While retail banking has quickly adapted to digital environment and incorporated the latest technologies, it is not the same for corporate and commercial banking. As an increasing number of consumers turn directly to Fintechs for standalone products such as low-cost international transfers and supply-chain financing solutions, corporate banking is facing competition like never before. In order to stay ahead of this competition, it has become vital for corporate banks to transform digitally.

Moreover, as greater number of tech-savvy millennials join the workforce, their expectations with the bank’s services and experience are also evolving. Akin to retail banking, corporate banking customers are also expecting quick, cheap and convenient banking services. The need for corporate banks to embrace digital solutions has never been greater.

Wissam Khoury, Managing Director for the Middle East and Africa at Finastra said, “It’s an exciting time to be part of the New Age Banking Summit here in Qatar, as the financial landscape in the Middle East shifts towards a digital and open banking architecture. Our platform for open innovation, FusionFabric.cloud brings together key players of the financial services ecosystem, from Fintechs and developers to consultants, enabling retail and corporate banks to open up APIs, collaborate to innovate and get ahead in the digital transformation journey. Being part of NABS will introduce the local financial services landscape to a world of opportunities.”

Formed in 2017 by the combination of Misys and D+H, Finastra builds and deploys innovative, next-generation technology on their open Fusion software architecture and cloud ecosystem. FusionFabric.cloud, Finastra’s cloud-based platform for open innovation offers a marketplace for the broadest portfolio of financial services software in the world today—spanning corporate banking, retail banking, investment management, managed services, and treasury and capital markets. Finastra is one of the largest financial technology companies in the world, with 90 of the top 100 global banks using its technology.

Finastra is participating as Gold Partner at 7th Edition New Age Banking Summit, Qatar on 18th September 2018 at InterContinental Doha – The City. The Summit is supported by Qatar Central Bank and Qatar Financial Center Regulatory Authority.

Organized by UMS conferences, the summit will not only highlight the challenges and opportunities but will provide a knowledge and networking platform that will empower the banks to devise strategies that will help them keep pace with the evolving financial eco-system in this digital age.

Data is the new oil for the businesses across the globe. Data management process is a continuously evolving process. Latest technologies come across every day to simplify this hectic job order and to solve business problems with the strategic advantage. As big data, IoT and cloud technologies are blending with conventional methods, businesses are adopting the latest competitive strategies to stay ahead of the curve. The two most important features of this race are data processing and analytics solutions.

In the banking sector analyzing data is a multifold operation such as combining machine learning with the subject matter, anti-money laundering or detecting cyberthreats fast using big data analysis. It has become imperative for banks to adopt the new age technologies in order to keep up with changing consumer needs and patterns.

Through innovative software and services, SAS empowers and inspires customers around the world to transform data into intelligence. SAS is a trusted analytics powerhouse for organizations seeking immediate value from their data. A deep bench of analytics solutions and broad industry knowledge keep the customers coming back and feeling confident. With SAS®, one can discover insights from the data and make sense of it all; identify what’s working and fix what isn’t; make more intelligent decisions and drive relevant change.

SAS is Analytics partner at 7th Edition New Age Banking Summit Qatar on 18th September 2018 at InterContinental Doha – The City. The Summit is supported by Qatar Central Bank and Qatar Financial Center Regulatory Authority.

Tony Shibly, Territory Manager – Qatar at SAS said, “We are extremely happy to be part of the New Age Banking Summit 2018 in Qatar this year. Unanalyzed data is an opportunity missed, therefore through this platform, we aim to showcase the critical role played by analytics in initiating timely and relevant customer interactions, reveal business insights for quick and data-driven decision-making, forecast outcomes that improve customer value management, and equip organizations with the capabilities to explore new business opportunities.  Moreover, the business challenges around compliance, regulatory reporting, fraud and financial crimes management and Risk management continue to be key areas where SAS has established strategic partnerships with local, regional and global banking institutions in which significant business value is driven leveraging SAS cutting-edge technologies and solutions.

Organized by UMS conferences, the summit will not only highlight the challenges and opportunities but will provide a knowledge and networking platform that will empower the banks to devise strategies that will help them keep pace with the evolving financial eco-system in this digital age.

 

About UMS Conferences:

Founded in 2015, UMS Conferences is a wholly owned subsidiary of United Media Services LLC, a leading media and communications company.

UMS Conferences has an extensive portfolio of industry-leading and stimulating summits, conferences, awards, strategic forums and expos around the world. It is known for building platforms that create value and deliver an unmatched delegate experience. Our events offer premium branding as well as networking opportunities for partners.

As businesses face disruptive challenges, there has never been a greater need for more knowledge and opportunities to collaborate and network. Our carefully curated conferences combine deep editorial insights with award winning event concepts, distilling the onslaught of information into something that can generate profits.

