Fraud Academy ”“ Cryptocurrency: Opportunity vs Threat

Fraud Academy ”“ Cryptocurrency: Opportunity vs Threat.

Are you familiar with the legislation and rules that pertain to cryptocurrencies in the United Kingdom? What can be done to prevent crime involving cryptocurrency, where could fraudsters go from here, and how do we begin to investigate this?

PwC are hosting a highly informative virtual event and will explore these questions, and more.

Date: Wednesday 9th February 2022
Time: 13:00 – 14:15 (GMT)
Location: Virtual / Webcast

Register Here

Within the first nine months of 2021, cryptocurrency related fraud is estimated to have cost the UK over £146 million; a figure already 30% higher than that noted for the whole of 2020. Over 7,100 reports of fraud involving cryptocurrency have been made to the UK’s national reporting centre for fraud. More than half of victims were aged between 18 ”“ 45.

Cryptocurrency will only become a bigger part of how we do business, presenting both an opportunity and a threat; yet how ready are we to make the most of the opportunity and to deal with the threat?

Are you aware of the legislation and rules which exist in relation to cryptocurrencies in the UK? What can be done to prevent crime using cryptocurrency, where could fraudsters go from here and how do we start to investigate it?

At this highly informative virtual event, we will explore these questions, and more with a panel of deep subject matter experts.

We are delighted to be joined by Jim Robertson (DCI, Police Scotland), who will give an overview of the current lay of the land’ from a policing perspective in relation to cryptocurrency and discuss how law enforcement is dealing with the challenges of an increase in this crime type.

Jim will be joined by Craig Kennedy (Partner, Dentons), who will discuss the legal powers available in relation to cryptocurrency in the UK and the potential risks and benefits of using cryptocurrency.

We will also be joined by Haydn Jones (Senior Blockchain Market Specialist – PwC) who will share his own opinions and thoughts on the opportunities and threats presented by the rise in cryptocurrencies from his own experiences investigating and providing expert witness testimony on cases involving cryptocurrency.

Attendees will also have the opportunity to put questions to our speakers during a Q&A session.

We look forward to welcoming you to our event on Wednesday 9 February 2022 at 1:00pm.

If you have any questions about this event, or have any issues registering for this event, please contact the team via uk_fraud_academy_scotland@pwc.com or uk_ni_fraud_academy@pwc.com.

PRESS RELEASE: Automation the key to growth and data management for banking and payments sector, finds new report

A new report from leaders in reconciliation and finance automation software, AutoRek, has found widespread concerns around the ability of businesses to grow amidst scalability and regulatory pressures over the next three years, affecting 92% of professionals surveyed.

The report ”“ Banking and Payments in 2022: Digital transformation and trends in financial technology ”“ was designed to provide an insightful view of the key challenges and solutions that will face the financial industry as it enters 2022.

AutoRek gathered insights from senior professionals across the banking and payments industry on the barriers they face surrounding the handling of payments data, compliance and growth, and new technologies in use or consideration.

Automation was found to be a key source of hope for enabling growth and regaining competitive advantage. Other key findings include:

• Manual processes form the biggest roadblock to achieving automation, cited by 46% of firms, followed by legacy systems (42%), poor interoperability (40%) and regulatory requirements (38%).
• In-house IT solutions are the most common for data handling across payment operations, used by 44% of firms ”“ a higher reliance on in-house systems than in most other sectors.
• Almost one-third of firms consider their jurisdiction’s regulatory body audit and control around regulatory reporting infrastructure somewhat or far too strict, while 22% consider it somewhat or far too lax. Just under half consider it appropriate. Financial institutions in central and south America were considerably more likely to view their regulators as lax than their European and Asia-Pacific counterparts.
• When selecting a solution to handle payments data, almost 80% of respondents consider its ability to integrate easily with existing infrastructure a key factor.
• Over half of respondents (56%) either already have or are in the process of deploying modern technologies such as artificial intelligence (AI), machine learning (ML) and application programming interfaces (APIs) to help monitor and streamline their data management processes. One-third had onboarding planned in the next 12-24 months. Only 12% reported having no plans to apply technology to improve data management processes.

Firms slow to adopt emerging technologies should be aware that they are now falling behind in an increasingly automated and competitive landscape, according to Nick Botha, Banking Lead at AutoRek.

