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INNOVATION WITHIN TIME

By Richard Hoptroff, CTO and Founder, Hoptroff

 

The Finance Industry has always been quick to innovate, from the ATM to online stock trading to contactless payments. Emerging technologies offer opportunities to reduce operating costs, refine business processes, and improve efficiency and Financial Services recognises the benefits that can come from being ahead of the curve. Traceable timing is one such innovation with a lot to offer.

 

Using digital ledgers to improve the traceability of data

Digital ledgers receive a lot of attention mostly for being the technology behind the high-profile cryptocurrency, Bitcoin. However, there is great scope for digital ledgers to be employed across other applications and Financial Services are only just beginning to tap into their potential.

By its nature, the Finance Sector demands the most secure mechanisms available to protect its sensitive data. Financial firms handle transactions that are not only enormous in value, but in number and frequency. It is no secret that banks no longer rely on physical records of their activities, or even gold to back their currency, the world runs on sequences of 1’s and 0’s on a computer system, so these computer systems must be incredibly reliable.

Richard Hoptroff

Digital ledgers’ system of encryption and linking of data into chains of events that cannot be edited or copied offers that reliability. The entries in the ledger are immutable and cross-published to third-party ledgers. If the ledger entries are changed, or the sequence of the entries is changed, the hash codes don’t match. The result is databases that everyone can trust.

The focus for a number of technology companies right now is developing ledgers that can bolt on to data, immutable in time and place, generating watermarks that not only guarantee the data is genuine, but also where and when it was created. This means that the native digital data now has a physical world verification embedded in it through the timestamp. By adding UTC (Universal Time) and location to blocks as they are created, we can ensure that these two vital parts of giving data a unique identity are fulfilled.

This technology has an immediate application in helping to enforce GDPR data protection regulations, creating an immutable record of where and when data may have been shared or used without an individuals’ permission, as well as the broader benefits of making data more traceable.

 

Atomic timing solutions and how they adhere to regulations

The benefit of atomic timing in Financial Services is not purely an opportunity on the horizon. Financial Services has some regulation in place to ensure its data can be trusted. This oversight comes in the form of MIFID II in the EU and CAT in the USA, requiring that all financial market participants have accurate synchronized timing on their trading servers.

If clocks on servers drift and are untraceable back to a verified source of universal time (UTC), conflicts can arise. Orders can look as if they arrived before they were sent, and there is no way to determine whose time was correct. The regulations stipulate that the clocks on servers must not vary from UTC by less than a millisecond, and in some cases by less than 100 microseconds. When a single delivery chain might involve many servers and that action is repeated thousands of times, then it is clear how lack of synchronization will compromise the usefulness of timestamps when you are trying to reconstruct a chain of automated activities after an event.

 

Networked Precision Time Protocol – An innovation for finance making solutions more accurate and more efficient at reduced cost

The alternative to traditional NTP timing distribution, Precision Time Protocol (PTP), is generally superior in accuracy, to levels of microseconds at the application level in a server, traceability, because it is derived from a trusted time source (GPS or a dedicated time feed), and crypto-security. However, until now PTP has been costly to install and complex to maintain, because it needs continuous checking and adjustment to ensure accuracy and traceability are being maintained.

Innovation in the timing sector has perfected delivering PTP efficiently over fibre optic networks, making timing accessible to Finance firms with ease. It can be provided to a higher degree of accuracy, and at significantly lower cost. Software constantly monitors and adjusts server clocks to within the mandated range of UTC, and it is easy to scale up to new locations.

The Finance Industry cannot afford to take any chances with its sensitive data, the stakes are high and demand that Fintech be at the forefront of innovation. Affordable precision timing is ready for Finance, both to meet current regulations and to form part of a more traceable, secure, and resilient future for data management.

Top 10

WHY INDONESIA IS THE WORLD’S NEXT DIGITAL PAYMENTS BATTLEGROUND

Kelvin Phua, Global Head of Payment Networks at PPRO

 

The COVID-19 outbreak has seen the e-commerce sector surge. Despite economic uncertainty, consumers around the world are turning to the internet for the goods and services that they previously would have looked for in-store. In APAC, this has meant that some emerging markets have accelerated their adoption of digital services; the growth that was projected to take years has only taken months.

One notable example of this is Indonesia. According to a recent survey, Indonesia’s e-commerce sector is expecting 50% year-on-year growth with its value set to reach US$35 billion in 2020, up from $23 billion in 2019. What’s more, 30% of the country’s growing e-commerce market is new to online marketplaces and 40% intend to keep using e-commerce after the effects of the pandemic lessen.

With this upward trend has come a reliance on digital payments, and both public and private sectors have responded accordingly. Recently, the Indonesian central bank announced that all mobile payment providers were to replace QR codes with the standardised QRIS (Indonesian Standard QR code), providing a single integrated platform for all transactions made using QR codes across multiple e-wallet providers. On the private sector front, LinkAja has launched an online shopping solution to overhaul traditional marketplaces throughout Jakarta by enabling users to pay for goods using an app with the products delivered straight to their door.

For e-commerce and digital payment providers, these examples are good indicators that the time is right to go after a share of this market.

 

Understanding the playing field

Indonesia possesses many of the key characteristics that are critical to a market’s adoption of digital payments. With a smartphone penetration rate of 60%, well above the region’s average of 51%[1], and having witnessed its middle class grow from 7% to 20% of the population over the last 15 years, it comes as no surprise that Indonesia’s internet economy has more than quadrupled in size since 2015.