With flagship events like New Age Banking Summit, UAE-India Economic Forum, Global Blockchain Congress, Healthcare Innovation Summit, IoT Integration Summit, Finsec and CDO Conclave, UMS Conferences attracts a high calibre of delegates, speakers and partners, who value the knowledge we offer. Aligning with these events is a powerful way to engage with a high-profile audience and reinforce expertise and credibility.

 

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DOHA: The best financial App in Qatar just got better as Commercial Bank has redesigned its Mobile Banking App with significant improvement to the user interface, making banking easier and convenient for customers.

The new Mobile Banking App with its intuitive modern design is the first finance App in Qatar with voice recognition technology, allowing customers to navigate the App safely, securely and quickly.

The new App includes facial recognition for iPhone X users, an intuitive approach remembering your favourite transactions for repetitive usage, along with dashboard customization and profile personalization.

The new Mobile Banking App helps customers save time and money by banking at a time and place that suits them, and will be available for customers from the first week of April 2018.

Commercial Bank EGM of Consumer Banking Amit Sah said: “Commercial Bank is the market-leader in high-quality Digital and Mobile Banking channels in Qatar by using innovative technology to provide the best customer experience.”

“Our commitment to innovation which drives customer value never stops and therefore we have enhanced our mobile App with new features along with a modern & intuitive design that has made it more convenient for customers to bank with us,” he added.

 

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Digital transformation is on the rise, what are the key elements of a successful transformation that is required for a legacy bank?

Banks have the same challenge they have had for the past 30 years: the legacy systems issue, where they have a number of systems that do not communicate with each other. It’s amazing how much data banks collect on their customers, but because of this lack of systems integration, they end up without usable information. 

Let me give you an example. A group of mortgage bankers spoke with me about mortgage originators, which were causing them to lose market share. Mortgage, which itself is a loss-leader, is key to banks cross-selling to their customers. I asked them about their cross-sell ratio and the originating product, and they couldn’t tell me. They had separate data sources for credit cards, mortgages, you name it, but because these systems were not integrated, they had no answers.

Legacy banks must address their systems. This doesn’t mean creating a new system, one that won’t communicate with the other systems already in place, but a solution that links their existing data sources.  

 

According to you, what threats/challenges would traditional banks face with the emergence of innovative financial technologies?

Challenges to traditional banks link back to their legacy systems and a massive investment in bricks and mortar. The new Fintech disruptors do not have these problems, and they can operate anywhere with minimum investment.

A bank’s two distinguishing factors are that it may take deposits and it may be a participant in the payment system. Traditionally, the consumer has needed a bank to both receive and pay out money. FinTech technologies are slowly alleviating that need, which means that the payment system no longer belongs to banks. When your payment system no longer belongs to you, it opens the market to Fintech and Blockchain.

As interesting as this is, I’m a regulator and I have to ask the question, “What threats and challenges do regulators face in this disrupted market?”

Regulators exist to protect consumers, with protection generally focused on those who deposit money. The remit of the Financial Conduct Authority, the conduct regulator for 58,000 financial services firms and financial markets in the UK and the prudential regulator for over 18,000 of those firms, calls for them “to encourage competition.” Encouraging competition falls on the side of encouraging the disruption of the financial services firms they regulate, so it will be interesting to see what they do moving forward.

Regulators have to ask whether FinTech solutions should be regulated and if so, why? Developments such as the ASD Smartcard, where you deposit money on the card and then spend it, make it difficult for a regulator, as the originator is not a bank or a financial services firm.

The way that most FinTechs make money is volume, and all they need is a small piece of a bank’s business to make a profit, as they can operate from anywhere without the traditional investments of the bank. We must also ask where FinTechs would be regulated. The QFC Regulatory Authority regulates authorised firms in Qatar. What happens when financial services suppliers move around and are not exactly located anywhere? How do we determine jurisdiction? These are some of the regulators’ biggest challenges when considering this growth market.

 

Big techs are shifting to financial services. Do you think such a shift would threaten existing banks? If so, what are the risks that you foresee?

I would say that big techs are dabbling in financial services, testing the market right now, but they are a threat. As they make inroads on the financial services market, they are going to continue to fragment banks’ customer bases, and as a result, banks will lose customers without being aware of it.

A recent Financial Times article noted inertia on the part of UK bank customers to switch banks, but FinTech providers are finding ways to get the traditional bank customer going outside of the bank for certain services. This is a huge threat to banks, as there’s no knowing what pieces of business – and customers – will stray and when.

It’s a grab for market share right now, with technology and other sectors looking at controlling a piece of the business traditionally in the domain of banks. Over time, banks will end up servicing only entries and exits, and they can’t make money this way based on their current model.

Regulators fall into two camps – we regulate conduct and taking money from consumers. The risks that I see from a regulatory perspective are that regulators do not yet know the scope of the FinTech landscape and how traditional financial regulation applies to it. Banks face the problem of clinging to their legacy systems and expensive buildings in the face of virtual banking and customers who are tech-savvy and see a way to save money by trying FinTech providers.

