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Breaking down the barriers to digital equity and financial inclusion

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By Vijay Guntur, President, ERS at HCL Technologies

The world is moving in a clear trajectory towards a digital future. Organisations are prioritising digital transformation, and governments are embracing digital technologies to create smart, sustainable cities. Early iterations of the metaverse – an immersive and universal virtual world – also point to a scenario where many physical interactions and transactions could take place in a digital environment. It is therefore essential that digital equity is built into the foundation of this digital era. 

 

What is digital equity? 

The concept of digital equity ensures everyone has the same access to digital technologies and the opportunities that they can create. Yet, when it comes to putting this into practice, digital equity is hard to define and action. However, it can be measured in three broad areas: age group, gender and income level. Understanding these areas can help public and private sector organisations improve access to digital. 

For example, older demographics don’t generally have access to digital technology, while younger age groups are widely enabled. From a gender perspective, access to digital technologies differs between men and women.  When it comes to income levels, this remains the biggest barrier to digital equity. Those from the lowest income households often have the least access to digital technology, whereas higher income households have more opportunities through access to platforms, such as Uber or Airbnb.

Income levels will continue play a big role in how digital equity will become available. To change the current landscape, the public and private sectors need to do a lot more to break down income level barriers 

Facilitating digital equity in the public and private sectors 

One of the main barriers to digital equity is digital infrastructure (i.e. the foundational service of a country or organisation’s digital technology capabilities). This includes the smartphone penetration ecosystem, access to broadband and availability of hardware, such as laptops and tablet devices. 

For example, if you look at cities in India, the level of digital access is approximately 45%, but in rural areas this falls to 15%. To combat the issue of broadband access, the Indian government has set up the MyBharatNet initiative, connecting rural villages with broadband access. There are numerous initiatives in other countries, aimed at making broadband access more readily available in rural areas. Private enterprise can also help here, providing mobile devices at lower price points, meaning that more people can get access to them, and gain mobile internet access. 

The second barrier is digital education and this is an area where private enterprises can have a significant impact.  At HCL, our TechBee programme helps people in India – both men and women – who have just finished their school education by providing them with a digital skills base, in order to continue their learning. This type of initiative is growing in popularity and demonstrates how through supporting digital education, organisations can improve digital literacy and equity

Digital equity in action

It’s clear that the pace of digital change shows no sign of slowing down, so we must act now. For instance, the Covid-19 pandemic accelerated eLearning and telehealth around the world. This transition to virtual environments in the education and healthcare sectors now means that those without access to digital are at risk of being neglected by these essential services. 

A digitally equal society will create greater access to education and healthcare, which are now increasingly in a digital setting. This will contribute to an increase in income levels for generations, which in turn, will create a cycle of accessibility and equitability.

We are moving in the right direction when it comes to digital equity and there are numerous examples of it in action, particularly when it comes to financial inclusion: 

In India, the Aadhaar initiative provides people with a 12-digit identification number so they can create a digital identity and have access to banking services.  While the Unified Payments Interface supports frictionless payments, by bringing multiple bank accounts, seamless fund routing and merchant payments into a single mobile application (of any participating bank).  Access to microfinancing options brings down the cost of capital significantly for people at the bottom of the pyramid which in turn can accelerate their income generation.

This, along with ecommerce platforms, like Amazon and FlipKart, is creating a level playing field and providing market access to artisans, handicraft, self-help groups and others. While aggregator platforms, like Urban Company, are improving the regularity and consistency of jobs for blue-collar workers. 

Ultimately, driving financial inclusion through initiatives and platforms like these creates opportunities for all citizens, and will be a big part of creating a digitally equitable society both now and in the future.

 

Business

How FS organisations can utilise data to boost customer experience

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Charles Southwood, Regional VP and GM – Northern Europe and Africa at Denodo

We’ve all heard the age-old adage “the customer is always right”. It insinuates that, in any sector, the needs and desires of those buying a brand’s product or services should be paramount. However, today’s customer has new standards and it is becoming harder than ever for businesses to meet and exceed them.

This is certainly the case in the financial services (FS) sector where getting customer experience right used to be relatively simple. The human touch was traditionally delivered as a bi-product of in-store, transactional interactions. Perhaps, as a result of this, few people ever considered changing their provider and the traditional, established banks ruled the space.

