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What’s next for post-pandemic fintech innovation?

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What’s next for post-pandemic fintech innovation? 1

By Brannan Coady, CEO Netsells Group, CPO YourParkingSpace,

Even before 2020, FinTech was fundamentally transforming the way financial services operate. Established market players have been forced to step up their use of technology to keep pace with challenger banks and FinTech start-ups.

New market entrants are clearly following on of two strategies – they either aggregate existing services onto a unified digital platform, or break them down into niche digital products serving small, but well defined market segments.

This bundling and unbundling has become a familiar pattern of innovation across multiple industries ever since the .com boom.

However within the context of FinTech, there are unique ecosystem pressures that are driving new products and services. For anyone looking to work with or build a fintech business, these are the three trends I would take note of to drive my strategy in 2020:

Digital Transformation Will Be Non-Neogtiable

The abrupt move to digital during the first few months of 2020 came as the biggest shock to incumbents that relied heavily on outdated processes, multiple intermediaries and legacy systems.

For example, homebuyers in the UK at the beginning of the pandemic faced month long delays for mortgage approvals. This was blamed on the rise of homeworking, however delays also result from the fact that multiple parties interact with manual updates throughout the transaction lifecycle.

This is further exacerbated by the fact that risk appetites across the sector have been depressed, but assessing risk is still in many cases reliant on manual investigations by underwriters.

My feeling is that having had these issues exposed in such a painful manner, traditional banks will have a healthy, if not voracious, appetite for rapid technology implementation over the coming years. This matter will be even more pressing given the fact that most banks have several start-ups in their rear view mirror for each service in their portfolio.

We are already seeing a massive interest in the potential of Blockchain to streamline the home buying process, as well as the way financial institutions handle mortgages. If data can be held by multiple parties that is trusted, accurate and secure, process steps can be automated and reduce the complexity, time and cost for all parties.

I’m also very excited about the potential of AI to increase speed and further reduce risk through document analysis and intelligent decision making. It would be a shock if we do not see mass-adoption of multiple emerging technologies over the next few years.

Regulation Will Become a Driver of Innovation

As competition and innovation heats up, regulators will have to become part of the driving force behind new services and products.

There are two sides of the coin at play here, as of course regulators are in place to stop abuse or misuse, but they also have to become conscious of the potential for regulation to impede progress.

Brannan Coady

Brannan Coady

As new technologies are introduced, there is a clear opportunity to rethink how regulatory frameworks might actually support the development of new propositions by offering clear guidance to those looking to build in the FinTech space.

An example of this is the Payment Services Directive (PSD), which aims to encourage innovation in the payments industry and outlines the criteria and obligations for payment providers and users.

PSD2, in particular, forces providers to open up their data and services to third-parties which has been transformational for FinTechs and traditional banks alike, allowing for better customer outcomes and more streamlined internal processes.

The next phase of post-pandemic fintech innovation will require regulators to instill confidence in both consumers and those creating solutions.

Digital Payments Will Continue To Dominate

Despite its boring image, payments remains one of the hottest areas of fintech investment, with €55.6bn worth of exits since 2013.

Digital wallet services such as Apple Pay and Google Pay leverage well understood technologies such as near-field communication (NFC) technology and biometric authentication to make the consumer payments experience seamless and secure.

However there is more still to come from consumer-facing solutions, especially as the demand for mobile payments have skyrocketed dramatically over the last 6 months and shows no sign of slowing down.

We are starting to see solutions emerge that do away with card machines and hardware altogether, facilitating purely mobile to mobile transactions enabled by a mobile application installed on retailers’ and consumers’ devices.

Alongside consumer-facing propositions, we are also seeing an expanding desire for the payments ecosystem itself to be productised and opened up.

API-driven, banking-as-a-service platforms are using the opportunities provided by regulations such as PSD2 to enable payments by directly connecting the merchant and the bank, reducing the number of intermediaries and therefore costs.