Commenting on the findings of the report, Nick Botha continued: “While automating data flow has been a priority for some years now, this survey makes clear how many inefficiencies continue to plague firm’s day-to-day operations when it comes to data processing and reconciliation. Legacy banks in particular are grappling with often more than 20 disparate systems written in varying generations of software, none of which are designed to interact with one another.”

“While a decade ago that might have flown under the radar, the last few years have seen control of the payments space shift from banks into the hands of Payment Service Providers (PSPs), whose ability to deliver totally user-native customer service is forcing the whole industry to step up.”

“Beyond competing for market share, it’s a question of compliance. The costs associated with non-compliance are substantial both from a financial and reputational perspective, and regulators are increasingly less forgiving, as we have witnessed in the last few months with significant fines incurred by some of the world’s largest banks.”

“New technologies like AI, ML and APIs can be used to create greater interoperability and remove or significantly reduce manual interventions and use of spreadsheets. Investing in these capabilities today will enable firms to address evolving customer preferences, mitigate risk and achieve regulatory compliance down the road ”“ essential elements for remaining competitive in the payments landscape of today.”

Download a copy of the report here.

Banks’ Responses to Embedded Finance and Banking

WRITTEN BY RISE, CREATED BY BARCLAYS

Rise, Barclays’ FinTech ecosystem, is the #HomeOfFinTech and publishes its regular thought-leadership report, Rise FinTech Insights. This edition focuses on Embedded Finance.

In this article, we explore what Embedded Finance might mean to incumbent banks. It’s an area that’s gaining a lot of traction in both B2C and B2C markets across many sectors. In payments alone, Embedded Finance 2020 revenues were $16.1 billion, but by 2025 they’re forecast to reach $140.8 billion[1].

Banking as a Service

Key enablers of Embedded Finance that impact banks greatly include Banking as a Service (BaaS). This is expected to drive great disruption as new BaaS providers’ and the more innovative banks create new and better infrastructure supporting not only the surge in new payment models and Point of Sale financing that is driving eCommerce but also completely redesigned digital journeys that extend beyond retail into non-financial sectors like healthcare, education, agriculture and music.

Those digital journeys will need to be underpinned by new services that must be always-on, reliable and performant at all times. This will often require a significant uplift to the current technical capabilities of the incumbent banks, which will have to deal with legacy systems that are decades-old and costly to adapt to new propositions. This is possibly why we see incumbents invest so heavily in digital-only propositions and in their tech stacks.

Cloud

Another key enabler is cloud computing and its on-demand and highly elastic and configurable capabilities. Disruptors in this space have varied pedigrees ”“ FinTechs, Big Tech, neobanks and incumbent banks are all leveraging the cloud’s potential to innovate faster at a lower cost and to support newer and better B2B and B2C use cases.

In the drive to take financial services to new heights using cloud technology, FinTech representation is, as you’d expect, healthy and has allowed some startups to scale fast. In the payments space, for example, Adyen and Stripe have built modern platforms designed from the ground-up with the cloud at their core. Traditional banks are keenly aware of the disruption to banking experiences brought by neobanks. They of course rely heavily on the cloud and may be able to leverage this core strength to embed payments and other financial features into third-party, web-based products more easily than many incumbents currently can.

APIs

Finally, let’s consider APIs. They’re what lets a bank extend its reach into the new digital journeys of Embedded Finance. Whether it’s a payment transaction at the end of your taxi ride or a request for an instant personal loan when you purchase a luxury item, there are numerous jobs-to-be-done that culminate in a banking transaction. Research tells us that users are reluctant to move to a different digital site to complete that transaction, and the behind-the-scenes operations of APIs support a better, seamless experience. It’s these frictionless experiences that are king in today’s digital world.

When it’s the cloud or APIs, the developer experience should be paramount to banks. After all, other companies’ developers will be the first consumers of any new service that’s created, and if they struggle with opaque processes, difficult integrations or non-intuitive interfaces, banks will lose the agility and scale that allow them to deliver great customer experiences. FinTech developers must be allowed to experiment easily with safe’ data and sandboxes because, only if they’re in place, will financial institutions be able to co-create value propositions at scale.