 

EWALD MÜLLER, MD, Supervision & Authorisation, QFCRA will be speaking at 7th Edition of New Age Banking Summit Qatar.

#NABSQatar #NABS #Fintech #DigitalBanking #DigitalTransformation

 

 

Al Khalij Commercial Bank (al khaliji) has launched its first state-of-the-art humanoid robots, ‘Jassim’ and ‘Noor’, as the bank’s brand ambassadors during an unveiling ceremony held at the Um Lekhba branch yesterday (May 23rd 2018).

The humanoid robots have already adapted to the bank’s environment and have begun interacting with both customers and employees on diverse subjects ranging from product and services to general knowledge and fun aspects, the bank said in a statement.

“With this launch, the bank aims to sensitise the community on the rapid advances in smart banking capabilities around us. It emphasises the need to embrace such technological advances as part of everyday banking transactions.

“al khaliji has always been keen to usher in innovative next generation concepts and has purposefully customised these humanoid robots to deliver a very unique and personalised customer experience,” al khaliji said.

Jassim and Noor are designed to be genuine day-to-day companions and guides, and are the first humanoid robots capable of recognising the principal human emotions and adapting its behaviour to the mood of the interlocutor.

“The technology will complement al khaliji’s existing IT infrastructure and help our employees to add a unique experience for our customers,” said Rana al-Asaad, head of Personal Banking of al khaliji.

“We are sure that this addition will only accelerate the need for the bank to bring in more innovative products and services for its customers in the coming days. Jassim and Noor are keen to welcome customers to the bank and help guide them to make the right choice of product selection. The robots can select applications, simple or complex, to assist directly using interactive animations and demonstrations or can call staff when needed,” she added.

In the first phase, the humanoid robots will frequent the bank’s branches besides visiting some of the more popular malls in Qatar. They will also visit schools, universities, and colleges to introduce banking programmes for students and listen to ideas and suggestions offered.

Jassim and Noor are very likely to visit key employer worksites and present al khaliji as a preferred banking choice for new joiners. Additionally, they will always make time to meet shareholders at the annual general meetings, attend customer seminars and events, career fairs, and charitable events.

al khaliji said the bank is hopeful that with such innovations, it will be able to serve the local community even better and inspire the society to participate and contribute to new technology.

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In an exclusive interview for 7th Edition of New Age Banking Summit QatarHani Khalil, Head of E-Channels of Qatar National Bank, shares insights on key fintech disruptors, future of payments industry, emerging financial technologies and more.

 

Digital transformation is on the rise, what are the key elements of a successful transformation that is required for a legacy bank?

First and foremost traditional banks especially universal and larger size has to think of the cultural changes and make sure that the transformation is committed across all parts of the organizations and stem from top leadership down and not to be treated as creating a new product or new major program only. It should be part of the DNA of the organization even gradually.
Secondly to resist jump into the hypes and fads specially in the massive technological disruptions, instead is to have a flexible mechanism to quickly assess all the opportunities from customer, commercial and impact of change on the organization through an agile supported team formed from across the organization and directly sponsored by top management if not the CEOs. Thirdly to change rapidly how these banks operate in their new environment, from operational models, technology development, staffing and communication to customers. All this requires continuous commitment and determination to embrace the change from inside out and understand that it is time to elevate to a new level of serving customers and to protect their industry or transform into a commodity industry at the back end of the ecosystem or worse to die or being acquired or consolidated for more competitive banks.

 

What are the key fintech disruptors that you think will reshape the banking industry as we know it in 2018?

Fintechs are creating disruption to the stable banking industry in multiple fronts. There are far too many Fintech who claim that they have the right model to disrupt and make a permanent change in banking. However, I think there are far too few Fintech who will be able to make this disruption but with the right funding or acquisition by other traditional companies including traditional banks such as the example in UK, US and Southeast Asia. Having said this, Fintech that I think will be able to end up as winners will be in the area of payment innovation, customer centricity, AI and integrating customer ecosystem to create a meaningful customer journey. Moreover, some traditional banking industry players have also come up as Fintech and start acting like fintech with the solid backing of their strong traditional position, might be the biggest winners as they will not be under same pressure of investors or VCs to generate revenue in short-term and spin off their creation in profitable commercial models prematurely.
As examples of these two different types, are:
1) Fintech
2) Traditional companies creating fintech models
We also need not to forget about Technology giants who are in my opinion are in a stronger position to compete with banks and other industries as they have the best of the two worlds and have corporate philosophy and strategies which make them in a better position to act strongly against both the Fintech and banks at the same time.

Cooperation with Fintech and Tech companies should provide an edge to Banks who wish to provide a Lifecycle engagement as they place the customers in the centre place.

 

Can banks embrace digital transformation and innovative technologies while ensuring minimal risks?

