Crypto-assets and EU regulation: to a global format

| January 15, 2019

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It is increasingly becoming a certainty that crypto-assets are here to stay. Also regulators are now more convinced that these will be here for the long run. Long time taken a wait-and-see attitude, there is growing consensus at European regulators to come up  with EU-wide regulation. While on the one hand EU regulation could give the crypto market legitimation and encourage the adoption of crypto-assets.

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Willis Towers Watson

Willis Towers Watson (NASDAQ: WLTW ) is a leading global advisory, broking and solutions company that helps clients around the world turn risk into a path for growth. With roots dating to 1828, Willis Towers Watson has 39,000 employees in more than 120 countries.

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BEHAVIOURAL ANALYTICS WILL FUEL CUSTOMER INTERACTION IN FINANCIAL SERVICES

Article | June 1, 2021

The axing of third-party cookies by Google and the other major browser companies will require a major readjustment by financial services organisations. The decision, coming fully into force next year, will effectively choke off the data that has enabled personalisation, optimised website interactions and driven much internet advertising. It is no comfort that the browser companies have acted because of fears about infringement of privacy and data protection legislation such as the EU’s GDPR (General Data Protection Regulation) and the CCPA (California Consumer Privacy Act) in California. The move will affect how UK financial services organisations interact with millions of people. More than three-quarters of Britons now use online banking and 14 million use digital-only banks, expecting a slick, light-touch interaction. So it appears that just as many people go digital, financial services organisations will no longer have access to information they need for personalisation, being unable to track where customers go on the internet after they have visited a bank’s website. All that data about individuals’ habits and preferences will be unavailable. It seems catastrophic, but in reality, it is not. Financial organisations have a new opportunity to radically improve how they interact with web visitors and customers. AI-powered behavioural analytics offer far superior, real-time capabilities, using the data from the first-party cookies on their own website domains and where available, data from customers’ transaction histories. The result is a solution that is faster, more accurate and responsive than conventional technology relying on cookie data owned and stored by third-party organisations. Instead of relying on such data for relatively rigid profiling and personalisation, behavioural analytics enables real-time interactions based on a more dynamic picture of how an individual’s requirements are changing. The technology analyses all the browsing characteristics including time on site, speed of movement and page views, as well as more obvious features such as interest in specific products. Historical data added to the analysis includes what customers did on previous visits and the interval between those visits, establishing patterns where possible. The flexible advantages of behavioural analytics hubs in financial services Segmentation allows a bank to identify customers as soon as they arrive on its site, according to whether they are a new or existing customer. Their behaviour then indicates what they want. Knowing what customers are interested in is important. Customers visit financial services websites for a host of reasons – from seeking information, to opening accounts, exploring loans and mortgage offers, making or setting up new payments. They may also want advice about investments and savings, pensions or small business finance. Almost all of these requirements involve quite complex mental processes which financial organisations can influence while consumers are on their sites. Collecting the data is not difficult – the skill is in making it actionable in an effective way, replicating the ability of a perceptive employee to read a customer’s state of mind. Banks can do this by setting up a behavioural analytics hub to understand what a customer’s behaviour means and how it can be optimised. Using customised parameters, the hub will, for instance, trigger a screen notification that prompts the web visitor to fill in a form requesting an appointment. In the case of existing customers, the technology can correlate health insurance offers with spending on fitness, and, in general, savings and investment recommendations can be tailored to the client’s concerns or goals as revealed by their navigation of a bank’s website or mobile app. Banks can set up analytics to see when consumers are behaving in a way that indicates they about to leave the website, allowing them to intervene with a notification that could include an offer. This provides a positive outcome and avoids the blanket use of offers that undermines profitability. It is a more sophisticated and personalised approach that avoids annoying pop-ups or recommendations that fail to match individual preferences. As part of a single AI-powered segmentation platform, the technology enables banks to personalise marketing content in SMS messages and emails sent to consumers (who consent), which deliver far better results through precise targeting. Solutions for last-mile interaction in the open banking era The single platform approach also has another major advantage. It is much easier to implement and far more efficient and streamlined compared with separate solutions for different parts of the customer journey. The benefits of using AI-powered segmentation solutions should be part of the financial sector’s broader strategy to transform its systems for the open banking era as we approach the end of third-party cookies. For established banks, the reality for some time has been that complexity of systems has undermined their ability to deliver a high-quality last mile. This they can now address without huge disruption or investment. The alternative is for financial services organisations to become lost on an ocean of data, losing track of customers. Behavioural analytics will bring banks new insights into customers that surpass third-party cookie data, being actionable and accurate and in real time. To provide a streamlined and profitable experience for themselves and their millions of customers, banks must now employ the latest advances in AI-powered behavioural analytics.