However, with the dawn of online banking and the introduction of new, exciting challenger banks as well as the UK’s unique Current Account Switching Service, the balance of power between the consumer and the bank is changing. Consumers no longer feel locked in. If their needs aren’t being met, they aren’t afraid to look elsewhere and switch their allegiance to other companies. In other words, loyalty is far from guaranteed and customer acquisition is only half the battle.

Retention relies upon delivering strong, unique customer experiences that beat down the competition. In order to achieve this, FS organisations will need to be able to leverage data. Its insights could be the differentiator that enables them to stand out. The positive news is that, in our online world, there is a constant stream of data being produced. However, having access to all this data doesn’t necessarily mean that a brand knows how to effectively analyse and utilise it.

Ensuring data provides insight

The rapid growth in digital technologies and services across the sector has left many FS organisations juggling an unimaginable amount of data. This data is both complex and much of it is lacking in quality. Structured, semi-structured and unstructured, it is stored in many different places – whether that’s in data lakes, on premise or in multi-cloud environments. Before FS organisations can even think about using it to inform customer experience strategies, they need to be able to find it and understand it.

This is where modern technologies – such as data virtualization – can help. Through a single, logical view data virtualization boosts visibility and real-time availability of all data across an organisation.  Unlike traditional extract, transform and load (ETL) solutions, it does not move and copy data. Instead it leaves it in the source systems. In other words, instead of just replicating data, data virtualization reveals an integrated view to those trying to find it.

For FS organisations this provides several important benefits. For example, it helps when data sovereignty issues arise and the movement and replication of data outside certain countries is illegal. Data virtualization solutions can also assist in terms of financial reporting by fetching data in real time from underlying source systems – applying the necessary security and obfuscation whilst delivering the performance, the agility and the accuracy needed through the seamless connection of data.

FS organisations that adopt data virtualization, are likely to see an improvement in the overall performance and efficiencies of their business operations. Overheads will be reduced, as will the length of project times. Above all, data virtualization will rapidly strengthen the customer experience by supporting business leaders to think strategically and make decisions based on real-time insights. But don’t just take my word for it.

The proof is in the pudding: How Landsbankinn is delivering on the CX promise

Landsbankinn is just one of the many financial services institutions that has already successfully embraced data virtualization and its benefits. Despite being the largest financial institution in Iceland – with around 40% of the retail and 33% of the corporate banking market share – Landsbankinn used to face several issues when it came to data sharing and analytics.

Over 45 siloed data sources – including Oracle databases, data warehouses and APIs from internal and external sources – made finding and accessing the right data at the right time extremely difficult. Without real-time data to fuel informed decision making, customer experience and operational efficiency were suffering. As a result, Landsbankinn was in need of a data overhaul to streamline and integrate its infrastructure.

To bring together its complex data landscape and collect data in real-time, Landsbankinn implemented the Denodo Platform – a data integration and data management solution built on data virtualization – to build a logical data warehouse. As a result, the team can now aggregate data from multiple data sources, transform that data based on the applied business rules, and then make it available to consuming applications. Ultimately, this means that, throughout the organisation, the data can be utilised by a wealth of employees, even those who are not particularly IT savvy. It also means that the business leaders can use data insights to make well-versed decisions and provide a plethora of services to Landsbankinn customers both quickly and efficiently.

In recent years, customer retention has become the key to successfully growing a business. This cannot happen without an effective customer experience strategy. The ability to convert data into insight is priceless in an economic landscape where the line between a business thriving, surviving and failing is so thin. Those operating in financial services must harness modern technologies – like data virtualization – to stay at the top of their game and ahead of the competition.

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Banking

The Importance of Digital Trust in Banking and Finance

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By Maeson Maherry, COO at Ascertia

 

With the rising adoption of eSignatures and the acceleration of digital transformation, trust in digital systems is more important than ever before. As a recession looms, the ability to trust digital systems is critical to the stability and security of the banking and finance industry.

So, what should businesses prioritise in an increasingly online world? Information security, data integrity, and digital trust are crucial for ensuring regulatory compliance and customer satisfaction.