The answer to this is possible if planned well ahead and to embark on strategic way to do transformation and innovation in a meaningful way to the bank business. The most important thing is to plan incremental solid changes that can deliver positive change to customers (customer experience) directly and enhance operational efficiency internally while showing sustainable growth in the business. However nothing comes without additional risks, but managed risk is the best chance to accept this change. As they say “no pain no gain” and “one size does not fit all”, where risk is part of the business anyway and with proper controls and support of management things will be under control during the change. Talented and skilful Staff relevant to today’s environment need to be re-trained and further develop new skills which is one of the hardest factors, increase in investment needs to be acceptable, getting quick wins in short term is also important to sustain this journey and engage customers in the change process would work very well to know the priorities of change. Security and regulatory has to be managed well by a specialized team to protect the change process from derailing at wrong time and lead to loss of investment which could be the greatest risk.

 

According to you, what threats/challenges would traditional banks face with the emergence of innovative financial technologies?

Mainly knowing what the customer would adopt in relatively acceptable period and not to jump into hypes and just wow factors. Trained staff to support this change and embrace the change and not to resist it. Financial regulation changes and restrictions is another major risk factor to banks as speed of change is much faster than speed of regulator adoption and apatite. IT change to be more agile and faster time to market in a more iterative approach than all or nothing as well as making delivery partnership with specific technology providers and avoid building in house except for core services as well as collaboration with non-traditional partners and other industries to help delivery the other part of the ecosystem needed for this change.

 

Do you see AR/VR as the future of payments?

No one can predict the future clearly, but in general AR/VR are two important technologies for future and payment can be part of it, now banks want to protect this business and hence, they might need to jump into integrating their payment systems to it in a meaningful way to customers. If AR/VR becomes part of useful customer journey, then it will make sense to integrate payments into it to complete the journey. However, I see AR/VR will create more value into core services of Retail business which will always need payment to complete the cycle.

 

What do you see as the future of payments industry?

The future of payment industry will still be shaped with the advancement of technology and integration of industries. But mainly it will always be an important part of creating the relationship with customers. Physical payment will continue to diminish away from cash and plastic cards to digital (with the help of Mobile technologies?) It is also expected to have transformation to digital currency be it non-regulated cryptocurrency or government regulated cryptocurrency. Virtualization of credit card on mobile wallets will dominate the payment market to be used in store with contactless technologies or e/m Commerce online. P2P, P2B, P2G, B2B payments will be shaped in future and consolidated across the world. Instant international payment cross borders will be the norm be it through GPI Swift network or cryptocurrency network such as Ripple. FX rates will be more transparent and more competitive. Seamless payments during checkout process will allow customers to choose from all available best options for customer choosing currency or best fee seamlessly. Automatic and intelligent schedule payments and integrated with personal furthermore business cash management will be a standard model for payment providers. Collaboration and cross payment networking will create a transparent ecosystem similar to the code-share in airline industry.
So basically what we see today as changes in payment is just the tip of the iceberg and lots of intelligence and integration will be happening in the coming years.
Banks’ payments is under serious risk and disintermediation for the last few years and technology giants are innovating every day to hit this area where the value is for them and their customers, where banks are under risk to lose this value if they don’t response to these challenges. Blockchain distributed ledger if used for areas like identity management, contract and document management as well as payments will make significant changes to these areas in banking. Maturity and more clarity on the issues mentioned will help advance these areas.

 

Banks are reluctant to use Blockchain? Do you Agree or Disagree? Why?

I don’t think it is an issue of reluctance, it is more of uncertainty and lack of regulations around this area specially that banking is highly regulated and under stringent supervision. Blockchain has already took off as technology whereas still lots of scepticism when it comes to cryptocurrency using Blockchain. Many banks have experimented Blockchain for as distributed ledger for trade finance, money transfer and other niche areas.
There are still lots of uncertainty on ownership, usage, source of fund and top of all security but interesting to see the transformation as well

 

Blockchain/IOT/AI/Big Data/Cloud, which of these can change the banking landscape? And Why?

I think that AI will have the biggest profound impact not just on banking landscape industry but almost all other industries such as automobile, home appliances, travel, entertainment, etc. the reason why is because AI is actually using all other areas such as Blockchain, IoT, Big Data, cloud. Moreover, it has the most appealing and fascinating technology that can be easily understood and interact with. However AI today is still in early stages and has many areas that are maturing faster than each other such as deep learning, robotics, machine learning, etc. moreover, there are lots of ethical factors around AI that are not addressed well till today.

 

In your opinion, how should banks address the changing regulatory landscape with emerging financial technologies?

This is a tricky question and has an element of catch 22 where banking has been on receiving end of certain regulatory areas and on the other hand it is on the initiator end for other areas. Of course this is different from one region or country to another. However, in general the regulator and banks need to work together to avoid the situation where one side send the other their demands and to collaborate for the best of outcomes to benefit the industry and ensure regulations is transform to continue it objectives be it to protect the consumers, protect the economy, prevent fraud and financial crimes and balance the economy for all stakeholders.

