The New Normal in Payments is Digital-thumb

The New Normal in Payments is Digital

The COVID-19 has prompted several countries to implement various modes of lockdown measures to contain its spread. Safe distancing has become the new norm and work from home has become the default option for many companies and organisations looking to strike a delicate balance between safety and productivity. As a result, it accelerated the adoption of digital payments across many industries.

The fact that using cash or physical bank notes could potentially help the spread of COVID-19 is just one of the factors. While there is no definitive conclusion on this matter yet, many government leaders are taking a cautious approach and are limiting the circulation of cash or bank notes in their system. For example, South Korea, China and the US Federal Reserve have implemented a process to disinfect their banknotes. In fact, “all Chinese banks must now literally launder their cash, disinfecting it with ultraviolet light and high temperatures, then storing it for seven to 14 days before releasing it to customers,” says CNN in its report.

Could these actions be considered extreme precautionary measures? Perhaps. But one thing is clear: such interventions on the supply and circulation of bank notes will directly impact cash payments, further opening the floodgates for further adoption of digital payments.

Safe distancing has become the new norm and work from home has become the default option for many companies and organisations. As a result, it accelerated the adoption of digital payments across many industries.

Digitally ready banks are poised to emerge stronger

As the situation stabilises, and some sense of normalcy start to kick in, banks that are digitally ready are poised to benefit greatly. Investments that help bolster digital payments infrastructure, open banking, artificial intelligence, and data analytics will prove to be wise decisions. In fact, some of the initiatives that have started even before the current pandemic hits now provide considerable value to the customers and entities they aim to serve. Some of them are:

UnionBank’s Financial Supply Chain on Blockchain

In an age where exchanges of goods and services has never been more closely connected, Financial Supply Chain has never been so crucial. Financial Supply Chain on Blockchain enables transparency while protecting sensitive data and information through distributed ledgers and smart contracts. This enables UnionBank to offer non-traditional payment options to Small and Medium Enterprises, Distributors, Suppliers and Dealers while digitizing the invoice presentment and demand order processing.

The development (in partnership with IBM) of the Financial Supply Chain System on Blockchain gives the Distributors, Dealers and Suppliers that are enrolled in the system the confidence to avail non-traditional financing options on a single click of a button. This provides efficiency in managing their receivables and payables as manual processing takes too much time.

NETS’ Click

NETS Click enables the digitisation of NETS Bank Cards on third party merchant mobile applications for secure seamless payments. The product was conceived and built in-house with a lean project team comprising cross-functional domain experts from product, technology, security and compliance teams. The design is aligned to concepts of EMVCo’s Secure Remote Commerce (SRC) and fulfils equally stringent industry security requirements.

NETS Click features a highly advanced security design incorporating multi-layered mobile digital security, EMV-based tokenisation technology, bank card and consumer verification methods. Most importantly, it was developed with a human-centred product design. The result is a simple and friendly user journey incorporating advanced mobile runtime threat detection coupled with host-based AI-driven fraud and security monitoring.

TMRW by UOB’s Intelligent Assistant

TMRW’s distinct service delivery model brings together a complex orchestration of chatbot, live chat, and VOIP voice call similar to some of the leading messaging platforms – creating an experience unmatched by any typical bank. TMRW’s chatbot Tia (TMRW Intelligent Assistant) is right at the center of this experience.

The chatbot orchestration is the first digital service model that uses chatbot to orchestrate the delivery of customer service as a combination of self service, FAQ responses and human support through voice or chat – all without the user having to ever exit or switch away from the TMRW app.

The New Normal is Digital

It is still early to conclude what’s the landscape will look like once the dust fully settles. As it is, the battle against the current pandemic is still ongoing. From a purely financial context, we can clearly see the signs towards increased digitisation of payments. How big and how fast it will grow still remains to be seen.

We can only hope that the present crisis could be eliminated soon. As the world continues to rely on technology to solve many of today’s ills, our habits, patterns and way of living never ceases to evolve. One thing is for sure: the COVID-19 is forcing upon us a new normal – a new normal that thrives on increased digitisation.

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>> To read more about this story and other exclusive features about the digital banking landscape, download the latest issue of The Digital Banker Magazine HERE.

Digital payments surge amid safe distancing measures

Digital payments surge amid safe distancing measures

The coronavirus has totally upended the supply and demand markets. The urgent need for essential products coupled with the fact that governments and regulatory bodies are now discouraging the use of cash, has prompted a swift rise in digital payments. Convenience and security aside, digital payment is now the de facto mode of payment as many e-commerce sites are tightly intertwined with e-payment solutions that make the whole system work.

It is no coincidence that the daily downloads of online grocery delivery apps such as Instacart, Walmart Grocery and Shipt have surged by 218%, 160% and 124%, respectively.

People who are at home for long periods of time need to buy groceries and household essentials more frequently – and they prefer online shopping. Regardless of the level of lockdown being imposed, people tend to avoid visiting brick-and-mortar stores. Shops are taking notice and are rapidly ramping up their online presence as well. Stores that have already started implementing e-commerce solutions are rapidly building scale and capacity to be able to cater to stronger demands.

