Business
How scaling agility can help mortgage lenders thrive in a tough economy
Published
8 months agoon
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By Angus Panton, Director of Banking and Financial Services at Expleo
During periods of economic uncertainty, speed and agility plays a major role in a mortgage lender’s ability to stay ahead of the game. In fact, I would go so far as to say that agility, or the ability to scale agility, is essential to minimising risk, maintaining the customer experience and driving a competitive advantage. But just how can agility help? And what are the steps that organisations can take today to put them in a stronger position tomorrow?
The benefits of scaling agility for mortgage lenders
As we face into the volatile market, I find I’m asked more and more about the benefits of being able to scale agility. For me, adopting agile processes and ways of working provides clear benefits that support both business operations and performance. By putting disruptive tech at the heart of the business strategy, lenders stand to boost productivity, build stronger in-house skills and modernise their operation with targeted investment in systems, data, testing, cybersecurity, hyperautomation and quality assurance.
But scaling agility isn’t just a survival tactic, I believe it is essential to sustained business growth too. Organisation that can switch-on or ramp-up agility when and where it’s most needed will be the ones who adapt best to the demands of the market, seizing opportunity before the playing field becomes too crowded.
Unlocking agility
Learning from what works (and what doesn’t) in Fintech is a great starting point for heritage lenders looking to scale agility. Fintechs enter the market with a technology-first model that’s baked-in from day one, they can ‘build or buy’ their way to agility much more quickly than a heritage bank with legacy systems and processes. By partnering with a Fintech or consultancy to better understand agility in action, traditional lenders can quickly adapt existing plans to take advantage of the insight afforded.

Angus Panton
And although it’s possible to learn from Fintech, there is no such thing as a one-size-fits-all, each lender’s roadmap to scaling agility will differ, depending on any number of variables from the size of the organisation to its maturity.
In certain organisations, a foundational level of agility is already in place, but is stifled by red tape or siloed mindsets. The key here is to pinpoint the specific blockers, so that the organisation can identify what is preventing agility from being released in the first place.
The end goal however remains consistent – to deliver long-term roadmaps that unlock agility with streamlined processes, consolidated reporting, increased end-to-end quality assurance and enhancements to the customer experience.
There are five key factors to consider when unlocking agilty:
- Define your business goals: By interrogating a granular understand of what the company wants to achieve, you can set business goals that will meet the specific needs of your agility challenge
- Embrace ambiguity: Although none of us can predict the future, spending time considering the ‘what ifs’ can help organisations to embrace ambiguity and build this in to their vision
- Data-driven decision making: a non-negotiable when it comes to scaling agility is data-driven decision making. Businesses that invest in building out their data insights capability will be the ones to stay ahead of the competition and remain closest to their customers
- Use the experts: establishing a culture of agility can be hard at first, so gather up some expertise to help you make it as efficient and as smooth as possible.
Adaptable strategy: a strategy that allows improvements to be captured and applied will foster a culture of continuous improvement
Product, price and agility
In a market where interest rates are highly volatile, consumers are naturally focused on getting the best possible deal and product features when it’s time to refinance their mortgage. This combined with a growing preference for researching and buying financial products online, means consumers expect to be able to access up to the minute pricing and products, packaged up as part of a great online, customer experience. In the current climate, it will be lenders that fast-track agility to put customer-centric product strategies in place that gain the most. For example, using hyperautomation to manage mortgage product updates, harnessing AI for customer communications or blockchain for smart-contracts to offer heightened information security.
Agility, always.
No-one knows what the future holds or how economic, political or social forces will shape the financial markets in 2023 and beyond. If 2022 taught us anything, it’s to be prepared – and in the banking sector preparation starts with scaling agility, so that lenders are primed and ready to respond at pace, rather than react in haste. It’s by doing this that lenders can minimise risk, grow their business and protect and improve the customer experience.
Banking
Building towards an inclusive financial future
Published
4 days agoon
September 22, 2023By
editorial
By Catharina Eklof, CCO of IDEX Biometrics
From the visually impaired to displaced migrants, the unbanked, and people living with dementia – a burgeoning financial gap exists across many areas of society. In fact, as of late 2021, almost one-third of adults around the world were reported as unbanked according to the World Bank Group. That’s around 1.7 billion people – with half coming from the poorest 40% of the world’s population. Being financially excluded in this way means not having access to common financial services including savings accounts, loans, a credit rating, or even a bank account. Those who are awaiting clearance to join a country’s financial ecosystem, such as migrants, are also finding themselves left behind by the modern financial infrastructure.
As societies reliance on digital and contactless transactions over cash continues to grow, this financial gap is only set to widen. In less than 10 years, the share of Americans not using cash for payments has increased by double digits, reaching 41%. By 2031, cash payments are expected to make up only 6% of all transactions.
Fortunately, biometric smart cards can bridge this gap for people in the Global South, migrant populations, as well as those with visual or cognitive disabilities worldwide, who deserve to feel secure, included, and independent.
The challenges surrounding passwords
COVID accelerated the transition from cash to contactless payments and the use of digital wallets, creating a challenge for many. By 2024, it is expected that digital wallets and cards will account for 84.5% of all e-commerce spend.
Digital transactions traditionally rely on the use of PINs that can easily be forgotten, as studies have found that we manage 100 passwords on average across various sites and services. In the US alone, consumers report relationships with more than three financial institutions and have more than four accounts per household. The challenge of password recollection is only growing. To counter rising cybersecurity threats, several countries now mandate two-factor authentication for retailers and service providers, creating further complexity.