Having said this, banks lately has faced rapid changes that enforce them to either deal with the new regulation or take the opportunities come from the new regulations. For example, open banking in Europe and UK and to lesser governed in Asia and Australia. Also the new GDPR and confidentiality/ transparency regulations as well as more stringent rules of AML and ATF being imposed. Not to mention the regulations for controls on Blockchain and payments as well as Basel III.

 

What do you think the future holds for security in IoT devices?

Generally speaking, IOT devices will have to have standards that govern certain areas of security and confidentiality such privacy, confidentiality, identity security and safety as well as the softer parts of ethical aspects. Hence, the IOT devices security should be transparent and have industry standards to be trusted by consumers. Also to allow consumers to configure easily and smoothly the level of privacy and confidentiality when it comes to sharing data and taking actions on behave of the consumer. Biometric usage will be a critical aspect to be used as one of the security controlled by the consumer, transparency of sharing information and locations should be made clear to consumers. Protection from fraud and misuse by unauthorized person or entities must be a priority to any deployments as these devices will become integral part of our daily lives very soon even as dormant devices. IoT devices in public use should also have governance to protect the innocent and ensure ethical part is taken care of.

 

Big Techs are shifting to financial services. Do you think such a shift would threaten existing banks? If so, what are the risks that you foresee?

It is expected to have more fierce silent competition with banks from the Big Techs such as Amazons, Apple, Ali Pay, Tencents, etc. where they are positioned in very well for competing banks where they have strong affinity to their customers and they have stronger relationship with them in their daily lives and they have a huge customer base for scaling. Also, they have deep investment and cash rich they are self-funded. They also creating the innovation independently, and they almost not regulated by any government authority so they have the freedom to be fast to market and more competitive. And finally they are global by operations where their brands are well known and trusted. Hence with all these factors, they definitely pose a risk to banking business as they are actually targeting the value in the customer cycle and only disintermediate the cycle where the customer feels their value and presence.

 

In your opinion, how can an organization boost its fraud detection capabilities?

This is a very important question and area that is usually neglected or at least left in the back burner while it is a crucial factor for sustaining the transformation in digital. Fraud detection must be proactive and smart. In a way to protect the users from potential hazards or automated electronic fraud or even socially re-engineered attacks to victims. The AI is also playing a good role in this area and start adding context to all customer activities and behaviour and trends and intelligently raising alerts and challenges that only customers can allow certain transactions or information to be permitted. There are a lot of tools coming in the market some are from fintech and others are from existing well-known vendors and each are innovating in this area heavily to ensure that all legitimate parties are winners be it the customers, financial institutions or for the good of the community as a whole ecosystem.

 

What are the key benefits and challenges that you foresee with open banking?

Open banking was firstly seen as a challenge to all banks, however when banks looked deeper, they understood that there is an opportunity for them to get closer to their customers and the more they become more open in voluntary way, the more they become more competitive in their own industry and in the Fintech industry. Banks started to realized that becoming more open and transparent while protecting the customer privacy and confidentiality, they will gain more business in have a long trust relationship which eventually will lead to a sustainable relationship that is passed across generations and create a win-win situation.
Open banking has enabled new opportunities to create a more engaged customer with their financial institutions where they can aggregate their positions across many financial institutions. Moreover, this consolidated view will benefit customers to manage their financials and cash flow positions more efficiently and subsequently can create cross-sell and up-sell opportunities for customers while being intelligently advice on setting their own targets and financial adequacy.

 

Hani Khalil, Head of E-Channels – Qatar National Bank will be speaking at the 2018 edition of New Age Banking Summit, Qatar.

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Digital transformation is on the rise, what are the key elements of a successful transformation that is required for a legacy bank?

A purpose of digital transformation is to fundamentally change how the business operate and interact with its customers. This requires comprehensive understanding of the new operating model, new essential business processes and architecture to support a target state. In order to be successful on transformation journey companies have to learn how to change fast at the risk level acceptable. One of the key pillars of every single change is the team to both drive and deliver changes. Acquiring new talents, retaining key employees while changing their roles and responsibilities is very challenging for an organization. Last but not least is also transparency on customer communication. It is relatively easy to lose customer interaction while changing an organization, introduce confusion or even detach from customers permanently. Banks should keep always in mind customers’ needs and constantly explain how the process is going to progress. In the end of a day customer can’t become just a single record in a system database.

 

What are the key fintech disruptors that you think will reshape the banking industry as we know it in 2018?