This openness is also providing opportunities for collaboration between banks and fintechs and actually provides a new type of opportunity for incumbents with a large existing customer base. Banks now have the ability to become true platforms, bundling up and connecting services provided by a multitude of fintechs

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Leading from the front – why decision makers must embrace automation

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Leading from the front - why decision makers must embrace automation 2

By Jeppe Rindom, Co-founder & CEO, Pleo

Ask any decision maker at a business about admin and you’re likely to be met with a familiar response – it’s a necessary evil that swallows time, but also helps inform strategic choices. Informed decisions are always better than uninformed ones, but many businesses still rely on outdated legacy processes to gather the data they need to make critical choices… and we’ve all seen the perils of a poorly maintained Excel spreadsheet in the news recently.

At director level, these administrative tasks can consist of signing off expenses or monitoring company spending to inform upcoming budgets. Although crucial to running a business well, these can be time-consuming and frustrating when you don’t have the right tools to make sense of it all. The solution? A simple change of approach.

A logical solution

This is where automation comes in. Over the last decade, we’ve seen how technologies including chat-bots and artificial intelligence have impacted everyday business, from customer-services and marketing to data analytics and time-management. More than ever, this is allowing employees to free  up time to work more efficiently and focus on business-critical tasks. But this isn’t a quick fix. At a decision making is required. Ironically, a lot of these tasks relate to how a business can improve efficiency and productivity.

Add in the fact that many of these senior staff members have tight schedules, and can’t afford to spend several hours trawling through spreadsheets, and it’s little wonder high level admin is still an issue. In a recent customer survey, we found that 75% of senior managers spend over an hour a week on expense reports, with 14% losing nearly a whole working day (five hours or more) a week to managing them – time that could be better spent growing their business. The same study found that our platform saves people an average of 11.5 hours a month on managing company expenses. If you consider this could mean an extra day for a CFO or Finance Director to spend on more essential tasks, such as business forecasting or growth planning, the reward for investing in well designed automation at this level is clear.

Building trust

Jeppe Rindom

Jeppe Rindom

But, automation isn’t just a case of saving time; it also fosters trust. Our study found that over half (51%) of users agreed that automating the laborious parts of their expenses like receipt capture, categorisation and expense reports also helped them build trust within their organisation. Automation helped them to excel at the things they’re most interested in, and were actually hired to do. I’m a huge advocate of empowering people with the tools they need to succeed. And through the empowerment automation brings, it’s only natural that employees begin to feel their worth in the business and that they are trusted.

A business-wide approach

Yet for automation to work, a company-wide understanding of its potential is vital. Adoption by senior staff should not be seen as simply a fringe benefit, as automation relies on understanding and endorsement from all levels of a business to work efficiently. A report titled ‘Automation and the future of work,’ published by the British Government in September 2019 noted that the successful implementation of automation “relies on managers and business leaders themselves being able to understand the potential of automation and the impact of technological change.” In this respect, managers will be your biggest ally when embracing automation. Any manager worth their salt understands the benefits of leading through example, and by creating automation ‘advocates’, businesses can ensure teams are comfortable with the impending change. While many busy managers often resist new processes (especially those to do with unfamiliar technology), they usually find that investing a short amount of time getting to grips with an automation platform pays off in the long term.

One of the most frequent pieces of feedback we receive is that an effectively automated platform allows staff to focus on strategy, culture and creativity, with the knock-on effect of automating mundane tasks being felt throughout an entire organisation, not just one relieved individual.

Having a smart, automated platform can also massively reduce the chance of human error at an early stage. This can be disastrous when data is relied upon to make important decisions at a later date. In this respect, having access to accurate information can be a game-changing benefit for decision-makers, particularly those working under increased pressure.

At a time when businesses are facing rapid and unpredictable changes, ensuring your business is equipped with the right tools for success is crucial. And while automation may seem an intimidating change, the huge benefits it can bring to both processes and culture will outweigh any initial concerns. By giving senior staff and their team members alike the ability to embrace smart automation, efficiency will speak for itself, and your business’ success will flourish.

