Connect with us

Banking

How Private Banks can rethink their Brands to appeal to a New Generation of Investors

Published

on

How Private Banks can rethink their Brands to appeal to a New Generation of Investors

By John Clark, Planning Director at brand design agency Coley Porter Bell

The profile of the traditional private banking customer has changed dramatically. Whether it’s increased competition from fin-tech start-ups, or the rise of crypto currency, traditional institutions steeped in heritage are no longer automatically on the wish lists of young entrepreneurs and agile investors.Not only do private banks need to engage a whole new set of millennial customers, they need tore-evaluate their traditional approach to brand strategy and design to capture the imagination of the next generation.

John Clark

John Clark

Despite this, the more traditional values of stability, personal experience and judgement are still important and new, digital challengers will struggle to replicate these attributes. While research from Merryl Lynch on high net worth millennials shows there’s a need for guidance,(as few consider themselves knowledgeable about financial products and investments), it means banks and wealth managers will need to push beyond both the traditional clichés of wealth, and the misconceptions of millennial stereotypes. They will need to build brands with relevance and durability. With this in mind, we’ve identified six ways in which private banks could begin to think differently about building their brand.

Be easy to live with

Shaped by their experience with non-financial digital brands like Google and Amazon, on-the-move millennials expect to always be ‘always on’ and have control.  Brands need to fit into their life; not the other way around. For private banks, using new technologies could free the relationship from being purely face-to-face in an office setting; advice and interaction could be provided wherever, to whoever and however it is needed. For instance, taking a leaf out of Babylon’s book – the subscription health service provider – private banks might consider offering a service that allows video calls at any time of the day or night instead of face-to-face meetings. This means someone on a business trip abroad, can get the advice they need without waiting to get home. 

Work with me, not for me

At work and as managers, millennials tend to spend more time inspiring and empowering their colleagues than previous generations. This style of professional relationship is likely to extend to their expectations of their wealth manager. Indeed, when it comes to their investments, research from Deloitte found millennials want to remain in the driver’s seat: they want to understand and feel empowered to make investment decisions, fully understanding what is involved.In response, private banks may wish to shrug off their reputation as sages, and position themselves not just as partners, but as coaches or companions that are there to develop and grow with their customers.Again, taking inspiration from outside the category, in the world of beauty products, new skincare umbrella brand, Deciem, has achieved category-disrupting growth not by formulating the best creams, but by putting ingredient decisions into the hands of the consumers. With a portfolio of 200 products across 10 brands, Deciem taps into the millennial desire to both understand and be given permission to do what they think is right.

The wisdom of my peers

Millennials grew up immersed in online communities where the wisdom of the group, the ethic of crowd-sourcing, and a learn-it-yourself culture are valued. It’s not surprising the same behaviors can be seen when it comes to their finances. According to Deliotte, when making an investment decision, millennials are more likely to seek out and collate opinions and views from multiple sources. So, while private banks are there to provide expert advice, they shouldn’t expect millennials to take it at face value. Instead they can facilitate the conversation and provide platforms for investors to share their knowledge. UK based online investment service, Wealthify, is a good example: investors can create investment “circles” to share their investment experience and receive a discount on their annual management fee as they grow their owncircle. 

Do good and make money

When it comes to money, millennials don’t want it to compromise their personal values: they are less likely to measure their success in terms of wealth alone and they care about their personal impact on the world. For example, HSBC research with millennial entrepreneurs found they are motivated to go into business to both better themselves, and have a positive impact on their community.

This sense of purpose is likely to extend to their approach to investments, with millennials seeking out banks that share their personal values.Private banks will need to demonstrate that they can help clients grow their wealth, while having a positive and visible wider social impact. In the mass market, newer financial players are already building purpose into their business and brands. For example, US insurance provider, Lemonade, donates what’s left from annual unclaimed premiums to causes you care about, and Abundance Investments uses funds under management in projects and businesses take an active role in creating a better future.

Understand my personal goals

The long-term financial goals of millennials have shifted and may feel unfamiliar to private bankers. According to Merrill Edge, they are the first generation to plan for financial freedom or to afford to live a desired lifestyle, rather than the more traditional goals of say a comfortable retirement. They also don’t want to be treated as a homogeneous segment: they want advice that is unique to them and tailored to their life and aspirations.