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COVID-19 Outbreak and Crypto Market

Article | June 1, 2021

The futuristic utopia that technological progress promises is coming ever closer at an astonishing pace, yet unseen challenges, have surfaced during the COVID-19 virus outbreak. The pandemic has managed to plunder and destabilize the world in just the last few months, putting in danger not only lives, but economic boundaries, well-established global businesses, and the very essence of the world’s financial system.

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How to enhance the customer experience in the Fintech Industry

Article | June 1, 2021

Fintech or Financial technology is the industry that delivers traditional financial services in a technical manner. The industry has been there for a long time but made significant growth in the previous few years. New cryptocurrencies and payment solutions are surfacing, and the industry is projected to make significant growth of $309.98 billion at an annual growth rate of 24.8% through 2022.

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FINANCIAL MANAGEMENT

Technological Innovation and Everyday Lifestyle

Article | June 1, 2021

Technological innovation over the recent decades has attracted increased interest of researchers and industry experts thereby becoming an integral part of everyday lifestyle. The challenge lies in resolving the dispute between a forward-looking innovative structure promoting innovation, and a proportionately meticulous schema that is capable of winning faith of consumer. Information technology is fast turning to be a key instrument in the lives of consumer across generations. In current global economy, customers across industries have been pampered and the credit goes to “Bigtechs ” like Ali Baba, Apple, Amazon, E-bay, the list being exhaustive along with “Fintech ” and “Incumbent banks ” as a result, consumers expect swift product delivery with flawless service. A review of available literature is suggestive that further expositions tend to focus on fintech and its integration in banking arena investigating the factors that underpin the choice of external partners to collaborate, design, develop and implement fintech capability while addressing the gap between research and industry evolution. Recent developments in technology have refurbished global economies at an immensely fast pace, making the business environment extremely challenging with continued margin pressure. Digital technologies are intrusive to not only the competition but also to the role of payments in businesses impacting the ultimate consumers. Investigating digital transformation has been of continuing interest across industries. Digitization might abolish some vital job roles, threatening the human workforce reluctant to digital changes. However, observations are indicative of focus towards higher-value tasks and creating unprecedented opportunities. For instance, adoption of digitization in financial industry, provides considerable opportunity to relationship managers to spend minimal time in operational activities and maximum towards advising customers. Amongst many ideas laying the foundation of fintech adoption, a growing body of literature recognizes two vital causes for the evolution of fintech companies that can be routed back to a decade. Firstly, the global economic financial crisis also called economic recession that has distinctly exhibited to consumers the flaws of the traditional system. Second, the evolution of new technologies that boosted mobility, easy flow of information, speeding up the service delivery and lowering the costs. The way banks engage the customer today has gained fresh prominence, with a movement from branch banking to digital systems, benefitting from customer insights. Aiming to enhance consumer engagement and gain competitive advantage, debates continue about the best strategies banks adopt to engage with customers that has resulted in adding capabilities and complex technology on top of systems and processes to meet dynamic customers’ expectations to gain real time personalization. Much debated question is whether organizations with traditional framework are able to come up to such expectations becoming capable of disrupting industry by prompt digital delivery using advanced algorithms and digital platforms to successfully provide unrestricted access to information bits. Promising superior experience to users, however, if industry experts hit the bulls-eye and tend to offer more competitive