In its 5th year of releasing TMT predictions with specific relevance to the MENA region, Deloitte continues to supply industry insights based on deep analysis, built around meetings with industry experts and field executives, as well as Deloitte’s proprietary programs of research with tens of thousands of consumers worldwide.
“For the first time in our 5 years of releasing MENA specific analysis on major market developments, we are including predictions for all three sectors together, and not splitting them into different sub-industries. This, by itself, is a reflection of the exciting industry we are in. An industry that continues to blur the boundaries of innovation, and reshape how operators, media players and tech companies collaborate and interact in an increasingly integrated market place,” said Emmanuel Durou, Partner and Technology, Media & Telecommunications Leader at Deloitte Middle East.
“Across the global and regional predictions, we believe that the distinction between sectors is fast becoming obsolete. The introduction of dedicated machine learning capability to smartphones is relevant across all industry sectors, not just the technology or telecommunications verticals. The transition to 5G and resulting implications on machine to machine communication is a critical enabler to new technology adoption, starting with self-driving cars. IoT itself is the epitome of this borderless ecosystem with operators and technology companies working closely together to shape the cities and lives of tomorrow. Cybersecurity is an evergreen topic in the region rising threats to media companies and Telcos equally, and requiring cross sectorial regulations and safety measures,” he added.
2017 predictions for the Middle East include:
Deloitte Middle East predicts that the average mobile internet speeds in some of the GCC countries will reach 30 Mb/s by year-end and around 50 Mb/s by 2018. By end of 2017, over 40 carriers regionally are likely to offer LTE-Advanced (LTE-A), and over 10 should have LTE-Advanced Pro (LTE-A Pro) networks. We expect 5G to be launched in its pre-standard form starting 2019 in specific regions within the GCC and a large-scale commercial rollout to the wider metropolitan areas by 2020. During that time, 5G speeds are likely to co-exist with multiple other generations of cellular networks working in conjunction with 3G, LTE-A and LTE-A Pro networks. Looking further ahead, by 2021 we estimate the 5G subscriber base in the GCC to reach around half a million, growing at about 34% CAGR across GCC countries until it becomes the prevalent standard by 2025.
Self-driving and 5G
Deloitte predicts that in the next three years the GCC region will see a steady introduction of autonomous connected vehicles in controlled, public transport routes. This initial launch will include cars which are not fully driverless but connected and assisted, exchanging valuable road information within current networks. Following the 5G launch in 2021, we predict that driverless technology adoption will grow exponentially until all vehicles will be capable of driving autonomously 20 years later. 5G will enable vehicle-to-vehicle connectivity technology by lowering costs, battery consumption and latency for all machine-to-machine communication applications.
Deloitte Middle East predicts that connected entertainment (video streaming, smart TVs and wireless speakers etc.) and connected health devices (wearables etc.), which have already reached a certain level of maturity in the GCC, will continue their upward surge by growing in revenues at an average of 10% and 20%, respectively, in the GCC in 2017, which is broadly in line with international growth rates.
There has been, so far, limited take-up of connected home appliances such as smart thermostat, lighting, and home appliances (smart oven, smart fridge, smart dishwasher etc.) in the GCC. We believe that this segment will still witness a slow increase in adoption on the back of new product launches, and the implementation of energy efficiency policies by local authorities. Similarly, we also expect connected cars to remain an emerging product this year, as the technology is still coming into place, and there are limited models with affordable price points available in the market.
Deloitte Middle East predicts that the Middle East should be on higher alert than the rest of the world as it will see an increase in the frequency and intensity of cyber incidents across all attack vectors. Further, and with the recent emergence of ransomware and other sophisticated malware that target financial infrastructure, we predict that Middle East residences and institutions are twice as likely to encounter malware when compared to the global average. In totality, Deloitte Middle East predicts that Middle East institutions will potentially suffer an additional $130M in costs related to cyber-crime in 2017.
Deloitte predicts that blockchain will find widespread use in the GCC, where it will find uptake in the public sector potentially saving $3.5 billion in leakages over the next couple of years, by using blockchain-based identity management for the disbursement of social welfare. We further expect that four out of the of six countries in the GCC will pilot some form of implementation of digital identity on blockchain at the local or national government level, and 10 million identity records will be put on blockchain over the course of the year.
For the full list of 2017 Middle East TMT predictions, go to: http://bit.ly/2mmriQc
Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”), its network of member firms, and their related entities. DTTL and each of its member firms are legally separate and independent entities. DTTL (also referred to as “Deloitte Global”) does not provide services to clients. Please see www.deloitte.com/about for a more detailed description of DTTL and its member firms.