To attract new millennial customers, banks will need to adapt their brand and communications to show they understand what their next generation of investors care about. The stuffy, clichéd visual language of wealth is unlikely to be appealing. With clients, private bankers will need the emotional intelligence to help balance what could well be the conflicting and confusing financial goals of a millennial investor. Technology can also play a role in helping clients not only understand but explore and feel the consequences of decisions. For example, MeetInvest has designed a fantasy football approach that allowed investors to select and build an investment team, and Merryl Lynch created an app that aged photos of their customers to help them build empathy for their future needs.

Old world values with new world relevance

There is a tendency for private banks to either focus on themselves – their heritage, expertise or track record – or the functional, more transactional side of their business in their branding. This is then reflected in a visual identity that uses traditional, stuffy imagery or has a clinical style that feels more‘big bank’ than ‘personal banker’. While it’s key to create meaningful changes in the brand experience, the visual identity also plays a big role in convincing the conscious and seducing the subconscious of both prospects and clients.

If millennials care about convenience, inspiration and openness when it comes to their investments, then these values should be visually expressed through every touchpoint: from the welcome letter, to the welcome desk, every interaction is an opportunity to express your point of view and create the seamless, modern branded experience that millennials expect. At the same time, it’s important for banks to stay authentic and build on their strengths and DNA while making them relevant to a new generation of investors. Lombard Odier is a great example of this. Having survived 40 financial crises and emerged stronger each time, Lombard’s brand is now built on a core idea of “capacity for reinvention”. In a fast-changing modern world, the brand now speaks to the banks’ ability and desire to constantly rethink to bring about financial stability.

Ultimately there is a need for private banks to balance innovating their experience and brand to reach new audiences, while reinforcing their reason for being. Private banks can draw on the learnings from brands that are already succeeding with millennials to help redefine their client relationships, while also restating their purpose as modern-day beacons of trust within the banking industry.

Banking

Bank fraud prevention in a post-COVID-19 world

Published

on

Bank fraud prevention in a post-COVID-19 world 1

By Pierre-Antoine Dusoulier, Founder and CEO, iBanFirst

Fraud on the rise

According to recent research from a leading UK retail bank, there was a 66 per cent increase in reported scams in the first six months of 2020 compared with the last six months of 2019 – due to the COVID-19 pandemic.

Across the summer months, Action Fraud UK reported a total financial loss of £11,316,266 by 2,866 victims of coronavirus-related scams.

The rise in fraud rates is a warning that banks, building societies and other financial providers need to be as alert as ever in identifying fraud.

So, what do banks need to do to ensure their customers are protected from fraud in a post-COVID-19 world?

Educate your customers to safeguard against fraud

On the customer level, banks need to be informing their customers on the types of common fraud to ensure that they are protected for all eventualities.

Authorised push payment scams are one of the fastest growing types of fraud. According to the FT, £354 million pounds was stolen this way last year. It is where a company or individual is tricked into paying money into a criminal’s account. Emails come from a genuine email address but are then intercepted by a criminal, so it’s imperative that businesses have end-to-end email encryption, and the customer double-checks the account details with the supplier on the phone prior to making a payment.

At the same time, scammers can also exploit the company’s invoicing process, where criminals create a bogus invoice for a small amount and send it to a company’s accounting department. If the finance team does not identify this as fraudulent, it can result in the business losing a considerable amount of revenue over a long period of time.

Supplier fraud is also a widespread scam. This involves the fraudster taking on the appearance of a supplier that has changed their bank details. The fraudster will have collected information on the suppliers of the targeted company, in order to pose as an official supplier. This can be prevented by ensuring that the supplier is contacted to confirm the legitimacy of the communication. It’s important not to call or email the supplier using the details provided on the suspected fraudulent correspondence. Instead they must check the original details of the supplier and speak to them on their official telephone number or email on file.

Banking malware is the least commonly cited type of fraud but has a greater financial risk attached to it. Malware is sent by email redirecting the recipients of the message to a fake banking interface, as a way of transferring funds to offshore accounts.

Remodel processes post-COVID-19 to keep customer data safe

To fight cyber fraud and scams, banks must also play their part. In a world where entire workforces are working from home banks must remain vigilant with customer data. COVID-19 has created a change in working habits and banks need to carry out the right level of training for its employees to protect customer data. Virtual team meetings and remote data sharing poses a threat to exposing sensitive information to malicious actors, and banks need to put the necessary safeguards in place.

