Global Banking & Finance Review Issue 58 - Business & Finance Magazine by Global Banking & Finance Review®

Issue 58

Embracing Change: NICE Actimize

on Generative AI, Cloud and the Future of Financial Crime

Exclusive Interview with CEO of NICE Actimize Craig Costigan

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CONTENTS

Chairman and CEO Varun Sash Editor Wanda Rich email: wrich@gbafmag.com Head of Distribution & Production Robert Mathew Project Managers Megan Sash, Amanda Walker Video Production and Journalist Phil Fothergill Graphic Designer Jessica Weisman-Pitts Client & Accounts Manager Chanel Roberts Business Consultants Rick Saikia, Monika Umakanth, Stefy Abraham, Business Analysts Samuel Joseph, Dave D’Costa Advertising Phone: +44 (0) 208 144 3511 marketing@gbafmag.com GBAF Publications, LTD Alpha House 100 Borough High Street London, SE1 1LB United Kingdom Global Banking & Finance Review is the trading name of GBAF Publications LTD Company Registration Number: 7403411 VAT Number: GB 112 5966 21 ISSN 2396-717X. The information contained in this publication has been obtained from sources the publishers believe to be correct. The publisher wishes to stress that the information contained herein may be subject to varying international, federal, state and/or local laws or regulations. The purchaser or reader of this publication assumes all responsibility for the use of these materials and information. However, the publisher assumes no responsibility for errors, omissions, or contrary interpretations of the subject matter contained herein no legal liability can be accepted for any errors. No part of this publication may be reproduced without the prior consent of the publisher

FROM THE

editor Dear Readers’ Welcome to the 58th edition of Global Banking & Finance Review. Whether you are a long-standing reader or are joining us for the first time, it's our pleasure to share insights and developments from the forefront of the financial industry. In this issue's spotlight, 'Embracing Change: NICE Actimize on Generative AI, Cloud, and the Future of Financial Crime,' we dive into the transformative strategies propelling financial institutions forward. Featured on page 24, our exclusive interview unveils how NICE Actimize, a vanguard in financial crime and compliance solutions, is at the forefront of integrating generative AI, cloud technologies, and advanced machine learning. NICE Actimize CEO Craig Costigan, reveals the impending innovations set to redefine risk mitigation and compliance, empowering clients to navigate the complexities of new technologies, regulatory demands, and emerging fraud challenges. As the industry gears up for 2024, join us in exploring the visionary steps and proactive measures outlined by NICE Actimize to ensure success in an evolving financial landscape. Turning our gaze towards Africa, we present an in-depth feature on Absa Bank Moçambique. Under the guidance of CEO Pedro Carvalho, Absa is not just participating in the banking sector; it is actively redefining it. Our exploration, starting on page 28, delves into how Absa is spearheading initiatives for sustainable growth, community development, and digital transformation, thereby reshaping the financial contours of Mozambique. Moreover, our thought-provoking piece, "What are we missing? Questions to ask to accelerate a digital evolution," on page 40, invites readers to critically analyze their digital transformation journey. This feature is designed to provoke reflection and strategic thinking, ensuring that the path to digitalization is not just adopted, but also optimized and aligned with the broader organizational goals. At Global Banking & Finance Review, our mission extends beyond reporting on the financial sector. We strive to be a beacon of knowledge, offering perspectives that are rich, varied, and most importantly, useful. Our content is crafted for everyone with an interest in finance, from industry veterans to those just beginning to explore this fascinating field. Send me your thoughts on how I can continue to improve and what you’d like to see in the future. Enjoy!

Wanda Rich Editor

Stay caught up on the latest news and trends taking place by signing up for our free email newsletter, reading us online at http://www.globalbankingandfinance.com/ and download our App for the latest digital magazine for free on Google Play and the Apple App Store

Issue 58 | 03

CONTENTS

Inside...

BUSINESS

FINANCE

How technology can help tackle unconscious bias in the workplace

Franz Janthana Kaenprakhamroy, Founder and CEO, Tapoly

Navin ‘nuvs’ Jain,

Product Evangelist, Workhuman

2024 Insurance Predictions

Why businesses must get ready for mandatory e-Invoicing

An outlook for the UAE’s fintech market in 2024 Shafique Ibrahim, CEO, Alif Pay

Ken Clark,

The power of lending relationships in syndicated loans

Director, Product Marketing,

Yafei Zhang,

Business Network Cloud

Lecturer in Finance at Alliance Manchester Business School

Balancing automation and human touch in HR and recruitment

Ms. Christine Sheng,

What trends will dominate the B2B payments world in 2024? Pat Bermingham, CEO, Adflex

Regional Managing Director, Talentvis

Financial wellness in marketing: How SMBs can build trust with Gen Z consumers

BANKING

Jacqueline Bourke, Senior Director Creative, iStock

Strategies for banking automation: A roadmap to optimal implementation Chris Tapley, VP, Financial Services Consulting at EPAM Systems, Inc.