However, organizations are responding to financial exclusion. Card provider Mastercard introduced its contactless PayPass offering, as well its Touch Card developed alongside Amjan Bank which enables the visually impaired to distinguish between their cards. Both look to provide a better customer experience for people struggling with the digital changeover. For those living with dementia, Mastercard has also partnered with Sibstar and the Alzheimer’s Society to create a specific card where limits, transactions, top-ups and notifications can be viewed and managed via a complementing app. Likewise, Turkish neo bank Papara introduced a Bluetooth debit card that provides visually impaired users with audio prompts when making payments.
Protecting the visually impaired
There are at least 2.2 billion visually impaired people globally. In 2019, it was found that 89% of visually impaired have been victims of fraud or have made errors when paying for goods and services. This figure comes prior to the pandemic, and the proliferation of digital transactions, suggesting an even bigger concern today.
PINs present an obvious security issue for this demographic, with others able to oversee their inputs and then manipulate them. Contactless payments go some way to solving that problem but pose the risk of fraud as there is no PIN verification below the increasing threshold amount, now at £100 in the UK, where the average annual wage is £27,756. In India, where the average annual wage is 9,45,489 rupees (roughly £9000), contactless limits are set to 5000 rupees (£48). Many accounts also require visual-based inputs to prove identity, such as CAPTCHA, proving as a barrier for the visually impaired.
Enhancing awareness on a regulatory level is key for driving change and reassuring vulnerable groups. The EU Accessibility Act is an example of how payment service providers are obliged to comply with accessibility standards. This includes making interfaces perceivable, operable, understandable, and robust, to ensure that individuals with disabilities can effectively navigate payment interfaces.
Paving the way with biometrics
Including braille on cards for easy identification is a crucial step for the visually impaired. This can also be used on biometrics smart cards, with sensor textures to confirm the user has selected the correct method of transacting. Not only do these cards provide convenience and inclusivity, but they also promote ultimate security by linking a person’s identity directly to their fingerprints. This data is encrypted within the card itself, reducing any concerns surrounding fraudulent behaviour or of data being lost via a centralized breach or large-scale hack.
In this context, biometrics can be used to serve the unbanked and those currently unrecognized within national infrastructures. South America is an example of an early adopter of biometrics, turning to the solution to cope with swelling population sizes, and the challenges associated with accessing proof of identity when setting up traditional bank accounts. Meanwhile in India, pension payment fraud has dropped by 47% thanks to bypassing the need for prior credit ratings or credentials.
Liveness detection, however, which ensures the biometric sensor is reading a true biometric source (rather than a false or recreated image of one), is vital to the success of financial aid programs globally. Securing remittances through biometric authentication ensures transparency and better fund control. Directing funds to cold wallets or biometrically authenticated cards can also improve program efficiency, safeguarding the interests of individuals and communities.
Overall, the biometrics market is expected to grow to US$87.4 billion by 2028, at a CAGR of 17%. Whilst its value as a simple and secure method of transacting is growing substantially, you can’t put a price on its impact on those who have so-far fallen through the gaps of finance’s digital revolution.
Business
Euro deep tech M&A deal value expected to reach $20bn+ in the next 15 months
Published
4 days agoon
September 22, 2023By
editorial
Written by Oliver Warren, Associate at DAI Magister
Investment in European deep tech has mirrored the broader decline in the technology sector; it has halved since the peak of 2021’s boom, reflecting investor preferences for ventures with lower capital expenditures and associated risks. Start-ups within the following verticals: Health and Bio, Transportation, Energy, and SaaS and AI experienced the most significant drops.
However, Dealroom data shows stark differences in funding for deep tech start-ups at the early, breakout (Series B & C), and late stages. After experiencing a modest deceleration between 2021 and 2022, early-stage deep-tech fundraisings have been surprisingly healthy, bucking the market trend, due in part to the hype surrounding Generative-AI and in Q1 2023 they received the highest infusion of capital for over a year.
However, this positive trend conceals a sharp decline in B and C round fundraises, which have seen investment activity plummet to $1 billion in Q1 2023 from a peak of $3 billion in Q1 2022. Late-stage rounds (>$100M) have also experienced massive declines, falling almost 70% from $2 billion in Q1 2022 to $634 million in Q1 2023.
$20bn+ worth of deep tech M&A in the next 15 months alone
While venture capital continues to show interest in the sector, the retreat of growth investors and the genuine prospect of a prolonged down cycle ahead has left growth-stage deep tech companies needing to implement stringent cost-cutting strategies to curtail expenses and extend their runways. But even those fortunate enough to have secured inflated funding rounds during the exuberant market conditions of 2021 will soon need additional investment.
Deep tech companies typically have high burn rates due to their heavy focus on research and development, requiring funding approximately every two years on average. With dwindling access to VC cheques, a non-existent IPO market, and practical limits to self-sufficiency, M&A is already emerging as a valid route to realising substantial profits for investors and founders, even if it doesn’t deliver the lofty $1bn+ valuations seen in 2021.
We’re already seeing more companies take this route. European deep tech M&A activity has rebounded to levels not seen for years and across our focus verticals, spanning Advanced Materials, Space, AI & ML, Cybersecurity, and Robotics, European M&A transactions have already rebounded to surpass 2020 levels (183 this year, annualised versus 176 in 2020), with some notable exits such as InstaDeep’s sale to BioNTech and SLM Solutions metal 3D printing business being acquired by Nikon.
In 2024, we forecast 250+ M&A deals in European deep tech, with at least 20 above $100m, making it the strongest M&A year since 2016. A key driver of this resurgence is the substantial increase in established deep tech companies across Europe, with many more companies fielding 100+ employees and sizeable, valuable engineering teams. The funding-driven growth in the size of European deep tech companies now makes many more sizeable, more strategic targets for international acquirers.
Overall, we anticipate the remainder of 2023 and 2024 will be banner years for European deep tech M&A, with potential deal value reaching $20 billion or more in the next 15 months alone.
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