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How robotic technology will disrupt the manufacturing industry

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How robotic technology will disrupt the manufacturing industry 3

By Marga Hoek, author of The Trillion Dollar Shift

Robotics technology has the potential to disrupt industries across all sectors – but its impact on the manufacturing industry will be transformative. Not only can robots increase productivity, efficiency and profit margins but adopting this tech for good will be a key way for the manufacturing industry to transition to a more sustainable future.

Driving productivity & efficiency

Manufacturing processes are faster, more efficient, and more cost-effective when humans and robots work together. Studies show that idle time is reduced by 85% when people work collaboratively with a human-aware robot, rather than in an all-human team.[1] Modern robotic automation is key to reshaping production processes to become more efficient and reliable. They deliver significant benefits for companies and investment is often recouped within just 18 months.[2]

Robots in manufacturing can allow businesses to monitor the production lines from anywhere and pinpoint issues quickly, allowing for production to continue smoothly and efficiently, ensuring companies surpass consumers’ expectations of supply chain speed and reliability. Intelligent industrial service robots are an upcoming industrial tool that will amplify manufacturing capabilities and allow businesses to safely operate faster, in places humans could never go, and with cognitive and physical capabilities not yet imagined.

Transitioning to a sustainable future

Robots are a vital way to reduce pollution and emissions from manufacturing operations. For starters, they reduce our reliance on larger vehicles and machines that are harmful to the planet. Robots’ ability to be extremely accurate and minimize errors is also hugely important in sustainability efforts to reduce waste. Robots also aid businesses in their energy-saving process because they do not require as much energy to operate as humans do. Where humans need facilities with sufficient lighting and heat, robots can work under cold and dark conditions. This drastically reduces the amount of energy used in the manufacturing production process. It is estimated that for every 1C reduced in factory heat levels, there is a potential saving of up to 8%.[3] In addition, up to 20% of energy savings can be reached if the plant turns off any unnecessary lighting.

Case Study: GE

Tech giant GE is a brilliant example of how robotics technology can both boost the bottom line and sustainability.

GE is at the forefront of robotics manufacturing technology. Their value proposition is tightly tied to productivity in field service and manufacturing and offers potential cost savings within operations. While delivering industrial-grade service robotic systems that enable automation, productivity and safety for GE and its customers, the company works closely with GE business units, GE customers and strategic partners across the globe to envision, shape and build intelligent robotic technologies from idea to commercialization.

Marga Hoek

Marga Hoek

GE’s recent $125 million investment project at its Decatur refrigerator plant boosted production capacity, added new “smart” technology and increased the site’s workforce.  This includes auto guided vehicles, or AGVs, that move materials through the assembly process and more than 50 robots that perform heavy lifting operations and repetitive tasks.

The expansion project, announced in June 2018, allowed GE Appliances to increase production to meet growing demand for its freezer-refrigerators, which are top-rated in the industry for both quality and reliability. The expansion created 255 jobs, bringing total employment at the plant to 1,300. The project boosts production capacity by 25 % and ensures early compliance with 2022 refrigerant changes, making the Alabama plant a super site for GE. GE Appliances said Industry 4.0 technology additions at the Decatur facility include data visualization, 3-D scanning, rapid prototyping and other smart automation that provides the operations team with real-time data to make better and faster decisions.

Achieving the UN’s Sustainable Development Goals

Utilizing robotics technology within the manufacturing industry can help to meet the UN’s 17 Sustainable Development Goals (SDG) for a healthier planet, to be met by 2030:

SDG 3 – Good Health & Wellbeing: Collaborating with people, service robots work with shoulder-to-shoulder and over long distances, to fulfil dull, dirty and dangerous work.

SDG 8 – Decent Work & Economic Growth: Presenting new growth opportunities for businesses and creating new jobs at manufacturing plants

SDG 9 – Industry, Innovation & Infrastructure:  Manufacturing value proposition of robotics ties tightly to productivity and brings potential cost savings into those operations.