It is no coincidence that the daily downloads of online grocery delivery apps such as Instacart, Walmart Grocery and Shipt have surged by 218%, 160% and 124%, respectively.

As more consumers continue to stock food and other essentials, the volume of online transactions and digital payments will surge precipitously. In fact, it was revealed that COVID-19 has massively accelerated e-commerce growth to the tune of 77% year-on-year, with a total online spending hitting $82.5 billion in May, according to Adobe report.

“We are seeing signs that online purchasing trends formed during the pandemic may see permanent adoption,” Taylor Schreiner, Director, Adobe Digital Insights, said in a statement.

The future of payments is digital

This observation is consistent with what is happening on the ground. In Singapore, local banks such as OCBC, UOB and DBS are reporting that a significant number of customers have switched to digital banking due to COVID-19.

DBS Bank, Singapore’s biggest bank, noted that more than 100 million digital banking transactions happened this year, compared to the same period in 2019. In addition, digital payments have more than doubled and e-commerce transactions rose by as much as close to 40% in value. It’s interesting to note that there are around 3.3 million Singapore users banking online with DBS and about a quarter of whom are seniors – an indication that the adoption of digital banking cuts across various sectors and demographics in Singapore.

Meanwhile, in China, where digital payments are already in its maturity, COVID-19 may well push the country for the total elimination of cash transactions. In 2008, only 18% of Chinese internet users made online payments. This figure jumped to almost 73% in 2018, which is partly attributed to young people being open to the use of new technologies, according to a recent survey by Deutsche Bank.

Comparatively, China and many Southeast Asian nations have a larger proportion of young populations than Europe and the US. In places such as Japan, Western Europe and the United States, a third of the population still consider cash as a favourite payment method, according to the same survey.

“While we believe cash will stay, the coming decade will see digital payments grow at light speed, leading to the extinction of the plastic card.”

Deutsche Bank’s report, The Future of Payments, neatly summed up where the world is headed when it comes to digital payments: “While we believe cash will stay, the coming decade will see digital payments grow at light speed, leading to the extinction of the plastic card. Over the next five years, we expect mobile payments to comprise two-fifths of in-store purchases in the US, quadruple the current level. Similar growth is expected in other developed countries, however, different countries will see different levels of shrinkage in cash and plastic cards. In emerging markets, the effect could arrive even sooner. Many customers in these countries are transitioning directly from cash to mobile payments without ever owning a plastic card.”

What’s interesting is that even though a significant portion of the population in Western countries still prefer to pay with cash, their preparedness when it comes to digital payments could never be questioned. In the US, digital payments champions such as Paypal, Apple Pay and Google Pay are consistently thriving.

European countries, through its Central banks such as the the Bank of England, the European Central Bank, the Sveriges Riksbank and the Swiss National Bank, together with the Bank for International Settlements (BIS) have initiated assessment of potential cases for central bank digital currencies. These would perform all functions of ‘cash’ and aims to be used by individuals and businesses to make both payments and savings. The task ahead can be daunting and will require enormous effort and commitments from both the governments and private sector organisations involved.

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>> To read more about this story and other exclusive features about the digital banking landscape, download the latest issue of The Digital Banker Magazine HERE.

3 Factors That Will Accelerate the Cashless Revolution

3 Factors That Will Accelerate the Cashless Revolution

The COVID-19 pandemic has spared practically no one. In all corners of the world, with people from all walks of life, everyone is talking about a new normal, barely less than a year after the crisis starts. One of the most hotly debated topics of late is whether we are now heading towards a fully cashless society. Will 2020 mark the start of a process when we completely banish cash as a medium of value exchange?

Since about 960 AD, when the earliest known paper money began circulating in China, the thought of eliminating cash, in favour of electronic or digital medium, had been inconceivable. Ironically, these days, China is one of the leading countries with the highest volume of cashless transactions. From food to clothing to the latest gadgets and games, people, regardless of age or social status, are using some form of digital medium to pay for goods and services in China.

China is truly a trailblazer in the “cashless” movement. According to figures from eMarketer, “mobile payment users in China will represent 61% of the 947.1 million proximity mobile payment users worldwide.” Furthermore, 577.4 million people in China made a purchase via proximity mobile payment within a six-month period in 2019. “Those users account for 49.6% of the country’s population,” says eMarketer.

This astounding growth is enabled by leading Chinese fintech firms, Alibaba (Alipay) and Tencent (WeChat Pay). Reports from Forbes revealed that “Alibaba’s revenue grew 144% over 2017-2019 to $56 billion.” Meanwhile, Tencent reported a total annual revenue of nearly 377 billion yuan in 2019, an increase by 20 percent compared to the previous year,” according to figures from Statista. Surely, the rate of growth of these companies is reflective of the Chinese population’s fondness for digital medium.

This cashless revolution is no doubt going to be further accelerated by the COVID-19 pandemic. In fact, many fintech firms and online payment platforms such as PayPal, Venmo, Stripe and Square have never been busier these days.