Currently, there are 37 local payment methods (LPMs)[2] in Indonesia, with GoPay, Doku, OVO, Dana, and LinkAja some of the frontrunners in the battle to claim a slice of the payments pie. This number is expected to grow as Alipay formalises its entry into Indonesia in partnership with Bank Mandiri and Bank Rakyat Indonesia, joining WeChat Pay which was officially granted a licence to operate in the country this January in collaboration with CIMB Niaga.

The growing number of players jumping on board with digital transactions bodes well for the Government’s National Non-Cash Movement launched in 2014. Go-Jek’s recent funding round and Facebook’s plans to build an e-commerce ecosystem around WhatsApp will help accelerate the adoption of digital payments for millions of SMEs in Indonesia, with businesses already using the popular messaging service to interact with their customers. Similarly, PayPal’s arrangement with Go-Jek will see the latter’s users use GoPay at PayPal merchants globally.

With the influx of foreign payment services and investment catering to higher consumer demand while creating the digital infrastructure needed to facilitate higher payment volumes, Indonesia is shaping up to be Southeast Asia’s next digital payments battleground. But what does this actually mean for businesses and consumers there?

 

Navigating a fragmented payments landscape

With all this consolidation and market movement, payment providers are innovating quickly to strengthen and enrich their offerings by partnering with others to develop their own unique payment ecosystems. Initially, these new partnerships will result in greater efficiencies when it comes to connecting consumers and businesses through one platform. But the fundamental pain point remains; the development of multiple payment ecosystems will continue to create the dilemma of choice. Consolidation in the truest sense of the word is yet to be achieved, and the payments landscape in Indonesia remains highly fragmented.

Since Indonesia loosened investment rules in 2016, foreign e-commerce players such as Amazon and Alibaba have entered the domestic market, competing against homegrown firms such as Tokopedia and Bukalapak. This has provided consumers with access to a wider variety of goods at more competitive prices.

To keep up with consumer preferences in Southeast Asia’s largest economy, merchants and payment service providers would need to evolve – by delivering a customer-centric experience where consumers are able to pay with the local payment method they prefer and trust.

In the long term, businesses should refrain from the drawing of battle lines in Indonesia’s fragmented payments landscape and create a payment ecosystem that takes into account payment preferences of the local consumers. Those who seek to enter multiple markets through one payments platform-as-a-service will be the ones most likely to succeed in capturing the lion’s share of the e-commerce market.

 

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Technology

ARTIFICIAL INTELLIGENCE AND FUTURE OF TECHNOLOGY

Ashish Jain, CEO, Future FX

 

Artificial Intelligence refers to machine intelligence that is programmed to think like humans and mimic their actions. For example while writing this article, I am not actually typing it but dictating it out using the microphone and the text is being typed by Microsoft Word itself.

The ideal characteristic of artificial intelligence is to rationalize and take actions to achieve a specified goal.

As technology advances the previous methods of artificial intelligence are taken for granted as new necessities are conjured. For example the computer was one of the most iconic invention of artificial intelligence but now it is considered as mandatory.

Artificial intelligence is continuously evolving and has to evolve. Machines are made in a way that they understand mathematics, linguistic, psychology and many more other terms that are related to human mind.

Artificial intelligence is used in many sectors for example the medical sector. It is used to test drugs and medicines.

We have applications and games which includes chess where the computer plays against us this is also a feature of artificial intelligence. Similarly self driving cars are also an invention of artificial intelligence. These have to be designed very intelligently.

This can also be used in the financial industry to trace and flag activities in banking and finance such as unusual debit card activity or usage and large deposits.

This also helps to estimate the demand supply and prices of the estimates and that makes trading easier.

Earlier, we had to pay a visit to bank on order to deposit a cheque. Then we updated to ATM/Debit Cards and now you can be identified by your retina. Many different sectors have also adapted this method to make actions it more convenient and safe.

Some more examples of artificial intelligence are iPhone’s Siri, Google’s Smart Assistant, Amazon’s Alexa, Google Maps, Ride- sharing apps like Uber and Ola, diseases mapping, Automated investing, virtual travel booking, social media monitoring, inter team chat tool, NLP tools, etc.

Artificial intelligence is all around us and playing an active role in our daily lives. Every time we open our Facebook newsfeed, do a Google search, get a product recommendation from Amazon or book a trip online, we are using it immensely.

In the coming years, computers might match or even exceed human intelligence and capabilities on tasks such as decision- making, reasoning and learning, analytics and pattern recognition, visual acuity, speech recognition and language translation.

Smart systems in commodities, vehicles, day to day use objects will save time and effort offering us a more customized and comfortable future.

It will help the medical sector hugely in upgrading the medicines and treatments, inventing new ones which haven’t been found yet and making everyone’s lives more safer and healthier. A large number of data can be collected from person to person about their health and nutrition and thus changes can be made in the lifestyle.

Artificial intelligence will bring changes in the educational system making it more revolutionary and advanced.

Overall, every factor has advantages and disadvantages and artificial intelligence has it’s lot too. Considering all the advantages artificial intelligence will also affect the human decision making power, analyzing and rational thinking, lifestyle etc. It will make people lazier and will affect their creativity. It can also lead to unemployment due to increase in usage of machines.

Like everything has a balance, artificial intelligence needs to be balanced too so that we can enjoy it’s benefits without suffering the negatives.

 

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