Thinking like a FinTech

Embedded Finance means that banks will be collaborating with nimble digital players ”“ quite possibly acting nimbler than banks are traditionally used to. You need to move fast to partner with some of the big retail and tech brands ”“ slow and cumbersome processes may present a challenge. This, in part, is why Barclays has signed the FinTech Pledge.

Ready to collaborate?

Can banks think like FinTechs? At Rise, created by Barclays, we like to think so. If you’re in FinTech and are as excited as we are by these developments, we’d love to hear your ideas and thoughts. Contact your closest Rise team in London, New York or Mumbai to discuss how we can collaborate.

Read more about Embedded Finance and BaaS in the Rise FinTech Insights report.

Visit Barclays API Exchange.

[1] https://www.forbes.com/sites/ronshevlin/2020/08/03/ubers-departure-from-financial-services-a-speed-bump-on-the-path-to-embedded-finance/?sh=790efe967673#484180287673

Card issuing and management: staying relevant facing ever faster changing customer expectations

How card issuers are rethinking their business models and technical architecture

Our payments landscape is changing rapidly, and traditional card issuers need to keep up with new competitors that meet customer expectations. Especially now, during times of lockdowns and working from home, customers are expecting digital services that are seamlessly integrated into their every-day lives. This means that Issuers have to rethink both their business models as well as their technical infrastructure to keep up with competitors and customer expectations.

Convenient, fast and reliable

First of all, how popular are card-based payments nowadays? As research shows, this payment method will play a major role in the near future. By 2022, it is estimated that 47 percent of global e-commerce payments will be made using eWallets, while 28 percent will be made using credit and debit cards. At the point of sale (POS), it is expected that 52 percent of all global POS payments are made using either a credit or debit card, with eWallets (28 percent) assuming the third place. These numbers have to do with the fact that consumers find card-based payments convenient, fast, familiar, reliable and secure. A little further in the future, we are likely to see the general replacement of tangible plastic cards by alternative means of payment like mobile payment apps and virtual cards. However, the payment itself will remain card-based and will, thus, to a large extent rely on the established infrastructure of schemes like Visa, MasterCard and local schemes.

Crowded Landscape

This is the reason that the card issuing landscape is getting increasingly crowded as new players spot opportunities to tap into the unresolved growth potential of the card payments industry. Over the years, many traditional banks have delivered card payments services on a license to operate’ basis, meaning that they have typically issued basic products like debit, credit and prepaid cards and have not shown any interest in differentiating themselves through these products. Neobanks seem to be utilising the full potential of cards and card payment services by making them the focal point of additional services. This places the cardholder at the center of the payment experience. Think about services and features like real-time information on transactions, convenient onboarding processes and product control (for example spending limits and geo-blocking).

Challenges

As a result, traditional card issuers are feeling the pressure of increased competition. It urges them to transform their card processing platforms to remain competitive, but there are a number of internal and external challenges that need to be overcome. Think of diversifying channels and the demand for a consistent experience or the creation of new technologies that are disrupting financial services and the arrival of regulations like Open Banking, PSD2 and GDPR. Other than that, players are forced to focus on efficiently processing massive volumes to make the business case viable. In the meantime, internal challenges play a key role as well. Traditional players are, for example, struggling with their legacy systems and their ability to leverage the vast amount of data points produced by transactions. Besides that, players need to protect sensitive data and actual monetary transactions against fraud. And there is also the struggle of managing the increasing number of compliance procedures.

The Solution: Open Innovation

While there are many interesting solutions from Fintechs and other third parties available that address some of these challenges or simply offer a superior frontend experience, they are often hard to integrate into existing legacy applications and some processing partners do neither offer a modular platform nor the commercial flexibility required to quickly test and integrate third party solutions. At Worldline, we are convinced that the best results come out of open innovation. That is why we are hosting the annual Worldline e-Payments Challenge where we bring together our clients and fintechs to create innovative use cases together with our experts. Our modular, real time processing platform allows for simple integration of these solutions based on a large and powerful set of APIs.

Are you looking for creative ways to address the challenges Issuers are facing today? Get in touch with our experts to learn how Worldline can support you. Contact Us: worldlinecommunications@worldline.com

On-Land Payment Infrastructure for Rapid Growth