This cashless revolution is no doubt going to be further accelerated by the COVID-19 pandemic. In fact, many fintech firms and online payment platforms such as PayPal, Venmo, Stripe and Square have never been busier these days. Merchants are now scrambling to provide digital payment options to customers who seek to avoid, or are simply unable to, pay cash. “Our products have never been more wanted and needed,” said PayPal CEO Dan Schulman in light of the report that PayPal is signing up around 250,000 customers a day with 7.4 million customers activated during April period.

PayPal added that it was growing across all markets including those most impacted by the coronavirus pandemic such as Spain and Italy.

Factors that will affect drive towards cashless society

While all signs point to an inevitable shift to a cashless society, there are real and significant issues that must be addressed first before we declare the death of cash. Some of these are:

Technology

Turning the dream of a cash-free society depends largely on technological readiness. It can be argued that China’s success in the widespread use of digital payment medium is underpinned by its success in setting up an infrastructure that allows collection and processing of enormous amounts of data. In addition, China has also invested significant amount of resources to develop e-RMB, the first digital currency operated by a major economy. Through and through, technology has played a central role in mounting these efforts.

Similarly, in Sweden, a group of six large Swedish banks have joined together to develop Swish, a mobile payment system that boasts of more than 6.5 million users as of 2018. Today, Swish is used by almost all merchants in Sweden as the de facto payment option along with payment by card. Payment by cash, in fact, will earn you some frown as almost very merchant prefers card or payment by Swish mobile app.

In the US, the charge is being led by unicorn fintech companies that have found a way to embed their technology into the lives of online customers locally and abroad. Famous global brands such as Under Armor, Target, Lyft, Grab, Deliveroo, Facebook, Google and Uber, for example, are all using Stripe, an online payments processor for internet businesses.

Turning the dream of a cash-free society depends largely on technological readiness. It can be argued that China’s success in the widespread use of digital payment medium is underpinned by its success in setting up an infrastructure that allows collection and processing of enormous amounts of data.

Culture

For a cashless society to truly thrive, there must be a widespread shift in cultural norms. Whereas some societies have generally been more open with new technology and innovation, some communities are averse to digital technology because due to the inherent security risks involved. Moreover, the digital divide between the highly industrialised and developing nations couldn’t be denied. As such, customs and beliefs among the population on what constitutes ‘value transfer’ may be hard to shift.

Government

Governments, and people’s trust in them, play a crucial role in pushing the agenda of a cashless society. A purely digital value exchange requires management and security of enormous amount of data. Hence, the population must be able to see that the ultimate custodian of their financial transactions, are trustworthy and capable. Perhaps it would be good to start building momentum by capitalising on familiar government-led initiatives such as smart-nation. By touting the benefits of smart-nation, an argument for a digital value exchange on a national level can be made.

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>> To read more about this story and other exclusive features about the digital banking landscape, download the latest issue of The Digital Banker Magazine HERE.

The Highs and Lows of AI in Banking 1

The Highs and Lows of Artificial Intelligence (AI) in Banking

The Age of AI is finally upon us. Arguably the single biggest technology revolution of the 21st century, artificial intelligence (AI) is now coming to full maturity with many companies and organisations racing fast to harness its full potential. And the financial industry is currently leading the charge.

This technology, which enables machines to provide human-like intelligence on a quantum level in order to augment human intelligence and decision making, is now being used to cut costs, improve compliance, increase revenue and improve customer experience.

Its business value is so huge that anyone who fails to put a solid strategy behind it is expected to be edged out by competition. In fact, the business value that could be gained through the use of artificial intelligence in the banking industry is forecasted to grow significantly in the next 10 years.

According to industry forecasts, by the year 2030, the use of AI in the banking industry will generate around 99 billion U.S. dollars in value in the Asia Pacific region alone.

 

Fig. 1: Business value derived from artificial intelligence (AI) in banking industry worldwide
2018 to 2030, by region

 

 

Business value derived from artificial intelligence (AI) in banking industry worldwide 2018 to 2030, by region

Source: Statista

AI is set to have a truly positive impact to people – but it won’t come without its own set of challenges. As of late, we see many banking organisations launching their respective AI initiatives in order to be more efficient. By implementing intelligent automation, manual repetitive tasks are being reduced, interactions with customers are being improved, and sustainability initiatives are getting further along. The key challenge has always been the know-how, and to a certain degree, people’s biases around AI, mainly due to lack of understanding and wrong impressions propagated through media and other forums.

AI is set to have a truly positive impact to people – but it won’t come without its own set of challenges.

AI in 2020

Whether we like it or not, AI is here and will continue to impact people’s lives. It will bring new opportunities for businesses and the workforce alike. It will create new experiences for customers that are more aligned with their expectations. Some of the notable trends we see in 2020 are:

Open source frameworks will grow

Thanks to open source software, the barrier to entry in AI is lower than ever before. Nowadays, there are a number of open-source tools to choose from, including Keras, Microsoft Cognitive Toolkit, and Apache MXNet. Before these, Google has already warmed the market with it released its TensorFlow machine learning library as an open source back in 2015.