Digital trust is empowering banking and finance institutions to effectively tackle issues of identity theft and fraud.

What is digital trust?

On the surface, digital trust refers to a digital system or platform that is secure and can be relied upon to protect and properly handle sensitive information.

Building the confidence that people have in digital systems, platforms, and technologies to handle their sensitive information, protect them from fraud, and function as intended is paramount for decision-makers going forward.

Trust online encompasses various aspects, such as data security, privacy, authenticity and reliability. Digital trust also involves assessing the trustworthiness of digital entities such as websites, apps, and online services, as well as the trust in the integrity and reliability of digital communications and transactions.

Maeson Maherry

Digital trust is a key element of digital transformation, the additional step to ensuring the digital systems in place are secure. This can include the following:

  • Online banking platform for customers
  • Digital document approvals and workflows
  • Secure digital signature solutions
  • Know your customer (KYC) checks
  • Electronic anti-money laundering procedures

Why is digital trust important for banks?

One of the main reasons why digital trust is so important in banking and finance is that it helps to tackle issues of identity theft and fraud. Customers and regulators require reassurance that personal and financial data won’t fall into the wrong hands. This includes customer statements, investment authorisations, legal records and customer personal data.

Online banking is now well established but the technology continues to evolve and so do the potential threats to data security. With phishing and other identity theft a daily concern, establishing digital trust in the industry is key.

Digital trust provides a means to trust in the identity of a person or document online, to the same degree as meeting or signing in person. This requires additional checks and layers of security to verify identities and the security of documents.

The role of eSignatures in banking

Digital trust is vital in the secure implementation of eSignatures.

In the banking and finance industry, eSignatures are becoming increasingly popular as they allow for transactions to be conducted quickly and securely. However, for eSignatures to be effective and to provide digital trust, all parties involved must trust in the transaction. This is done by ensuring eSignatures are valid and that the person signing the document is who they claim to be.

There are global standards to ensure the authenticity of eSignatures for digital signing. This means there is a way to validate the digital trustworthiness of eSignatures if implemented and used in a manner that meets certain criteria for security and authenticity.

For instance, digital signatures that are compliant with internationally recognised standards, such as eIDAS (Electronic Identification and Trust Services) in Europe, can be considered digitally trustworthy. It’s important to understand not all eSignatures provide the same level of security and to ensure the correct eSignature is used for the purpose and security required.

eSignatures that use advanced digital signature technologies such as Public Key Infrastructure (PKI) or biometrics, can be considered more digitally trustworthy as they provide a higher level of security and authentication.

These technologies use cryptographic methods to ensure that the signature is unique to the signer and cannot be replicated or forged. These standards establish a legal framework for the use of electronic signatures and ensure that they are legally binding, enforceable and offer the same level of trust as traditional signatures.

How does digital trust prevent fraud?

If the public loses trust in digital systems, it could lead to a loss of confidence in the financial system. Fraud, in particular, is at the forefront of public concerns.

Digital signatures are well positioned to offset the risk of financial fraud, largely due to three critical factors when assessing the digital trust of an eSignature:

  • Authentication: To verify the identity of the signer, eSignatures employ sophisticated technologies such as PKI. This confirms that the person signing the document is who they say they are and aids in preventing fraud through impersonation.
  • Tamper-evident: Tamper-evident features are often included in high-trust eSignatures, which identify if a document has been changed after it has been signed. This helps to prevent fraud by identifying manipulated papers and giving an audit trail of the signature.
  • Compliance: International standards such as eIDAS ensure that eSignatures are legally binding, enforceable, and provide the same level of trust as traditional signatures.

The banking industry specifically will benefit greatly from investing in digital trust ecosystems that include eSignatures, biometrics and encryption software to provide verification and assurance for customers.

In the future, financial institutions will adopt Know Your Transaction (KYT) as a means of implementing cybersecurity measures at the transaction level in their banking protocols.

By utilizing digital signatures at the transaction level and verifying them upon receipt, the financial industry can achieve KYT, ensuring that the source of information is under the control of the endpoint and that transaction information has not been tampered with.

This level of security will be a crucial aspect of achieving digital trust in the financial industry moving forward.

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