prices, enhanced operational controls may entitle lesser risk and probability of higher revenues. Such developments bring along advantages and disadvantages at the same time. Whereas advantage lies in reduced transaction processing times, service excellence and global integration the disadvantages lie in the fact that not many users are keen to shift to the fintech modes as far as their financial transactions are concerned since they are apprehensive of the risks associated with such adoption, witnessing this paradigm shift in the pace at which industry is developing focussing on much saturated red ocean of retail banking and gradually making a shift towards payment systems, which seems to be an untapped blue ocean of opportunities. The underpinning factors that govern the financial industry are KYC / AML and CFT together forming the basis for regulatory controls. Ethical transparent business knit together with service excellence, minimal risk, a strong regulatory framework in the competitive industry has given the incumbent banks an opportunity to partner, collaborate and codevelop with technology and consulting firms for collaborative innovation. Technologies like artificial intelligence, blockchain are capable of providing effective product suite to clients resulting in scalability of business.. On the other hand, robots replacing front end customer interface causes threat of redundancy to human capital and increase the training costs. As a result, many times an informal approach to collaboration tends to delay the outcome since the senior management looks at digitization in transaction banking as a profitable step and the middle management is hesitant of human redundancy, training etc which might cause delay. Taken together, a probable explanation advocates that common goals of digitization in financial institutions are regulatory control, risk mitigation, increase in revenue and to meet dynamic customer expectations by co-developing with external partners to gain competitive advantage. This adoption may further lead to higher cohesiveness in departments, improved value chain and reduced turnaround time with higher resolution quality. The digital transformation is capable of reducing the operational costs and overheads leading to increased profits, improved efficiency, better regulatory controls with less risks and collaborative opportunities for partners taking benefit of its tech talent to reach desired results. References: Anikina, I.D., Gukova, V.A., Golodova, A.A. and Chekalkina, A.A. 2016. Methodological Aspects of Prioritization of Financial Tools for Stimulation of Innovative Activities. European Research Studies Journal, 19(2), 100-112. Boston Consulting Group 2018, Three Keys to successful digitization in Transaction Banking, Boston Consulting Group, pp1-2 Botta, et.al.,2016. Technology innovations driving change in transaction banking. [Online] Accessed on March 11, 2018 Available at:https://www.mckinsey.com/industries/financial-services/our-insights/technology-innovations-driving-change-in-transaction-banking Capegemini & LinkedIn, 2018, World Fintech Report, p. 9-10 Hammond, Alex, August 2017, How banks are getting the digitization of core banking wrong, pp 1-8, [Online] [Accessed on April 02, 2018] Available at:https://www.bobsguide.com/guide/news/2017/Aug/23/how-banks-are-getting-the-digitisation-of-core-banking-wrong/ Johnson. et. al., 2017, Exploring Strategy chapter 3 Industry and sector analysis, pp. 62-91 Markovitch, Shahar & Wilcott, Paul, May 2014, Accelerating the digitization of business processes, Digital McKinsey, McKinsey & Company, pp 1-5 Mehrotra, Mohit, 2014, Digital Transaction Banking: Opportunities & Challenges, Deloitte Consulting Pte Ltd., pp 1-22 Olanrewaju, Tunde, July 2014, The rise of the digital bank, Digital McKinsey, McKinsey & Company, pp 1-5 Puschmann, Thomas, 2 February 2017, Fintech, Bus Inf Syst Eng 59(1): 69-76, Springer Fachmedien Wiesbaden 2017 Saksonova, Svetlana, Kuzmina-Merlino, Irina, 2017, Fintech as Financial Innovation – The Possibilities and Problems of Implementation, European Research Studies Journal, Volume XX, Issue 3A, pp 1-14

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Spotlight

Willis Towers Watson

Willis Towers Watson (NASDAQ: WLTW ) is a leading global advisory, broking and solutions company that helps clients around the world turn risk into a path for growth. With roots dating to 1828, Willis Towers Watson has 39,000 employees in more than 120 countries.

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