Predictive maintenance algorithms will gain traction

Cost pressures will continue to drive many companies to find ways to save millions of dollars in unexpected failures. As such, predictive maintenance algorithms, which constantly collect data to predict equipment failures before they occur, will gain traction. With continued drop of sensor costs and increasing availability of required skillsets, investments in this area will grow dramatically.

Auto claims processing and settlement will improve

In the past, humans manually analyse accident images and review driver behaviour based on available documentary record. This will change. With many insurers and fintech companies now using AI to compute a car owner’s “risk score”, expect the whole system to be overhauled resulting to faster claims processing and better customer experience.

Language translation will become more responsive to business needs

Natural language processing for the purpose of language translation accurate enough to respond to business needs has always been a challenge. Thanks to companies such as Google and Baidu, this might be a thing of the past. With much resources being poured into improving translation frameworks, expect great improvements in language capabilities, allowing wider adoption across industries.

Proactive cyber threat monitoring

The financial industry has been rocked with multiple cases of breach in cybersecurity. It resulted to an immeasurable amount of loss in revenue, not to mention the trust and confidence of many customers in these institutions. With advancements in computing power, proactive hunting of threats using machine learning is now possible and will continue to grow as more businesses realise its intrinsic value.

Proactive hunting of threats using machine learning is now possible and will continue to grow as more businesses realise its intrinsic value.

The China Factor

By now, China’s ambition to lead the world in the area of artificial intelligence is no longer a secret. It is determined to outpace not only the US but every global economy in AI. According to Kai-Fu Lee, a known AI expert and a Taiwanese-born American computer scientist, businessman, and author, China is now producing more than 10x more data than the US. By all indications, China looks set to catch up to the US by 2025 and lead the world by 2030 in terms of technical capabilities, available talent and most of all, data.

Most of these capabilities are coming together, thanks to China’s big tech companies who are bringing their AI capabilities to the global marketplace – Baidu, Alibaba and Tencent (collectively called BAT).

These three Chinese big tech companies combined are positioning themselves to be the AI platform of the future, giving its American counterpart, GAFA (Google, Amazon, Facebook and Apple) a run for its money.

The Highs and Lows of AI in Banking 2

With its breadth of resources, Baidu, Alibaba and Tencent are now able to compete with US tech giants for global AI talent. Reports reveal that “Baidu USA was offering a base salary of $130K to $175K per annum for a machine learning engineer…according to a petition filed with the US labor department for non-immigrant workers. (For comparison, Google was offering around $110K for an ML engineer, although experience levels and job requirements likely vary.)”

In addition, many of the BAT’s AI products are competing directly with what GAFA are working on such as smart speakers, AI in e-commerce, autonomous vehicles and more.

But what’s interesting to note is that Baidu, Alibaba and Tencent has strong support from the Chinese government. According to CBInsights, “China wants to be a world leader in AI in the next decade, and BAT is crucial to helping it get there.”

The Chinese science ministry announced that “the nation’s first wave of open AI platforms will rely heavily on Baidu for autonomous driving, Tencent for AI in healthcare, and Alibaba for smart cities. Government support for and intervention in AI development will likely have an immediate impact on the fast-growing Chinese tech market (where an entire city is being built from scratch around AI-centric solutions),” the report said.

While Baidu, Alibaba and Tencent are operating on a much bigger scale, the number of AI startups  and corporations making headways in various sectors continue to climb. Recent figures reveal that the number of AI corporations in Beijing amounted to 422 while the number for Shenzhen totalled 167 as of May 2019.

In addition, there are a number of well-funded Chinese AI startups 2019. As of June 2019, SenseTime received total funding amounting to around 2.64 billion U.S. dollars, holding the top rank as the most funded artificial intelligence (AI) startup in China. Among the top five most funded AI startups were Megvii, UBTech Robotics, AIWAYS, and Horizon Robotics.

Across many industries, China, and by extension, Chinese AI companies, are emerging as a formidable force in artificial intelligence globally.

By all indications, China looks set to catch up to the US by 2025 and lead the world by 2030 in terms of technical capabilities, available talent and most of all, data.

How Banks Can Win Through AI

Every bank, in some shape or form, has been impacted by AI. Be it back, middle or front office, nothing has been left untouched. It’s probably common for many banking customers to have interacted with a customer service chatbot but what may not be as apparent is that many financial institutions have probably used complex machine learning to detect money launderers or sifted through mountains of data to ward off fraud and other anomalies before they wreak havoc, which is much more difficult to control.

Here are the areas where banks can win big today through AI.

Customer Experience and Front Office Support

Client’s customer support expectations are always evolving. While many Millennials will not visit a brick and mortar bank branch for anything, their expectations of its digital representative is a different story. Artificial intelligence has brought on a lot of these changes. With AI-enabled chatbots and voice assistants, information sought by customers can now be dispensed faster, cheaper and more accurately. We’re also seeing AI helping biometric authorisation as well as ‘physical’ help for those who fancy an occasional bank branch visit through an AI-enabled robotic assistant.

