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Gael Itier – CEO & Founder at Akt


What will the world look like once the pandemic is over? At present, no one can be sure given the rapid pace of change experienced over the past year. However, there are signs to suggest that our social and economic structures are shifting, and what is certain is that the world will undoubtedly appear very differently than it did pre-COVID.

For example – the five-day working week – a staple of modern society – now appears to be under threat due to advancements in workplace technology and an enforced successful period of working from home.

Instances of such change are happening across the entire breadth of society, and the world of financial services hasn’t escaped this. Over the past few years, Europe’s fintech sector has boomed as entrepreneurs have worked to provide an alternative to the traditional banking system. Generally smaller and more agile than the incumbents, fintech companies have been able to create services that mesh better with a hectic modern lifestyle. However, given the changes that are likely to result from COVID-19, will we soon see consumers switch at an even greater rate?


The changes brought forth by COVID-19

The financial sector was already undergoing significant change before the pandemic. Regulatory evolution and advancements in technology had already brought forward measures such as open banking, and as previously mentioned, changing customer demand had led to increased competition and a number of new entrants to the marketplace.

Gael Itier

COVID-19 has acted as a catalyst, rapidly intensifying the pace of some of these changes. For example, from the perspective of financial institutions, many found themselves having to promptly shift to a model of working from home after having been previously pessimistic to its benefits. This effected the delivery of both front and back end services, as organisations needed to invest time and resources into adapting to the new normal.

The move toward home-work also changed the outlook of the consumer. Now spending less time in busy town centres, the average consumer will spend more time managing their finances using digital and mobile channels, rather than traditional in person services. Furthermore, with the global employment market on especially unsteady ground, many consumers are looking for flexibility in the services that they use to able to adapt to any unforeseen change.


Why the fintech sector has been perfectly placed to take advantage

Whereas traditional banks needed to drastically adapt their ways of work to not being in the office, for many new fintech companies this was already the standard. As such, some customers of traditional banks will have found themselves receiving comparatively worse service than they did pre-pandemic. Many customers will have managed their finances in traditional brick and mortar locations. As such, with consumers having to rapidly shift to using websites, mobile apps, or over the phone – a number of the incumbents may not have had the necessary capacity in these services to deal with the increased demand, and this will have resulted in bottlenecks. Newer fintech’s will often have no physical presence at all, instead having built up their services with digital outlets in mind. As such, they were perfectly placed to adapt to this shift.

A similar pattern will be witnessed should a customer or business try to open a new account or access additional finance. Traditionally, this will require the applicant to produce physical documents to verify their identification, and their credibility as a borrower. With brick and mortar locations either remaining closed or operating at a severely reduced capacity, this inhibits the ability of many traditional banks to process these new applications, again resulting in a backlog. Some fintech’s meanwhile have used technology which allows for this process to be done digitally, utilising automation to ensure that the process is smoother.

Many consumers – having been forced to employ technology to manage their finances – will have also been impressed with the greater convenience, and will seek to switch to using digital forms more permanently. This means that what they look for from their financial service provider may change. For example, this shift will see aspects such as the app user experience, digital account opening, and remote claims become more important in determining what service to use. While the traditional banks can and do provide these services, in many cases they are hindered by having to build on top of legacy software, and a lack of expertise when compared to newer fintech’s, many of whom will have been established with these features in mind. This will mean that they’ll be well placed to take advantage of the newer consumer demands due to the higher quality of their features provided.


Making money go further

The average consumer will now be seeking ways to make their money go further. With the global economic outlook looking precarious to say the least, most people will look to sure up their finances. This is as the pandemic has made many people realise that it isn’t viable to live paycheck to paycheck, and has shown the importance of having a financial backup plan and the benefits of having another source of income, such as owning income producing assets. Even though more people are now looking to involve themselves in their finances and investing, the barrier to entry is still very high for those starting out as investors when it comes to accessing and effectively managing investments. As such, a banking platform which allows consumers to manage all their financial assets in a single place, utilising technology such as automation to grow the value of these assets will be very well placed to capture market share.

COVID-19 has already redressed the world in a fashion that was once unthinkable. We’ve seen mass upheaval to the way we live, work and spend our money, and the financial sector has had to scramble to meet expectations as society changes around it. This has led to the growth of a number of new companies who’ve risen to the challenge by offering greater flexibility and a better standard of service to consumers. While for now this appears to be the start of a revolution, only time will tell whether this will continue as we emerge from lockdown.



Cloud technology in banking: Why adoption is on the rise




Alpesh Tailor, Executive Director at digital transformation specialist GFT


The banking sector has never shied away from innovation, whether it is new products to improve customer savings habits or new ways of interacting with people and business, but embracing new technologies such as cloud has, until recently, been relatively slow. However, leading global financial institutions such as Goldman Sachs and Deutsche Bank have accelerated their adoption of cloud, which can provide insights for efficient technology transformation across the sector.

We conducted research to measure 21 medium-size and large banks’ sentiment and operations regarding cloud technology. Examining the relationship between cloud technology and banking professionals, our research provides an insight into the overall finance sector’s perception of cloud technology and how its application can improve banking procedures and efficiency.


Scale-up abilities

A significant trend showed that the way people use their finances and banking systems has changed, particularly when it comes to payments and transfers. Our research revealed that 86% of bankers have adopted cloud services to harness its virtually unlimited scalability, citing a definitive change in transaction behaviour as the main reason for moving to the cloud.

In the world of retail banking, buy-now-pay-later, open banking, and contactless payment systems have revolutionised the way people use their bank, making financial management easier and more efficient. However, despite these evolutions, high street banks are playing catch-up to the challenger banks who possess fewer legacy processes and, therefore, an easier migration to new technologies, such as the full utilisation of cloud and artificial intelligence.

