECH, Verimoto, ezidox, BRICKLET and Quixxi. Whilst it has 12 businesses in its portfolio, its fintech businesses deliver hyper growth. With the Financial Times also recognising Lakeba as part of Australia’s Top Fastest.

Lakeba’s eziTech Banking as a Service technologies are now being utilised by a growing consortium of organisations in the financial services sector, including some of Australia’s most progressive neobanks.

Verimoto provides remote asset and identification verification for vehicle and asset financing. It posted 170 percent YoY growth in March.

Lakeba’s electronic document curation platform, ezidox, saw significant growth. Fuelled by increased broker usage while COVID restrictions eliminated physical document transactions, and deeper integration in one of Australia’s big-5 banks and their key challenger bank. Its CDR accreditation is already fuelling the growth of ezidox’ development as a data rights intermediary.

Quixxi Security’s patented obfuscation technology is used by one of the biggest US insurers, Allstate Insurance Company; Africa’s Standard Bank Group and some of Australia’s most recognised brands. Increased adoption of 5G and eventual 6G technologies in financial services accelerate the need for Quixxi’s technology.

While Lakeba’s property fragmentation service, BRICKLET, remains unchallenged the world over. Currently limiting fragmentation to Australia, it’s portfolio of property fragments is growing in excess of $45 Million.

“We were quite happy to be the biggest fintech you’ve never heard of. But this two-year consecutive ranking by the Financial Times and Nikkei Asia puts pay to that”, smiles Porcelli.

Lakeba‘s doubling down on recruiting senior financial services executive talent, adding to its appointments of Ubank, Judo Bank, eftpos and Citi Bank executive, Alex Twigg; Goldman Sach’s Frank Zhu and Macquarie Bank’s Telly Desillas. Recently hiring Adrian Valinno, BNY Mellon’s former Digital Transformation Lead.

“It’s really important to us to keep attracting the right talent and challenging the ridiculous notion that fintech shareholders need extreme patience in seeing their returns. Our continuing rate of achievement blows that notion out of the water,” concludes Porcelli.

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Source: https://australianfintech.com.au/lakeba-ranks-in-fts-high-growth-companies-for-the-second-year-running/

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Praemium FUA up, opens Edinburgh office

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The platform has recorded increased funds under administration (FUA) of $37.9 billion as it expands its presence in the UK with the opening of an office in Edinburgh, Scotland.

For the March quarter, Praemium recorded an 11% increase in FUA, and a 96% increase compared to March 2020.

The Australian platform FUA increased 224% on the previous corresponding period to $16.9 billion while the international platform increased 42% to $4.4 billion.

The platform recorded $801 million in net platform inflows with $448 in the Australian platform for the quarter, up 149% on the previous corresponding period.

Praemium has doubled in size over the past year. Despite the pandemic, the past 12 months have been the most transformational in our story thus far,” Praemium chief executive Michael Ohanessian said.

The results follow the opening of a Praemium office in Edinburgh.

To read more, please click on the link below…

Source: Praemium FUA up, opens Edinburgh office | Financial Standard

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Source: https://australianfintech.com.au/praemium-fua-up-opens-edinburgh-office/

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Mambu research reveals global consumers are hesitant to use Open Banking

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A study of 2,000 global consumers released by Mambu, the market-leading banking and financial services platform, revealed that a significant misunderstanding of open banking is hampering its adoption. The Censuswide survey, commissioned by Mambu, found that more than half (52%) of respondents have never heard of open banking and 61% have never used it, in spite of 80% of respondents using one or more mobile finance apps.

“The research reveals the majority of customers don’t understand what open banking is, how it works and what it means for them”, said Elliott Limb, Mambu’s Chief Customer Officer. “But it also reveals they do care about receiving better financial services that support their lifestyles – smart banking. If banks address this need and lack of understanding, it will help banks build customer loyalty and provide genuinely innovative, differentiating, revenue-generating services.”