AML and KYC Compliance

AI can help detect fraud, identify patterns and “find the needle in the haystack”, in a manner of speaking. It can help in: transaction monitoring (identify non-obvious connections between individual transaction chains); entity resolution (creates a single unified view of a customer across local and international databases); identifying ultimate ownership (extract information to identify who has ownership or management stake); and media monitoring (categorise news articles and generate a match relevance score).

Risk Management and Lending

AI has the capability to objectively assess information and come up with equitable credit underwriting. By achieving a credible credit scoring and lending efficiently, AI can help banks assess and manage risks and how they build and interpret contracts. This is good news as there is a tremendous upside in this proposition in terms of new business opportunities and promoting people to do higher value work engagements.

Outstanding Machine Learning Initiatives

As they say, it is not a matter of if, but a matter of when and how. Many notable banking institutions are now in the thick of implementing machine learning initiatives as part of their overall artificial intelligence strategies. From stories about automation and how it would augment human capabilities, to fintech collaborations, to how banks are now using machine learning to provide frictionless, 24/7 customer interactions, there are plenty of case studies to learn from.

Taipei Fubon Bank

Taipei Fubon Bank has 4.11 million regular account holders and around 390,000 wealth management customers. Every year, some 1% of regular deposit customers get “promoted” to wealth management status through various methods and gain access to the services afforded to wealth management customers. To come up with a more efficient and scientific method to identify the potential value of customers and boost their activity with the bank (leading to higher status), Taipei Fubon Bank resorted to machine learning technology to predict customer value.

Because the value of customers has been underestimated, many customers were not cultivated by the wealth management team and only had access to the services and experiences made available to regular account holders, focused primarily on online services such as online banking and mobile banking. They did not receive personalised wealth management services or investment recommendations.

After the value of customers was identified more accurately, the customers who were promoted to wealth management status received priority treatment in offline (branches) and online channels. Offline, they were offered exclusive financial planning services supported by dedicated financial consultants, received invitations to VIP events, and receive gifts when visiting a branch. Online, they were sent regular newsletters with the latest investing, product and market information. They also received personalised product recommendations, wealth management perks and special offers. These multitude of online and offline activities and benefits forged a powerful omnichannel VIP experience for customers.

Taishin Bank

When it comes to enhancing customer engagement, relying only on traditional, structured customer data, from demographics to transaction history, has its limits. Unstructured conversation data from call centers reveal opportunistic life transitions, such as starting a family and buying a house are defining moments of the human experience, that would complete the whole personalised customer journey.

Beginning as a cross-business-unit collaboration, Taishin Bank developed and applied speech-to-text and text-mining technologies across business units – from call center to business intelligence development, digital banking, payment services, and information technology. They leveraged speech-to-text and text-mining technologies to create a hybrid data source, composed of static and dynamic, structured and unstructured data. Collectively, the bank increased work efficiency at the customer call center through the automation of call type labeling. They’ve also enhanced customer experience of Taishin’s web and mobile applications by resolving trending issues in customer calls. Furthermore, the monetisation of hybrid data is increasing due to its life storytelling marketing strategies by proactively reaching out to each customer at the point of their life transitions.

Bank of Ayudhya Public Company Limited (Krungsri Bank)

“Analytics-Based Decision Platform” is an initiative of Krungsri Bank that brings in the most efficient approach for providing the best recommendation tailored for each Krungsri customer. Leveraging on machine learning algorithm, the platform produces smart prediction and consistent recommendation for interacting with each individual customer across all touchpoints. With the efficiency of this data-driven platform, Krungsri has developed a positive customer experience that ultimately wins the customers’ long-term engagement.

As behaviours and lifestyles of each customer will change over time, they need a bank that is capable of learning and adapting to their needs. This platform was built to continuously learn from all customers and produce insights required to meet and go beyond customers’ expectations.

Image: Sean Xu / Shutterstock.com

>> To read more about this story and other exclusive features about the digital banking landscape, download the latest issue of The Digital Banker Magazine HERE.

10 Most Promising FinTech Startups Worth Over $1B

10 Most Promising FinTech Startups Worth Over $1B

Not so long ago, the distinction between a financial services company and a technology company is clear and well-defined. Nowadays, the lines between the two are so blurred to the point that many of each other’s services overlap – thankfully, to the benefit of the customers. It is so common for many technology companies nowadays to apply for financial services license, while traditional financial services organisations now call themselves tech innovator.

Fintech, or financial technology, is at the core of this transformation. As key players from both industries try to outcompete each other in terms of maximising operational efficiency, lowering costs and improving customer experience, there will be inevitable winners are losers. Only time will tell which companies will emerge on top but for now, these are the 10 most promising fintech startups to watch in 2020.

It is so common for many technology companies nowadays to apply for financial services license, while traditional financial services organisations now call themselves tech innovator.

1. Plaid

Plaid serves as a mediator between finance/payment apps and customer bank accounts. Plaid allows easy fund tracking and transfers. And it has a major appeal, where it doubled its customer count in 2019. The company has since expanded to Europe, where it now operates in Ireland, France, Spain, and the UK! Its excellent performance made it an acquisition target by Visa. In addition, it has appeared 5 times in the Forbes’ Fintech 50 list!

Current market value is $5.3 billion.