Banking sector is already under a pressure of reshaping its business models. A primary battlefield is on customer interaction that starts to be paramount more important than backend banking processes. Thanks to open banking and other regulations such as PSD2 in Europe banks have to accept other non-banking participants in a value chain. Customers still need banking services, but not necessary banks are supposed to deliver these end-to-end as in the past. Fintechs are trying to find their sweet spots on the market. There are already many good examples such as Stripe, Transferwise, Coinbase, etc. that introduced a lot of fear to the industry. Yet banks are not sitting and waiting and trying to transform themselves according to changing customers’ needs to stay relevant. There are multiple incumbent banks established over last that are very successful. On top of that there are many examples of fintechs and banks cooperation that provided significant improvement in customer experience and accommodating new business models. In short banks are getting more open to innovation while still maintaining banking licenses and actively transforming either by competing or cooperating with fintechs and other partners to meet XXI century demands.

 

Can banks embrace digital transformation and innovative technologies while ensuring minimal risks?

Introducing new or innovative technologies is always associated with risk. Historically, banks are superior in managing risks. Risk of introducing new technologies is not any different. There are multiple strategies how to transform and innovate while keeping risks managed at a desired level. Typically, banks (as well as other organizations) start small by prototyping, introducing early versions of their new services to so called “friends and families” or very well targeted customer groups. It helps to fail fast and quickly improve to start again. If successful, the key challenge is to scale the new innovative service up while managing changing operating models. This is very challenging for banks, in particular by managing legacy part of organizations and working in multiple contexts at the same time. In oppose to fintechs and start-up banks, legacy financial institutions do need to take care about existing customers at first while preparing for new customers acquisition and changing existing offerings. This is very significant undertaking hence not all banks are very successful in this field.

 

According to you, what threats/challenges would traditional banks face with the emergence of innovative financial technologies?

I think there are many. The most important is an ignorance. Banks cannot longer ignore changing business environment as new trends are emerging as well as changing technology landscape is creating new opportunities. It is however very difficult to guess which technologies are going to sustain and mature and which are going to disappear unexpectedly. Perhaps nobody remembers “second life” being a hype few years back and banks opening virtual branches there. That phenomenon does not exist any longer and money invested in it is undoubtedly lost.

 

Do you see AR/VR as the future of payments?

AR/VR is a technology that can boost many banking services not solely payments. It can significantly improve customer experience. I can imagine point of sale or POS transactions being extended with additional on hand information re credit limit, currency conversion, other product recommendations, etc. Payment process itself may also transformed into more seamless shopping experience by introducing additional information about available account balance, beneficiary information, spending patterns, etc. Generally, payments start to disappear as an isolated banking service and moving towards “invisible” step of shopping or purchasing activities.

 

Banks are reluctant to use Blockchain? Do you Agree or Disagree? Why?

It is somewhat right. Since an official legal framework doesn’t exist banks cannot make real use of the blockchain technology. An industry still lacking regulation on money on the ledger. There are however few countries trying to make it possible. Singapore, Malta are example of these. Before it happens there would be very limited set of (non-banking) use-cases that banks may be interested to invest in. Trade finance area is emerging very fast as well as a lot of is happening in identity management or exchanging market data. Yet, these are far from banks’ core business. In some extend it’s very compelling to experiment in some niche areas until ultimate disruption hits core banking business models. Undoubtedly, blockchain will play significant role in a future and as in every single revolution early adopters will be on much stronger position than slow followers. It somehow explains massive investments in the blockchain technology and exponential growth of expenses over the last few years. It is worth to mention that the technology itself is still in its infancy stage and there are many childhood disease problems that are still to be solved.

 

Blockchain/IOT/AI/Big Data/Cloud, which of these can change the banking landscape? And Why?

I think all these technologies will have a visible impact on banking landscape. These technologies however have different role to play or in other words different problems to solve. For example, cloud will help to improve flexibility in terms of acquiring business and IT solutions, help to avoid upfront investments, change spending patterns. AI will be extensively used for next generation of personalization, automation, more efficient process execution, preventing frauds, etc. Blockchain will help to simplify value streams by limiting intermediaries, helping to build ecosystems and increase trust across business collaborations and so on.

 

Big Techs are shifting to financial services. Do you think such a shift would threaten existing banks? If so, what are the risks that you foresee?

I think tapping into financial industry is a natural step for Big Techs to find new revenue streams and opportunities to grow. Big Tech are already known of redefining traditional business models into new, digital and desired by customers.  On top of that the Big Techs do have massive global customers base that makes their position extremely powerful and influential. I don’t think any of the Big Techs will apply for a banking license shortly. It would expect them to seek for “financial infrastructure providers” that will undertake all the licensed banking operations behind the scenes while Big Techs keep maintaining customer experience and interaction. At least that would be a way for a first step. Sometimes we use to simplify term “banking” to very basic financial services such as account management, card transactions, payments, etc. These are however just a top of an iceberg when looking at banking service portfolio. It requires a lot of knowledge, experience and professional personnel to undertake credit risk assessment, operate on capital markets or invest funds. More over these are very strictly regulated businesses. I don’t think any of Big Techs are going to be happy to satisfy all the necessary regulations and requirements across all the jurisdictions they operate on.