The cloud provides a dependable, scalable, and flexible data system that allows traditional banks to modernise quickly and stay abreast of the innovations that ‘born-in-the-cloud’ challenger banks are bringing to the market. An increasingly popular way of doing this is by adopting a hybrid and multicloud approach.

Most organisations are considering diversifying their cloud technology, with 76% of bankers now agreeing with the importance of implementing multicloud systems in order to benefit from resilience and security improvements made by the main cloud providers. These cloud ‘hyperscalers’ also provide regular updates and continue to release exclusive new services and platforms as they continue to innovate.


Optimising costs

Our research indicates that cost optimisation is a primary reason that banks are looking toward the cloud for their future storage needs, with 81% of bankers confirming they have adopted cloud technology to save costs.

Installing and maintaining on-premise IT systems is lengthy and costly for financial institutions. When using the cloud, however, purchasing and installing hardware is no longer required as the cloud service provider hosts all the required infrastructure. The management of the hardware is included within this, reducing the overall cost of IT support further.


 Organisational inertia

Technological innovations are usually heralded for their ability to streamline operations, making them quicker and more secure. Our research illustrates that 62% of bankers believe organisational culture and inertia to be a key challenge within the sector. Besides being flexible for scalability and cost, adopting cloud technology can bolster organisational efficiency, since banks can spend fewer resources managing the relationship between trading volumes and payment infrastructure. Bankers acknowledge this opportunity, with 95% of organisations understanding that cloud technology can reduce time-to-market.


Overcoming misconceptions with cloud technology

Misconceptions usually exist around any emerging technology and our research found that this theme continues with cloud technology.

43% of the bankers we spoke to admitted that security concerns have impeded full cloud migration – a concern that has frequently been confirmed when speaking to financial services institutions. However, cloud providers invest heavily in the security of their cloud infrastructure which, as a result, makes it almost always safer than its on-premise, client-owned counterpart.

One aspect of adopting the cloud that continues to cause concern, is that which is commonly termed the ‘digital skills gap’. More than half of banks claim a lack of cloud-savvy employees internally has slowed down adoption. At GFT, we understand that this is a major issue for the adoption of cloud technology in all sectors, including banking, and have committed to training and encouraging young people to learn the required skills and enter the sector. We recently launched our Manchester Innovation Hub – a dedicated location to support the upskilling and growth of tech roles in the north.

Going forwards, cloud technology is the primary option for banks seeking to evolve and scale their business, whilst minimising risk, time and cost. Bankers recognise these benefits and the overall findings of our research suggest they will continue to grow their investment in cloud technology. Whilst evolving traditional legacy systems is very challenging, cloud technology continues to advance and we believe that over time it will become a powerful mainstay within the financial services industry.


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Bringing Automation to Banking




Ron Benegbi, Founder & CEO, Uplinq Financial Technologies


Automation is everywhere you look these days; from supermarkets to warehouses to automobiles. This prominent trend shows no sign of abating anytime soon. However, some sectors remain behind others when it comes to adopting automated technologies. Banking is one such segment, but there’s now evidence to suggest that this could be about to change.


What do we mean by automation?

There are a lot of ways to define automation, but broadly the term applies to any technological application where human input is minimized through design. Over the years, automation has evolved from a basic level, which took simple tasks and automated them, all the way to advanced automation powered by Artificial Intelligence (AI). In general, automated solutions work to increase productivity and efficiency within businesses and often result in a reduction in costs associated with human capital.


Ron Benegbi

Why has the banking sector been slow to adopt automation?

The banking sector has been built on a number of long-standing, tried and tested processes and protocols, which have been continually fortified and refined over time. This is one explanation as to why the sector has been so slow in adopting new, automated methods within its operations. Additionally, many major financial institutions have spent decades building their own internal legacy computer systems, which are often incompatible with modern automated solutions.

When combined, these two issues have caused a significant lag in the banking sector with regards to the adoption of automated technologies. This lag has created a market opportunity that a number of fintech providers have been able to exploit in recent years. Offering a more responsive and tech-first user experience, many fintech providers are leveraging the power of automation to better meet the banking needs of their customers. However, there is still time for the banking sector to start bridging this gap.


Does automation have a place in the banking sector?

The opportunity for automation to play a role within banking can be transformational.

To achieve this, it’s important that legacy organizations begin to learn from their more tech-savvy, smaller counterparts. If used effectively, automated financial solutions can greatly improve the experience of banking customers, both on a personal and business level. So, what exactly does this change look like, and how far away are we from seeing it become a reality?

A good place to start is the small business credit lending process, where not much has changed since the 1980’s. Over that period, the world has greatly transformed, but the methods used to assess credit worthiness have remained somewhat static. For the most part, banks assess data related to businesses’ accounting and banking records and from credit scores. For many businesses, especially the newer and less established ones, this antiquated approach is having a detrimental effect. In fact, it’s often cited as a contributor to the huge funding gap between SMBs and their larger counterparts.


How can automation benefit the banking sector?

By adopting more automated technologies, lenders in the banking sector can begin to assess more comprehensive information when making credit decisions. Notably, new methods exist, which enable additional data sets to be evaluated, in order to build a more accurate financial depiction of a business’ overall position. This data can come from sources like external market attributes, economic indicators, demographic data and exogenous shocks.

By leveraging additional data sets through new methods of financial automation, banks are now in a position to respond more effectively to small businesses, including those in emerging and evolving markets where there is a lack of conventional sources of information.

With more ways to access funding, facilitated by alternative data and automated processes, small business owners can improve their operational efficiencies and accelerate their growth efforts. In doing so, legacy oriented financial institutions can now better equip themselves in protecting against new, nimbler tech-based disruptors.


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