2. Stripe

Stripe provides an economic infrastructure that ensures safe and secure payment and online business management for businesses of all sizes. Right from its inception in 2010, the aim of its founders, Patrick and John Collison, was to provide payment solutions for SMEs and help them grow their business, using a secure billing system that could detect and protect them from fraudulent activities on the internet. With Stripe, merchants can connect to buyers, create complex billing systems, use SQL-powered analytics, create and distribute cards, and also perform other financial management functions necessary for by their business. Stripe provides these services so seamlessly, that tech giants Microsoft and Amazon, including 1000,000 other companies rely on their services.

Current market value is $35.5 billion.

3. Monzo

Ever since its UK banking license restriction was lifted in 2017, Monzo has gained more popularity and acceptance.  The company’s statistics claim that one in every twenty adults in the United Kingdom uses Monzo online banking platform. Monzo became a billion dollars company in 2018 after its fundraising campaign got £85mn from US venture capital investors. As of October 2019, the digital-only bank had over 140,000 customers. With an estimated 55,000 new signups every week, the number is bound to keep increasing. Monzo is committed to helping people make smarter decisions with their money. Hence, it already has a feature that prevents users from spending their funds on gambling, and the company aims to extend the same blocking functionality to the purchase of junk food.

Current market value is $2.5 billion.

4. Coinbase

Coinbase is one of the largest crypto-currency exchange services in the world. Headquartered in San Francisco, California, Coinbase is a secure platform that makes it easy to buy, sell, and store cryptocurrency like Bitcoin, Bitcoin Cash, Ethereum, Ethereum Classic, Litecoin, Tezos, and many others. It brands itself as a regulation-compliant company offering security and convenience. In addition, the company offers auxiliary services such as personal electronic wallets, and new currencies to those seeking added privacy.

Current market value is $8.1 billion.

5. TransferWise

TransferWise was established with the main aim of cutting the outrageous bank charges people pay to transfer money abroad. It was established in 2010 by Kristo Käärmann and Taavet Hinrikus, who were fed up with the bank charges they had to pay to transfer funds between the UK and Estonia. With over six million customers using their service, TransferWise distributes up to 4 billion dollars every month across 750 currencies. It charges a decent transfer rate, which is lower than the typical bank rate.

Current market value is $3 billion.

6. NuBank

Nubank was created to provide efficient, fair, and transparent banking services for Brazilians, who are tired of the traditional banking system, which charges them exorbitant fees and high-interest rates despite being poor at service delivery. Nubank offers free digital accounts with no maintenance charges, credit card services, personal loans, and world-class customer service. It was established by David Valez, Cristiana Junqurai, and Edward Wible in 2013. Its operations kickstarted in 2014, and as of 2018. Nubank became the third Brazilian bank to hit the one billion dollar mark.

Current market value is $10 billion.

7. Ripple

Ripple enables banks, payment providers, digital asset exchanges and companies to send money globally using advanced blockchain technology. It provides real-time gross settlement system, currency exchange and remittance. It facilitates international payments for 300 institutional clients including Santander and Standard Chartered. In 2019, it sold over $500 million worth of XRP, allowing the company to expand and invest in MoneyGram too!

Current market value is $10 billion.

8. Robinhood

Robinhood is a commission-free investment portal that provides users with investment opportunities in the US stock market, options, ETFs, and ADRs. It was established in 2013 by Vladimir Tenev and Baiju Bhatt. Robinhood has so far registered about 6 million users who enjoy a range of other banking services, including savings and checking accounts, debits, and also the purchase of cryptocurrencies. All these are done through the Robinhood App or website without requiring any foreign exchange fees or account minimums.

Current market value is $7.6 billion.

9. Lemonade

Lemonade is a leading casualty and property insurance company that was built on a unique model of charging a flat rate and paying claims and premium within minutes, unlike what’s obtainable in the traditional insurance industry. Lemonade uses a highly sensitive artificial intelligence bot, Maya, and chat messengers, via which clients can receive quotes, advice, and insure their assets within minutes. Lemonade believes in giving back to the society; hence, a considerable part of the leftover money in the users’ insurance pool goes to charity.

Current market value is $2 billion.

10. Klarna

Klarna is a Sweden-based online banking platform that provides payment solutions to different online stores. It eliminates payment hassles for online shoppers by allowing them to pay for their purchases after 30 days, or in instalments for three months. Klarna grew to become the biggest fintech company in Europe in August 2019, after it received a 460-million-dollar funding, which raised its financial strength to 5.5 billion dollars. It partners with reputable vendors like ASOS and over 1,500 other retailers. It has 80 million active users in 250 countries, and with 50,000 new customers every week, Klarna is on the path for even bigger growth.

Current market value is $5.5 billion.

>> To read more about this story and other exclusive features about the digital banking landscape, download the latest issue of The Digital Banker Magazine HERE.