SDG 12 – Responsible Production & Consumption: Providing a new and rich data source for companies to produce products responsibly

Marga Hoek is a global thought-leader on sustainable business, international speaker and the author of The Trillion Dollar Shift, a new book revealing the business opportunities provided by the UN’s Sustainable Development Goals. The Trillion Dollar Shift is published by Routledge, in hardback and e-book. For more information go to www.margahoek.com

[1] https://www.weforum.org/agenda/2020/08/here-s-how-robots-can-help-us-confront-covid/

[2] https://www.industrialtechnology.co.uk/products–transforming-your-sustainability-with-robotic-automation.html

[3] https://greencleanguide.com/how-robotics-is-revolutionizing-sustainability/

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RPA, the software robots that finance and banking professionals need to hear about.

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RPA, the software robots that finance and banking professionals need to hear about. 4

By Rory Gray, Vice President of Sales at leading software automation firm, UiPath, explains what role Robotic Process Automation (RPA) can play in improving the efficiency of finance and banking departments.

Pre-coronavirus, the finance and banking industries were already facing a myriad of challenges. Now, this myriad is quickly becoming ever more complicated. There is increasing pressure to react to declining business health, be flexible to changing customer behaviour and to adapt to evolving workforce dynamics.

Unfortunately, for these teams, improving agility is easier said than done. Many processes involve legacy systems, paper-based documents and unstructured data. These processes are time-consuming and mundane, leaving finance and banking professionals hard-pressed to fit in client-centric and strategic work.

Take processing invoices. The way it’s done hasn’t changed for years in many organisations. It often involves a member or members of the finance team receiving the invoice by mail or email, approving it manually, printing, signing and submitting it to Accounts Payable. An AP Clerk then has to pick it up, read it, verify the approvals, extract the data and input it into to the accounting package. This all takes time and costs money. What’s more, it’s dull and prone to errors. People don’t want to spend their days doing it.

Imagine if processes such as invoicing, but also loan processing, credit card disputes and many more, could be automated. Finance and banking teams would spend much less time copying, pasting and printing and could refocus on business health and transformation.

RPA is the key to finding more time in the day  

Robotic Process Automation or RPA, is software that can work just like a human. It can use AI capabilities to read and interpret data from both physical and digital documents. It can extract the necessary information and it can transfer this to multiple IT applications. It’s a software robot – or digital assistant.

For finance and banking professionals, RPA could help them break free from the time constraints caused by inefficient and complex legacy operations by passing rule-based repetitive tasks to software robots. This saves time and money – and allows people to focus on the tasks that can make a difference to the business.

RPA can help carry the burden of compliance

Rory Gray

Rory Gray

With data extracted, processed and formatted by software robots, employees will also no longer have to carry the full and heavy burden of compliance.

However accurate we aim to be, the reality is that processing data is always open to mistakes. This is exacerbated by ever shifting market regulations. Software robots, however, are programmed by finance and banking professionals to strictly follow the same steps every time and thus do not fall victim to the same blunders as all humans inevitably do.

Of course, many regulatory compliance functions will often need to involve some human validation or decision making. While the robots work around the clock without fatigue to complete tasks, professionals can still intervene if there is an inaccuracy that requires the personal touch or a loop in the workflow where a decision is needed. Therefore, time-consuming compliance tasks can be passed to software robots, but humans ultimately remain in control.

This in turn provides better risk management and compliance, higher accuracy, better cycle times and improved throughput.

RPA in practice

This may all sound very futuristic, but in practice, many firms are already using RPA to free up employee time, improve compliance and save money.

For example, a leading smart infrastructure solutions firm we work with has created a software robot affectionately named Archie, which has taken over the responsibility for processing all invoices.

Pre-Covid, the 400,000 invoices received by the firm each year were dealt with manually. With Archie this is now fully automated freeing up on average 11 minutes per invoice of time which employees can now use to focus on value-adding activities. It also means that no employee needs to come into the office to process the invoice, nor does any paper need to be passed around the team. Thus helping to keep the workforce safe.

With all this extra time, finance and banking departments can focus on adapting to and thriving in the current crisis. Moving away from data processing and towards advisory roles where they can best use their strategic skills.

Consequently, businesses will benefit during the pandemic and beyond and employees could see their roles shifting away from the mundane and towards tasks that keep them on their toes. A rare win-win in a difficult time.

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