All virtual meetings should use the banks’ private company network, and file sharing should be carried out through secure, encrypted company drives. Meanwhile, banks need to provision for all employees to receive regular software updates that will keep customer data safe, and ensure that they are aligned with new and existing data processing regulations.

Monitoring suspicious payments

A vital element to fraud detection is through monitoring customer transactions in real time, and harnessing emerging technologies such as artificial intelligence and machine learning to spot the signs of a scam or fraud before it is too late.

One way that banks protect businesses from fraud is through keeping a log and examining regular transactional history. Any transactions which appear suspicious based on location, amount, the beneficiary, and the method will be alerted to the business customer, to mitigate the immediate and future financial risk to the business.

Know your transaction

To understand financial flows better, every bank has a Know Your Customer (KYC) engine. This is a payment infrastructure that supports onboarding processes and risk-based transaction monitoring. This system is already well known and we don’t need to elaborate on this further, as it is the fundamental building block to ensure the highest level of traceability across all transactions – including remittances and receipts of funds and foreign exchange transactions internationally.

However, KYC is limited and doesn’t include real-time analysis. What can be overlooked is a KYT engine – Know your Transaction. The aim of KYT (Know Your Transactions) is to identify potentially risky transactions and their underlying unusual behaviour for detecting money laundering, fraud or corruption. An automated concentration of transactions with accurate and relevant information directly from the original data sources is essential.

Finally, banks and payment companies need to implement anti-fraud modules to defend against cyberattacks, based on the latest algorithms capable of analysing transactions issued in real time and detecting anomalies or suspicious behaviour upstream, strengthening the security and transparency of payments and building a network of trust between issuers and recipients of payments.

In a post-COVID-19 world it’s clear that scams will become more common place. Within this environment there is a shared responsibility when mitigating the risk of financial fraud. The bank must educate and inform customers to enable them to protect themselves, while ensuring a robust technological infrastructure and ways of working are in place that protects customer data; their finances, and fundamentally their business and livelihood.

Continue Reading

Banking

How One Bank Successfully Responds to Sophisticated Threat Actors

Published

on

How One Bank Successfully Responds to Sophisticated Threat Actors 2

By Robert Golladay, Strategic Accounts Director, Illusive Networks

Cybercriminals and hacktivists have a special fondness for financial institutions. Continuous business innovation, complex ecosystems, merger and acquisition activity, fintech, cloud adoption and a growing consumer-driven attack surface multiply the problem for financial organizations. Despite the vast resources financial institutions devote to cybersecurity, one challenge has been especially difficult to solve – that of detecting and stopping APTs before real damage is done.

Securing cloud-based banking

An active lender in the UK sought a new way to protect its customers and the valuable assets it holds. The bank needed to:

  • Defend customer and employee information from compromise
  • Detect and thwart sophisticated attacks
  • Effectively defend cloud-based operations across accounts and instances

As a cloud-first company, the bank’s preference is to always invest in next-generation technology for operations and security infrastructure. In May 2016, with the help of Amazon Web Services (AWS), it became the first bank in the UK to be fully cloud hosted. The bank also uses AWS to deliver a financial technology service that helps lenders make informed decisions through data and automation.

Security is always a priority, which is one of the reasons the company chose AWS, conducts regular penetration testing, and performs advanced attack simulations. To maximize effectiveness of its layered security infrastructure, the company continually trains its employees and reinforces data security best practices.

In particular, the bank sought additional safeguards from sophisticated threats that evade other security measures, such as advanced persistent threats, as well as gain insight into attacker tactics and techniques. The new layer needed to be cloud-based for high scalability and flexibility, and it had to defend the company without time-wasting false positive alerts. The security team looked at deception technology and chose a solution that allowed them to gain real-time verification of anomalies and lateral movement in the network.

Choosing deception

The deception solution enabled the bank to focus on attackers’ behaviour and perspective. The solution’s expertise in attacker methodology augmented the bank’s internal capability to detect novel attacks, while enabling rapid and adaptable coverage in its cloud-based environment.