DBS Bank The world’s best bank just raised the ante on customer experience

DBS Bank: The world’s best bank just raised the ante on customer experience

Judging by its initiatives over the past year, DBS Bank doesn’t rest on its laurels when it comes to delivering simple and seamless digital banking experience for its customers. As the first bank in the world to simultaneously hold four of the most prestigious global best bank honours at the same time, including one given by The Digital Banker in 2019, DBS has proven once again that it’s at the top of its game. Bagging 9 major awards at the Digital CX Awards 2020 by The Digital Banker, there is no doubt that DBS is the banking leader in customer experience. The awards include:

  • Winner, Best Bank for Customer Experience
  • Winner, Best Product or Service Innovation
  • Winner, Excellence in Omni-Channel Customer Experience
  • Winner, Best Employee Experience
  • Highly Acclaimed, Best Digital Bank for Customer Experience
  • Highly Acclaimed, Best Digital Customer Experience in SME Banking
  • Highly Acclaimed, Outstanding Chatbot Customer Experience
  • Highly Acclaimed, Best User Experience – Internet
  • Highly Acclaimed, Best Digital Customer Experience Overall

Emerging on top among the more than 200 nominations in various awards categories received this year, DBS Bank’s achievements are the envy of its peers. Among the highly respected line up of judges who helped select this year’s award winners are elite industry professionals from companies such as Forrester, EY, Fuji Xerox, Bain & Company, Wipro Digital and KPMG.

“At DBS, we believe our people anchor everything we do, and if we get our people agenda right, that forms the best foundation for a successful business. Being recognised as the best in the industry not only in customer experience but employee experience as well, gives us great pride and honour. Most especially, our fulfilment comes from the fact that we have designed employee experience programmes and campaigns with a strong focus on building a future-ready workforce, ensuring employees feel connected and making employees feel valued,” said Karen Lee, Executive Director, Technology & Operations at DBS Bank.

“At DBS, we believe our people anchor everything we do, and if we get our people agenda right, that forms the best foundation for a successful business.”

Improving usability of digital banking platforms

DBS’ digital innovations are conceptualised with reference to the hierarchy of the customer digital needs pyramid. The pyramid is three-tiered, with stability forming the most essential basic requirement for mobile banking services, followed by functionality and usability. The bank has always grounded its digital proposition with stable and reliable systems. Demonstrating that it is at the forefront of digital banking, DBS was also one of the first to adopt digital security tokens and transaction signing pins as multi-factor authentication methods. To ensure that its mobile banking functions exceed its customers’ expectations, DBS conceptualized a digital landscape that offers an extensive list of channels, services and a simplified UI.

dbs digibank

With the launch of the revamped digibank mobile app, customer feedback has revealed an overall positive response and receptiveness towards its usability. Many customers have pointed out that they appreciate the novel features and aesthetic upgrades which have enhanced their overall experience, leading to improved monthly customer satisfaction scores.

As a boost to its mobile-first strategy, just recently, the bank has observed a new record in which the total financial transaction value on mobile banking has exceeded Internet banking. Internet banking has always been ahead in terms of financial transaction value because customers have the impression that internet banking is more secure. Mobile banking, the younger brother of Internet banking, has been associated with low risk services like checking account balances and transaction history. The reversal in transaction value lead is evidence that more customers are headed towards mobile banking, affirming DBS’ Mobile First strategy set a few years ago.

 

Download the magazine print version of this article here.

Image: Fotos593 / Shutterstock.com

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Read more about the winners at the Digital CX Awards 2020 here.

AFFINBANK An Innovative Colony Enabling SMEs to Fly High

AFFINBANK: An Innovative Colony Enabling SMEs to Fly High

Entrepreneurs are the backbone of a growing economy – and Affin Bank Berhad (AFFINBANK) makes this a meaningful journey for them. The AFFIN Bank Group is  a financial services conglomerate focusing on commercial, Islamic and investment banking services, asset management and underwriting of life and general insurance business. Its tagline of “Banking Without Barriers” signifies the removal of boundaries within the processes of the Bank as well as its attitude in servicing its customers. Proof of this is its initiative called, ‘SMEColony’, the first bank-intermediated platform for SME community development in Malaysia.

The initiative was so successful that it was awarded Winner of “Best Digital Customer Experience in SME Banking” at the Digital CX Awards 2020 by The Digital Banker. The much talked-about CX awards event, running on its second year now, received 200+ nominations for various awards categories. Its distinguished panel of judges include industry veterans known for their integrity and unbiased adjudication from companies such as Forrester, EY, Fuji Xerox, Bain & Company, Wipro Digital and KPMG.

“This award goes out to all our inspiring entrepreneurs who continue to inspire us every day. Our mission is to create a meaningful journey for our SMEs to help them improve their business knowledge, enhance financial well-being and expand commercial networking. SMEColony is a multi-partner platform built with an SME-centric approach – and we’re indeed honoured and happy to be recognised for that,” said Lim Kee Yeong, Director of SME Banking for AFFINBANK.

“The growth of small and medium enterprises (SMEs) in Malaysia is nothing short of impressive.”

Leveraging on digital and mobile technology

The growth of small and medium enterprises (SMEs) in Malaysia is nothing short of impressive. According to data released by the Department of Statistics Malaysia (DOSM), SMEs registered a growth of 6.2% in 2018, slightly above the long-term average growth of 6.0% (2001 – 2017). The SMEs GDP contribution increased to 38.3% as compared to 37.8% in 2017.