 

In your opinion, how can an organization boost its fraud detection capabilities?

The next generation fraud detection will emerge based on two pillars. One is more efficient data exchange between market participants both direct and indirect. Banks cannot basically work in isolation as it is known today. Second pillar is to employ more advance preventive mechanisms. Historically, based on best knowledge and experience, banks were developing fraud detection models, rules and execute these. If there was a new fraud rules were adjusted and re-implemented. This kind of approach is no longer sufficient. Thanks to new AI technologies such as unsupervised learning there is an opportunity to detect and prevent frauds from happening in real time. This kind of technology is still emerging, so it would take time until full benefits are available. Yet a lot of companies can already demonstrate significant progress in the field.

 

What are the key benefits and challenges that you foresee with open banking?

Personally, I am a big believer in open banking. I consider this trend more as an opportunity than thread for banks. First and foremost, open banking makes it possible to create true ecosystems across multiple industries. Thanks to this organizations will be able to freely exchange data, make transactions, simplify operating models and foster innovation. Naturally, there is a lot of work to be done until open banking will operate as desired. Still, there are no data global interoperability standards, set of data exchanged is pretty limited, legacy technologies cannot accommodate real time information flows, etc. This trend however is emerging at a fast pace and there is a big pressure to continue developing even faster.

 

Piotr PISKORSKI, Head of IT Strategy and Enterprise Architecture, Nordea, Denmark will be speaking at 7th Edition of New Age Banking Summit Qatar.

#NABSQatar #NABS #Fintech #DigitalBanking #DigitalTransformation

 

Qatar is quick to embrace the financial technology (fintech) revolution, having long recognised that digital technologies can raise both competitiveness and security, Oxford Business Group said in a report.

The push to digitise has been given an added boost by the blockade, as it has driven all sectors of the economy to invest in safer and more advanced fintech systems, Oxford said in its latest ‘The Report – Qatar 2017’.

Banks have been supportive of national fintech initiatives – such as the Smart Qatar Programme, or TASMU – and have also invested heavily in the digital transformations of their own processes, from back-office services to customer interface. Up-and-coming fintech companies have seen substantial growth over this period.

A notable example is the Qatari e-payment systems provider QPAY, which reported 300% year-on-year growth from its 2014 launch to November 2017, Oxford Business Group said.

“Equally, the fintech revolution has the potential to disrupt the sector, with new digital solutions challenging conventional banking structures and ways of doing business. Adapting to and benefiting from these changes will require flexibility and a pragmatic attitude towards cooperation, not only among commercial and investment banks, but also central bankers, customers and fintech companies themselves,” Oxford Business Group said.

Digitisation, it said, offers a range of advantages for the consumer, such as faster transaction times, greater convenience and better access to services.

For banks, offering online services and digital transactions increases speed and efficiency, while also lowering operational costs. Such measures reduce the need for physical branches and allow many procedures to be simplified, if not eliminated altogether.

Many of these changes could be implemented rapidly in Qatar because there is already a high level of Internet penetration in the country, with 2.2mn Internet accounts registered (as of June 2017) out of a total population of 2.5mn.

Moreover, a recent report from Hootsuite, a Canadian social media management software company, shows that Qatar and the UAE share the title of the highest rate of social media penetration in the world, at 99%.

Qatar is also ranked first for the proportion of the population accessing social media from a mobile device, with 95% of citizens doing so.

New fintech is increasingly utilised offline too. Contactless debit cards are available from the Commercial Bank and QNB, which can be used at near field communication terminals at many of the country’s retail outlets.

Ahilbank launched Qatar’s first contactless credit card in March 2016.

New digital services for those looking to bank outside Qatar are being developed, Oxford Business Group said.

Commercial Bank, for example, offers an online remittance service that enables expatriate workers in Qatar to send money to accounts back home – often in India, Sri Lanka and the Philippines – within 60 seconds. Indeed, digitisation offers the prospect of wider financial inclusion. This is particularly relevant in a country with a large, low-income expatriate workforce, who have often been neglected by the traditional banks.

The micro, small and medium-sized enterprises (MSMEs) sector has also been underserved in the past, paving the way for more inclusive fintech services to capitalise.

QPAY, for instance, offers a range of services directly to MSMEs, including a payroll wage protection system that is powered by MasterCard.

This enables workers to be paid via a digitised scheme that is in compliance with the Ministry of Labour and Social Affairs. As of November 2017 QPAY served some 10,000 businesses and 280,000 consumers, Oxford Business Group said.

Qatar’s industrial producers’ earnings display robust performance y-o-y in December 2017

Qatar’s industrial producers’ earnings displayed robust performance year-on-year in December 2017, mainly on higher prices for hydrocarbons, refined petroleum products, basic metals and chemicals and other chemical products and fibres, official data suggest.