Kristofer Rogers, General Manager ANZ for Mambu, added, “In Australia, one of the main reasons for the slow adoption of open banking so far is that open banking is built on modern technology, and the Australian banking and financial services industry is not. There’s a huge disconnect, with many established banks simply unable to deliver on the regulatory requirements of open banking with their existing technology – they need to adopt API-first, cloud banking tech to truly embrace open banking. And it’s imperative that we do make progress on this because beyond technology, open banking is ultimately an ideology of creating better financial outcomes for every Australian, and who doesn’t want that.”

Open banking sees increase post-COVID despite consumers being ‘scared’ to use it

Open banking has witnessed an increase in adoption globally as a result of the COVID-19 pandemic, and the research indicates a marked change in attitude and priorities as a result of the crisis. According to our survey, 52% said they wanted more control over their finances. At the same time, 40% said the pandemic had changed their attitudes to privacy and 24% to data sharing. Another boost came from the 41% who said they have had more time for research.

  • I have needed to take more control of my finances (52%)
  • I have had the time to do my own research and understand it better (41%)
  • My attitude to privacy has changed since the pandemic (40%)
  • I’m less worried about sharing data (24%)
  • I have had more time to set it up (40%)

However, existing concerns remain with 48% of consumers claiming they are ‘scared’ to use open banking and 53% still believing that open banking is a dangerous use of data sharing.

“Banks must accept that open banking is still a not fully comprehended phenomenon so this is the starting point,” said Dmitrii Barbasura, CEO and Co-Founder, Salt Edge, a Mambu partner. “We believe they need to invest time and effort in educating customers about the new possibilities they get access to, and also inform them about their rights and the high safety level covered by open banking.”

Change the Record

Demonstrating the opportunity for open banking, the survey revealed that 57% said they would be more likely to use it if their bank had more successfully implemented and promoted it.

When exploring further what consumers want from open banking, the survey shows that nearly half of respondents want instant digital money transfers; more than a third want aggregated bank balances at a glance; a third want tips on better money management and a quarter want money-saving suggestions for their bills.

  • Instantly transfer money between different accounts (48%)
  • See different account balances together at a glance (38%)
  • Help boost my savings automatically calculating spending patterns and moving spare money into savings or investments (36%)
  • Receive helpful hints about better money management (34%)
  • Receive one overall monthly bank statement (34%)
  • Allow access to banking data to receive automatic suggestions about money saving on bills and insurance (26%)

This is the first study of Mambu’s newly launched research series, Disruption Diaries. The series seeks to understand what customers think of the key trends driving the development of the financial services industry, in an effort to identify opportunities for banks and others. The full report on open banking can be found here: Let’s talk openly.

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Source: https://australianfintech.com.au/mambu-research-reveals-global-consumers-are-hesitant-to-use-open-banking/

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Zip Co raises $400 million for international expansion

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Zip Co (ASX: Z1P) has priced $400 million of senior convertible notes to fund expansion into new regions on the back of major growth in the US.

Co-founder and COO Peter Gray says the move will keep shareholders happy, with the notes set to mature in 2028.

“We are very pleased with the strong global demand for this offering,” says Gray.

“This transaction further diversifies Zip’s sources of capital and allows us to pursue our global growth aspirations while reducing potential dilution of existing shareholders. Another fantastic outcome for Zip and its shareholders.”

The $400 million in convertible notes mirrors the approach recently taken by buy-now pay-later (BNPL) competitor Afterpay (ASX: APT).

However, Zip’s latest raise doesn’t come close to the whopping $1.5 billion secured by Afterpay’s settlement of convertible notes due in 2026.

The offering is being marketed to eligible investors and the notes are set to be listed on the official list of the Singapore Securities Trading exchange. Settlement is expected on or about 23 April 2021.

To read more, please click on the link below…

Source: Zip Co raises $400 million for international expansion

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Source: https://australianfintech.com.au/zip-co-raises-400-million-for-international-expansion/

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