Deloitte provides audit, consulting, financial advisory, risk management, tax and related services to public and private clients spanning multiple industries. With a globally connected network of member firms in more than 150 countries and territories, Deloitte brings world-class capabilities and high-quality service to clients, delivering the insights they need to address their most complex business challenges. Deloitte’s more than 220,000 professionals are committed to making an impact that matters.
About Deloitte & Touche (M.E.):
Deloitte & Touche (M.E.) is a member firm of Deloitte Touche Tohmatsu Limited (DTTL) and is a leading professional services firm established in the Middle East region with uninterrupted presence since 1926.
Deloitte provides audit, tax, consulting, and financial advisory services through 26 offices in 15 countries with more than 3,300 partners, directors and staff. It is a Tier 1 Tax advisor in the GCC region since 2010 (according to the International Tax Review World Tax Rankings). It has also received numerous awards in the last few years which include best employer in the Middle East, best consulting firm, the Middle East Training & Development Excellence Award by the Institute of Chartered Accountants in England and Wales (ICAEW), as well as the best CSR integrated organization.
AI: Do the Right Thing
By Alix Melchy, Jumio VP of AI
The application of emerging technologies such as AI, cloud, blockchain and IoT in financial services has altered the traditional operating models of financial institutions, the competitive dynamics of the industry, the role of people in those institutions and the landscape of the financial system as a whole. In fact, AI is positioned as an essential investment, with the World Economic Forum arguing how it is set to become central to the fabric of financial institutions.
While the adoption of AI in financial services may be in its infancy, the use cases are ever growing. From recommending loan and credit offerings to detecting fraud, 94% of financial services in European and Middle Eastern markets believe that AI will disrupt their business. The direction and the awareness of AI is clear but it is essential that companies invest now, as if done too hastily, the process is marred by pitfalls.
Despite the transformative promise of AI and machine learning algorithms, we have seen its application come under scrutiny in other industries. Take the UK A-Level exam grading debacle that dominated headlines back in August. Exam grades of students living in certain UK postcodes were disproportionately and negatively impacted, while other students saw their results inflated. This was down to an algorithm implemented by Ofqual that was set to predict grades using historical data including grades obtained at exams in previous years.
The incident raises the question as to what would happen if the algorithm used in this instance was applied to a financial decision. The same biases could negatively impact the way millions of consumers and businesses borrow, save and manage their money.
It is therefore imperative that financial institutions learn from this scenario, ensuring that when implemented in financial decision-making, AI is nothing short of a success.
AI is no fairy godmother
While many tout the game-changing effects of the looming AI revolution, it’s fundamentally important to understand that AI is not magic. Instead, we need to learn to set reasonable expectations with AI so not to paint an unrealistic picture of its power.
In order to start out on the right track, businesses must first define and align on the task they want the algorithm to perform before it can be developed and implemented. Articulating the problem to be solved is the prerequisite for a solid framework of development and evaluation of your algorithms.
Removing bias in AI
AI is the tool, not the hand that wields it or the eye that guides it. It is a type of learning system that requires data, training integration, and course correction. Just as we would train a young engineer to use a tool correctly, we are training AI systems to become expert learning systems through the data, process and people.
Therefore, in order to solve a problem using AI, the task must be expressed in a form which a machine can understand and the machine must be supplied with the necessary data to perform or otherwise learn to generate predictions that enable it to accomplish its objective. Without strong and relevant data underpinning an AI model, it will never be able to produce strong and relevant results.
To design a fair algorithm, the key is to collect a sufficient amount of data so that the algorithm can be trained to represent an entire community. While it is possible to buy datasets to speed up the process, when doing so, it is essential that the data meets your required criteria rather than simply being a large data set. For the financial services sector, this enables employees to treat customers fairly and, when combined with appropriate modelling and processes, allows them to maintain transparency and accountability in their decision-making processes to avoid legal claims or fines from regulators which can cause deep reputational damage.
Building back better
As the Ofqual issue revealed, a preliminary, small-scale algorithm test is an essential step before applying it into a real-world scenario. A pilot testing phase will help a business to amend the design to identify unnecessary costs and time expenditures, while also better understanding the data. As this was not sufficiently done in the Ofqual case, the algorithm simply did not provide the right answer to the problem it was trying to solve.
Championing ethical AI
More than ever, companies are realising one simple truth: failing to operationalise data and AI ethics is a threat to the bottom line. Missing the mark can expose companies to reputational, regulatory and legal risks. Here are some key areas that businesses should consider when leveraging AI models:
- Usage consent: make sure that all the data you are using has been acquired with the proper consent
- Diversity and representativity: AI practitioners should consider how diverse their programming teams are and whether or not they undertake relevant anti-bias and discrimination training. This will draw upon perspectives of individuals from different genders, backgrounds and faiths which will increase the likelihood that decisions made on purchasing and operating AI solutions are inclusive and not biased
- Transparency and trust building: accurate and robust record keeping is important to assure that those impacted by it know how the model works
The ways AI can be utilised in the financial services industry is increasingly growing. An example is the use of document-centric identity proofing space whereby an identification document, such as a passport, is matched with a selfie of the user to confirm real and virtual identities. This will be an essential area of focus for financial services companies as they look to confirm that users are who they claim to be when the physical branch is diminishing. When analysing if a person is the same as the picture on their documentation, for example, a biased AI model can completely undermine the decision made.