Qatar’s producer price index (PPI) — a measure of the average selling prices received by the domestic producers for their output — grew 2.5% month-on-month during the review period, according to the figures released by the Ministry of Development Planning and Statistics (MPDS).

MDPS had released a new PPI series in late 2015. With a base of 2013, it draws on an updated sampling frame and new weights. The previous sampling frame dates from 2006, when the Qatari economy was much smaller than today and the range of products made domestically much narrower.

The PPI for mining, which carries the maximum weight of 72.7%, saw 15.4% surge year-on-year in December 2017 due to a 15.4% increase in the price of crude petroleum and natural gas and 3.1% in stone, sand and clay.

The mining PPI had seen 3.7% expansion on a monthly basis as crude petroleum and natural gas prices rose 3.7%.

The manufacturing sector, which has a weight of 26.8% in the PPI basket, witnessed 20.5% increase year-on-year in December last year because of 26.9% surge in the price of refined petroleum goods, 20.7% in basic metals, 10.3% in basic chemicals, 5.3% in other chemical products and fibres, 4.4% in dairy products, 2.1% in rubber and plastics products, 1.6% in grain mill and other products and 0.7% in juices; whereas those of cement and other non-metallic products declined 5.7%, beverages (2.3%) and paper and paper products (1.7%).

The manufacturing sector PPI had seen a marginal 0.2% gain month-on-month in December 2017 as price of juices shot up 11%, paper and paper products (3.5%), cement and other non-metallic products (1.8%), refined petroleum products (1.5%), dairy products (0.6%) and grain mill and other products (0.4%). Nevertheless, there was 4.2% fall in the price of rubber and plastics products, 3.3% in basic chemicals, 1.2% in basic metals and 0.3% in beverages.

The utilities group, which has a mere 0.5% weightage in the PPI basket, saw its index grow 10.8% in December 2017 on a yearly basis as electricity and water  prices soared 13.2% and 7.5% respectively.

The index had risen 6.9% month-on-month in December last year as there was 10.8% and 1.7% jump in the price of electricity and water respectively.

 

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Fintech Company QPAY has launched a major blockchain e-commerce initiative based on the ‘Ethereum’ blockchain platform in Qatar.

IBM’s Jerry Cuomo is encouraging the US government to develop the necessary policies that encourage blockchain use

In partnership with Nexxo Network – USA, QPAY has unveiled QPAY-SECURE, a suite of blockchain-based Decentralised Applications (D’APPS) and Application Programming Interfaces (APIs), which are built form the ground-up based on the Ethereum Blockchain platform.

The company has started its first test on the Ethereum Test Network and is preparing to officially launch in March, according to reports.

“Blockchain technology enables banks and financial institutions to provide the highest security in payments processing with tamper-proof digital records, and facilitate complete and immutable records of fund transfers. Using blockchain in payments processing, banks can readily trace the entire sequence of Business to Business (B2B), Business to Consumer (B2C) and Consumer to Consumer (C2C) transaction fund transfers.

QPAY noted that the platform is highly secured, trusted, tamper-proof and trackable transactions are the main reasons why the financial services industry is rapidly exploring blockchain technology.

“Implementing a blockchain-based payments platform is critical to our consumer and commercial clients. It is a clear signal from us that customer information is being handled securely and with trust,” said Nebil Ben Aissa, founder and CEO, QPAY.

Naren Kannan, head (Disruptive Application Team), Nexxo Network said, “We are partnering with QPAY and implementing blockchain technology in order to help build QPAY-SECURE; Qatar’s first blockchain-centric financial services platform.

“We are helping QPAY leverage Blockchain in order to offer a much more secured payment processing set of tools and features. The objective is to create an encrypted, digital ledger of secured financial transaction blocks, Distributed Apps (DAPPS) and APIs which can only be seen by authorised parties.”

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Qatar’s central bank will consider the topic of virtual currencies and there may be an opportunity in the future to introduce them in Qatar, Reuters reported.

Central Bank governor Sheikh Abdullah bin Saud al-Thani made the remark as he delivered a speech on Qatar’s plans to build a hub for financial technology.

The Reuters report noted that when asked about his stance towards bitcoin, Sheikh Abdullah said the central bank would not focus on a single virtual currency but would look at how to set best practice for such currencies.

The governor also said the central bank is developing a strategy to create a fintech hub for start-ups. Sheikh Abdullah said that the growth of fintech could force banks to change their business models. Already facing competition, “disruption from fintech could mean increased challenges for Qatar’s retail banking sector,” he said.

Central Bank governor Sheikh Abdullah bin Saud al-Thani will be delivering the inaugural keynote at 2018 edition of New Age Banking Summit, Qatar.

#NABSQatar #NABS #Fintech #DigitalBanking #DigitalTransformation

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