The bank’s deception solution uses agentless, intelligence-driven technology that creates a dense web of deceptions and effortlessly scales across the infrastructure. Featherweight deceptions on every endpoint look exactly like the bank’s real data, access credentials and connections. When an attacker is confronted with deceptions, this deceptive view of reality makes it impossible to choose a real path forward. One wrong step triggers an alert to the bank’s security team.

The bank’s CISO found it invaluable to be able to deploy a solution that creates doubt and confusion in an intruder’s mind. When attackers can’t distinguish between real and deceptive assets, the security team can collect information and apply intelligence to patterns that it has observed during that time period of activity. The solution simultaneously sharpens the bank’s investigative process and constrain the attacker.

The lender easily deployed deception technology across its complex environment, scaling it across AWS instances and accounts. The IT security team now has continuous visibility and confidence that these defences enable them to thwart sophisticated threat actors.

Deceptively secure

The bank gained proactive threat response and the assurance that an alert represents a real issue. These alerts are only triggered when an attacker engages with a deceptive asset. At that point, the deception technology immediately begins capturing forensic data from the system where the attacker is operating, presenting real-time forensics and a quantifiable measure of potential business risk. It uncovered, for example, malicious processes trying to operate on an endpoint.

The deception solution enables the lender to be much more proactive. It detects and analyses attacks in real time to produce actionable alerts, directing the security team to relevant and valuable conclusions. The technology provides exceptional, innovative coverage for malicious pivoting and lateral movement. It uncovers the in-depth, sophisticated actors who evade other countermeasures and gives security analysts direct visibility into targeted attacks, which they find invaluable.

A laser-focused approach

The financial sector remains a perennial favourite of the cybercriminal crowd. As networks become more complex, their perimeters all but disappear, creating the need for stronger and more comprehensive security than ever previously imagined. Advanced persistent threats are a particular concern, as they are notoriously difficult to detect before significant damage is done. For financial institutions, the reputation damage alone may be insurmountable.

Banks and other financial services organizations pour resources into cybersecurity, but one option that needs further exploration is deception technology. This method of security monitors for lateral movements toward critical assets and thus provides a powerful alternative or enhancement to traditional monitoring approaches. Security teams can see attackers’ proximity to those crown jewels early in the attack cycle, buying time for careful response. As the lender above learned, deception technology cuts through the noise of alerts to deliver the intel financial institutions need to act quickly and safeguard their high-value data.

Continue Reading

Banking

Why banking and finance need to move qualifications online

Published

on

Why banking and finance need to move qualifications online 3

By Rory McCorkle, Senior Vice President, PSI Certification and Education Services

The global banking and finance sector often presents a strange contradiction when it comes to technology. On one hand, the sector is leading the way in blockchain technology, big data and Artificial Intelligence. On the other hand, many large financial institutions are falling behind in their digital transformation efforts, with internal processes as well as the moving the customer experience online. Particularly when compared to fintech and new challenger banks.

A report last year by Accenture found that just 12% of large traditional banks surveyed have fully committed to digital transformation and 50% of banks made little progress. The remaining 38% are in the midst of their transformations, but their digital strategies lack coherence.[i]

One area of digital transformation that has been particularly slow is access to qualifications and certifications. Many exams in the banking and finance sector continue to use Paper Based Testing (PBT). However, COVID-19 has accelerated the transition from PBT to Computer Based Testing (CBT), proving irrevocably that change is possible – regardless of the size of your organisation, number of candidates or security requirements.

Stay current

In a heavily regulated environment that is undergoing increased scrutiny, a high level of certification and compliance is a necessity for many working in the industry. And credentials that hold such significance need to be securely and fairly assessed. This is where CBT offers numerous benefits. For organisations there is security, integrity, flexible capacity, increased reach and a streamlined exam administration process. And for candidates, CBT provides flexibility, convenience, accessibility and increased choice.

Despite these benefits, some organisations still have reservations and have been slower to make the move to CBT. In more traditional professions, such as finance, there can be a greater reticence. This is likely to be based on the historic prestige of PBT, as well as a desire to stick to more traditional methods. However, with more learning completed online, and educational resources shifting to digital from primary education to CPD, expectations around assessments are changing.

Up-and-coming candidates in all professions, particularly those who are digital natives, are starting to question outdated methods. Organizations will need to adapt to stay current and relevant with their market. What’s more, technological advances have now combined with the coronavirus pandemic to increase the demand for remote business services. Meaning that a growing number of organisations in the banking and finance sector are moving to CBT.