However, it’s reassuring to see that the 2020 Gartner Market Guide for Identity Proofing & Affirmation predicts that by 2022, 95% of RFPs will have introduced clear requirements around minimising demographic bias. This demonstrates how organisations are now becoming more aware of the detrimental impacts that demographic bias in the performance of identity-proofing processes could have on their brand as well as being clear on the legal consequences they risk facing.
In turn, there is a real opportunity to leverage AI solutions to provide the best service, but financial institutions must ensure that they are doing so in an ethical, accurate, and representative way.
SFF x SWITCH 2020 to Feature 40 Global Satellite Events and 24-Hour Online Experience
The Monetary Authority of Singapore (MAS) and Enterprise Singapore (ESG) announced today that more than 40 global satellite events will take place across the world as part of the Singap ore FinTech Festival (SFF) x Singapore Week of Innovation & TeCHnology (SWITCH) 2020.
- To be held from 7 to 11 December, SFF x SWITCH 2020 will feature a unique hybrid format that combines a 24-hour online event platform with global satellite events around the world. This new hybrid model will provide participants with greater access to the global FinTech and deep tech communities who are looking to discover partnerships, draw investments, and boost sales cycles.
- SFF x SWITCH has worked with a network of global partners to host the global satellite events (refer to Annex A). They comprise physical events in selected cities in accordance with local safe distancing measures as well as digital-only events. They will bring together content from innovation hubs and tech showcases around the world, and provide in-person attendees access to networking opportunities with industry leaders and sponsors. In collaboration with MAS and ESG, SingEx Group will manage the physical and digital experiences for attendees and ensure a seamless execution of the FinTech and innovation showcases across the cities.
- SFF x SWITCH will feature a 24-hour online experience over five days. This online event platform will feature a digital city, supported by partners including Accenture, Microsoft and Pico Art International. The digital city will feature more than 800 speakers from around the world, including leaders in finance and technology, entrepreneurs, policymakers, and officials from multilateral agencies. Participants can access live content broadcasts running round-the-clock and on-demand sessions. Some of the confirmed speakers include:
- Dr Abhijit Banerjee, 2019 Nobel Prize in Economics, Ford Foundation International Professor of Economics, Massachusetts Institute of Technology (MIT)
- Kristalina Georgieva, Managing Director, International Monetary Fund
- Guo Shuqing, Chairman, China Banking and Insurance Regulatory Commission
- Hong Feng, Co-Founder and Senior Vice President, Xiaomi
- Arianna Huffington, Founder and CEO, Thrive Global, Founder, Huffington Post
- Sallie Krawcheck, Chief Executive Officer & Founder, Ellevest
- Satya Nadella, Chief Executive Officer, Microsoft
- Nandan Nilekani, Co-Founder and Chairman, Infosys
- Henry M. Paulson, Jr, Founder and Chairman, Paulson Institute
- Sundar Pichai, Chief Executive Officer, Google and Alphabet
- Dr Raghuram Rajan, Katherine Dusak Miller Distinguished Service Professor of Finance, University of Chicago’s Booth School
- Eric Yuan, Chief Executive Officer and Founder, Zoom
- Albert, Co-Founder, Traveloka
- Dr Chi Youngcho, President and CIO, Hyundai Motor Group
- Timothy Draper, Founding Partner, Draper Associates
- Arvinder Gujral, Managing Director SE Asia and Senior Director Business Development – APAC, China, Australia, Twitter
- Shobana Kamineni, Executive Vice Chairperson, Apollo Hospitals Enterprise
- Lei Ming, Co-Founder, Baidu; Former CEO and Founder, Kuwo Science and Technology; Founding Partner, AIBasis Ventures
- Henry Ma, Executive Vice President and Chief Information Officer, WeBank
- Candice Ong, Chief Commercial Officer, ShopBack
- Lars Reger, Group Chief Technology Officer, NXP Semiconductor Germany GmbH
- Professor Sir Adrian Smith FRS, Institute Director and Chief Executive, The Alan Turing Institute
- Professor H.S. Philip Wong, Willard R. and Inez Kerr Bell Professor in the School of Engineering, Stanford University
- Ye Gang, Group Chief Operating Officer, Sea Ltd
- The SFF Global-Common Channel will feature five global summits on the themes of: economics, infrastructure, impact, investor, and talent. They will focus on driving cross-border commercial activity to support pandemic recovery, and how financial institutions should position themselves in 2021. The SWITCH Global Channel, curated by SWITCH’s global innovation partners (refer to Annex B), allows participants access to market knowledge, opportunities, insights and tips on business culture from over 42 cities in 31 countries across Africa, Asia (China, India and Southeast Asia), Europe, Middle East, North America and Northeast Asia & Oceania.