One key contributor of the robust growth of SMEs in Malaysia is the adoption of digital and mobile technology, which is gaining strong traction among Malaysian entrepreneurs. However, the same pattern has not been quite apparent within the banking sector serving SMEs.

Recognising the significance of SMEs in Malaysian economic growth, AFFINBANK decided to take stewardship in building a strong affinity with the SME community including the start-ups. As such, AFFINBANK began its unique journey to nurture start-ups into the ecosystem over 2 years ago resulting in notable and public recognition. With an aim to continue its mission of a differentiated journey in meeting the needs of SMEs while providing unique solutions, the SMEColony mobile app was developed.

SMEColony is the first, and perhaps the best bank-intermediated platform to date, designed exclusively to serve the SME community. Available in both mobile and web,  the core propositions of SMEColony are targeted to (i) improve business knowledge with rich and insightful content;

(ii) enhance financial well-being via advisory services and comprehensive solutions; and (iii) expand commercial networking through events, talks and functions. SMEColony offers the SME community digital customer experience and allows them to engage and seek business solutions via AFFINBANK and its partners at no admission cost or subscription fees.

Helping SMEs Win

SMEs need to understand how emerging trends could affect their business while seeking the right resources and solutions that are vital for their business growth. The creation of the SMEColony app helps fulfil such crucial needs. The platform offers credible business resources tailored for the SME community. It allows SMEs to engage and enable them to seek solutions proactively, leveraging on the resources of a large conglomerate such as AFFINBANK. SMEColony adopts a multi-partner approach to strengthen and widen opportunities for SMEs while the bank acts as an intermediary. An open platform of SMEColony allows the SME community to get connected without barriers. The result? A truly thriving SME community able to take on more challenges and opportunities that can help propel Malaysia’s economy further.

SMEColony-small

 

Download the magazine print version of this article here.

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Read more about the winners at the Digital CX Awards 2020 here.

Can Digital Banking Alternatives Really Help Customers Take Back Control

Can Digital Banking Alternatives Really Help Customers Take Back Control?

Dear banks, Game Over. Disruptive challenger banks are here to wipe the floor with traditional banks, who have, according to Chad West, head of comms and marketing at challenger bank Revolut, failed to make their offering open and transparent to customers, and failed to give them control over their money. Digital bank alternative Revolut has scaled to 1.8 million customers in three years – and now offers cryptocurrency processing.

In this blog, we curate relevant and remarkable content related to digital banking, fintech and high-performance banking leaders. Watch this video from WIRED UK as Revolut explains how digital banking alternatives can help customers take back control.

 

>> To read more about the banking and finance sector and other exclusive features about the digital banking landscape, download the latest issue of The Digital Banker Magazine HERE.

DBS CEO Piyush Gupta talks about data challenges and opportunities in the digital age

DBS CEO Piyush Gupta talks about data challenges and opportunities in the digital age

DBS CEO Piyush Gupta shares his views on a range of issues, including digital banks, cybersecurity, banking trends and challenges, at a panel discussion at Singapore FinTech Festival 2019.

In this blog, we curate relevant and remarkable content related to digital banking, fintech and high-performance banking leaders. Watch this video from DBS to watch the highlights.

In Future, Will Passwords Still Be Relevant

In Future, Will Passwords Still Be Relevant?

“The average office worker in the United States must keep track of between 20 to 40 different username and password combinations. With so many passwords to remember, many of us use the same ones over and over, or have a running list of passwords saved somewhere. Passwords are a very serious and expensive security risk. It’s why companies like Microsoft , Apple and Google are trying to reduce our dependence on them. But the question is, can these companies break our bad habits?”

Watch this video from CNBC to understand why Big Tech wants you to ditch your password.


Update from CNBC (January 21, 2020): A website mentioned in this video, WeLeakInfo, was shut down by the Federal Bureau of Investigation and other law enforcement agencies on Friday, Jan. 17, 2020. The site claimed to have more than 12 billion usernames and passwords from more than 10,000 data breaches.

Passwords are a very serious and expensive security risk. A report by Verizon looked at 2,013 confirmed data breaches and found that 29% of those breaches involved the use of stolen credentials.

Another study by the Ponemon Institute and IBM Security found that the average cost of a single data breach in the U.S. was more than $8 million. Even when passwords are not stolen, companies can lose a lot of money trying to reset them.

“Our research has shown that the average fully loaded cost of a help desk call to reset a password is anywhere between $40 or $50 per call,” says Merritt Maxim, vice president and research director at Forrester.

“Generally speaking, a typical employee contacts a help desk somewhere between 6 and 10 times a year on password related issues,” Maxim said. “So if you just do the simple multiplication of six to 10 times, times 50 dollars per call, times number of employees, in your organization, you’re talking significantly hundreds of thousands of dollars or even potentially millions of dollars a year.”

 

>> To read more about the banking and finance sector and other exclusive features about the digital banking landscape, download the latest issue of The Digital Banker Magazine HERE.