Increased security

Technology offers burgeoning options to increase test security with CBT. Linear-on-the-fly testing (LOFT) for example allows you to easily change items for each candidate, while maintaining the fairness of the exam – rather than the fixed forms used in PBT.

With LOFT, every candidate is given a unique set of items, making cheating a lot more difficult. And with no need to ship test papers around the country, there’s significantly less risk of physical security breaches with CBT than with PBT.

With the movement away from paper and pencil testing, advances in online proctoring have also dramatically increased the ability to deliver secure online assessments. Using a webcam and microphone, online proctoring provides test security for exams, while offering candidates additional flexibility and convenient scheduling.

Even before COVID-19, online proctoring was becoming far more commonplace. In 2018, there was a 10% increase in organisations using online proctoring with video/sound recording and identity authentication as part of the exam process compared to 2017.[ii] And COVID-19 has reinforced the fact that it is possible to effectively move to CBT side by side with online proctoring – and move quickly.

Future possibilities

Testing has changed a lot during its history but the reasons for adopting CBT have remained the same for decades – fair and reliable testing delivered at scale. Nearly all tests that are completed with a paper and pencil can be adapted for CBT.

For organisations in the banking and finance sector, recent technological advances have provided many more options to reach candidates. At the same time, technology has significantly increased the security for important online assessments that will not only affect a candidate’s future, but might also impact the future and reputation of their profession.

As with any change, the move from PBT to CBT must be managed carefully and communicated clearly. And with best practice in place, it is possible for any organization, regardless of size and number of candidates, to make the move to CBT.

Continue Reading

Call For Entries

Global Banking and Finance Review Awards Nominations 2020
2020 Global Banking & Finance Awards now open. Click Here

Latest Articles

Return to Work Doesn’t Mean Business as Usual When it Comes to Travel and Expense 4 Return to Work Doesn’t Mean Business as Usual When it Comes to Travel and Expense 5
Top Stories20 hours ago

Return to Work Doesn’t Mean Business as Usual When it Comes to Travel and Expense

By Rob Harrison, MD UK & Ireland, SAP Concur The last few months have been an exercise in adaptability for...

Why technology is key to the future of auditing 6 Why technology is key to the future of auditing 7
Technology20 hours ago

Why technology is key to the future of auditing

By Piers Wilson, Head of Product Management at Huntsman Security The Financial Reporting Council (FRC), which is responsible for corporate governance,...

Staff training crucial for SME recovery post-COVID 8 Staff training crucial for SME recovery post-COVID 9
Business1 day ago

Staff training crucial for SME recovery post-COVID

47% of UK’s top performing SMEs provide regular, formalised training for all staff Despite this, 15% of small businesses report to...

What Is Globalization 10 What Is Globalization 11
Business2 days ago

What Is Globalization

What is globalization? Globalization, or inter-connectedness, is the ever-growing process of integration and interaction among countries, individuals, businesses, and even...

What Is Microsoft Teams 12 What Is Microsoft Teams 13
Business2 days ago

What Is Microsoft Teams

Microsoft Teams is an application and web-based collaboration tool that combines chat, videos, online collaboration, document storage, and collaboration with...

What Is Capitalism 14 What Is Capitalism 15
Business2 days ago

What Is Capitalism

What is capitalism? Is it a great economic system or just another economic system that is not so great? Well,...

How To Start A Youtube Channel 16 How To Start A Youtube Channel 17
Business2 days ago

How To Start A Youtube Channel

How to Start a YouTube Channel For Your Business: Do you have a blog or website? If you do, it’s...

What is URL 18 What is URL 19
Business2 days ago

What is URL

A Uniform Resource Locater, colloquially known as a URL, is an identification to a certain web resource, a directory or...

What Is Seo 20 What Is Seo 21
Business2 days ago

What Is Seo

Search engine optimization, also known as SEO, is the process of increasing the quantity and quality of site traffic from...

How Much Rent Can I Afford. 22 How Much Rent Can I Afford. 23
Business2 days ago

How Much Rent Can I Afford.

How much rent is too much to pay? Sometimes, apartment complexes look at an annual income that’s over forty times...

Newsletters with Secrets & Analysis. Subscribe Now