- A digital map will show all SFF x SWITCH activities across Singapore, with dedicated zones for various activities, including an international zone, early stage and growth stage FinTech zones, talent zone, technology showcase zones, and a networking zone. Participants will be able to visit locations on the map via a searchable and interactive directory of organisations and activities, tailored to their interests and profiles. Participants can meet and network with attendees on the event platform and schedule 1-on-1 meetings, by leveraging on the platform’s business matching functionality.
- Sopnendu Mohanty, Chief FinTech Officer, MAS, said, “The global pandemic has led to a reimagination of how we can deliver SFF x SWITCH as a global platform. To recreate the connectivity, collaboration and networking that have become the hallmarks of SFF x SWITCH, this year’s unique hybrid format will break new ground to create a truly global and inclusive event for the FinTech community. We are delighted to work with key global partners to deliver over 40 global satellite events for attendees across the globe, and Microsoft and Accenture to design this first-of-its-kind global platform for the FinTech community to innovate and forge new connections, anchored on the delivery of a powerful, new digital experience at scale.”
- Edwin Chow, Assistant Chief Executive Officer (Innovation & Enterprise), Enterprise Singapore, said, “While SFF x SWITCH is being run in a new, unprecedented way, our aim to enable networking and collaboration has not changed. In fact, we are very pleased to see that SWITCH has attracted even more global innovation partners this time, with established names such as 500 Startups, Sunway Group and VinaCapital joining us at various thematic panel discussions. This digital format not only enables the deep tech and innovation community to access deep market knowledge; it allows us to connect across geographies and time zones at a much faster pace, making this event a truly global one.”
- “Together with our partners we’ve designed the entire customer journey identifying critical touchpoints for optimal experiential engagements, paving the way for a bold new format that’s driven by customer insights. We’re proud to be the nerve centre for SFF x SWITCH orchestrating the global event experience across the satellite cities, online and offline, through our hybrid events studio in Singapore as well as robust capabilities in content, digital and operational excellence. We look forward to showing the world a new standard of audience engagement made possible with our established network of community partners from around the world”, said Aloysius Arlando, Chief Executive Officer, SingEx.
 The digital map will feature dedicated areas for various SFF x SWITCH activities, comprising the SFF x SWITCH Content Channels, International Zone, MAS Zone, Sponsor and Exhibitor Zones, Early Stage FinTechs Zone, Growth Stage FinTechs Zone, APIX, Talent Pavilion, Blockchain Zone, SME Zone, SFF AI Summit @Bridge+, Networking Zone, SWITCH Village and SG Blockchain Village.
Leumi UK completes core banking upgrade with Finastra
Multi-specialist bank Leumi UK improves customer experience and streamlines processes with updated technology
Leumi UK, the London subsidiary of Israel’s largest banking group, has selected Finastra, one of the world’s largest fintechs, to upgrade its core banking systems.
For Leumi UK, this is the culmination of an extensive bank-wide programme to boost the efficiency of internal processes. The upgrade provides a solid foundation on which to make further improvements to the speed and functionality of Leumi UK’s processes.
The enhanced core banking system is a fundamental component of Leumi UK’s new IT strategy, as defined by Chief Technology Officer, Alon Shmuel. This will enable the bank to focus on business growth, as it builds momentum in its specialist areas of hotel and property finance. With this latest technology in place, it is now better equipped to onboard new business and ultimately improve the overall customer experience.
Alon Shmuel, Chief Technology Officer at Leumi UK, says: “This upgrade is part of the promise to our customers to constantly build upon the services and solutions we offer. Thanks to Finastra, we can ensure that we are using the latest software and most up-to-date technology to provide an even better, faster service to our customers. We are very grateful to Finastra for the expertise, dedication and professionalism they exhibited as we undertook this ambitious endeavour together. Their support allowed us to complete the project in under nine months, despite the challenges we faced from the Coronavirus pandemic.”
John Mitchell, Vice President Global Services Europe at Finastra said, “Finastra has worked hard to deliver a robust services strategy that enables us to support customers, like Leumi UK, and help them to achieve their goals, whether for a new implementation or a core upgrade. This is particularly crucial with current restrictions preventing us from being on the ground with our customers. We are delighted to support Leumi UK during its transformation and pleased that we were able to complete the project together ahead of schedule. Our collaborative working relationship was a significant mitigation to the challenges faced with the onset of the pandemic.”
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