Four ways payments will change in 2024 – Pay By Bank, digital footpaths, loyalty and insights David Maisey, CEO, MultiPay Global Solutions

The bank of the future Nanda Kumar, CEO, SunTec Business Solutions

20 04 | Issue 58

INTERVIEW

TECHNOLOGY

How to deliver trusted, safe, and responsible AI Shakeel Khan, CEO, Validate AI David Hand, Emeritus Professor of Mathematics and Senior Research Investigator at Imperial College

INTERVIEW

Absa Bank:

Achieving Benchmark Status in Mozambique

Lead like superheroes and embrace AI Jonathan Sharp, CEO, Britannic

Mitigating Cyber Risk in the Financial Sector Joao Correia, Technical Evangelist, TuxCare

What are we missing? Questions to ask to accelerate a digital evolution Nicole Hargreaves, Senior Business Consultant, Amdaris

How to keep financial data secure from cyber attacks Faisal Bhutto, SVP of Cloud and Cybersecurity, Calian IT & Cyber Solutions

Pedro Carvalho CEO, Absa Bank Moçambique

Issue 58 | 05

CONTENTS

Embracing Change: NICE Actimize on Generative AI, Cloud and the Future of Financial Crime

it on page 24 Cover Story... Read 06 | Issue 58

BANKING

Strategies for banking automation: A roadmap to optimal implementation Picture2224 - Global Banking | FinanceThe recent excitement and growth around ChatGPT and similar large language model-based (LLMs) tools will fundamentally change how everyday customers interact with banks and other financial services providers. According to recent research, 85 percent of financial services organizations currently utilize artificial intelligence (AI) in some form within their company, whether it’s used to collect data or serve as a customer service chatbot. Financial institutions must adapt to the rapidly evolving technological landscape by utilizing advancements in AI, machine learning (ML) and other new services and products pushed to market by their competitors. However, a necessary investment, with time and capital, is required to achieve these benefits.

Chris Tapley VP, Financial Services Consulting at EPAM Systems, Inc

Decision-makers in financial services organizations need to pay attention to the challenging economic environment that pressures them to protect the bottom line while delivering the quality and scope of services customers expect. Therefore, many banks must take direct and deliberate steps to significantly revise their technology stacks and operational processes to control current costs, optimize near-term revenue and position themselves for future growth. Automation will be a key tool to reduce the cost of critical processes. However, automation itself often requires modernization of the underlying technology infrastructure. If done correctly, this digital transformation has the potential to help banks build their competitive advantage. However, there are challenges associated with using AI and automation within finance. These include regulatory compliance issues, data privacy concerns and the potential for bias or discrimination. The industry must emphasize responsible and ethical usage of the technology.

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Given the vast number of changes and challenges this optimization can require, careful planning and execution are the keys to success. The essential investment areas for banks to effectively implement automation and create a seamless, personalized customer experience include: •

•

Robotic Process Automation (RPA): Financial services providers should focus on RPA as it helps streamline repetitive and time-consuming tasks, thus improving operational efficiency and reducing human errors. It can automate routine processes like loan processing, account opening, and customer onboarding. In addition to saving time and costs, RPA allows employees more time to focus on more strategic tasks, such as interacting with customers on a personal level, analyzing market trends, developing new commercial strategies and making decisions to keep the financial services provider competitive. Artificial Intelligence and Machine Learning: AI and ML technologies are fundamental to successfully implementing automation in the financial industry. These technologies can be used in various aspects of banking, including fraud detection, customer service, credit risk assessment and personalization. Banks should allocate resources for researching and developing in-house AI and ML solutions or partner with dedicated vendors to stay ahead in the swiftly evolving landscape. It is also important to note that all generative AI models should serve as assistive tools, not the sole decision maker. Digital Customer Experience: Building upon the importance of personalization, investing in digital customer experience becomes crucial. This includes implementing AI-powered chatbots for customer support, enhancing mobile and online banking platforms and leveraging advanced analytics for personalization. After a virtual assistant verifies the customer’s identity, a customer can communicate with these chatbots in real time and receive details on their accounts that would otherwise require human attention. Financial services can increase customer satisfaction, loyalty and revenue by prioritizing the digital customer experience.

•

Infrastructure Modernization: Legacy systems can slow down the adoption of automation. To overcome this challenge, financial institutions must invest in modernizing their infrastructure, including upgrading these legacy systems, embracing cloud-based technologies, and implementing API-driven architectures. Banks should prioritize seamlessly integrating automated solutions, such as AI-powered personalization tools.

•

Data Management and Analytics: Data is critical in automation and personalization. Banks should invest in robust data management systems and advanced analytics tools to make sense of all the data they collect. This will enable them to gain important insights, make informed conclusions, and improve the accuracy of their predictive models, leading to better personalization and customer experiences.

•

Collaboration and Partnerships: Banks should explore collaborating with FinTech startups and other technology providers to accelerate their automation journey. Leveraging strategic partnerships, banks can benefit from innovative solutions and expertise that may not be available within their organization, including speeding up time to market, diversifying their offering and enhancing customer experiences. This cooperative approach can help banks improve their AI and personalization tools, ultimately improving their ability to offer highly customized and responsive services to their customers.

Investing in these target areas will help banks automate their processes and future-proof their business in an increasingly competitive landscape. By adopting this roadmap, financial institutions can lower costs, enhance efficiency and deliver superior customer experiences, positioning themselves for long-term success.

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TECHNOLOGY

How to deliver trusted, safe, and responsible AI A working definition of Artificial Intelligence (AI) is that it is the ability of a machine to perform tasks regarded as requiring intelligence. Although not new, it is an idea which has suddenly become part of everyday conversation. This is largely because the power of modern computers, coupled with the size of databases that are now available, has led to remarkable achievements, with even more remarkable breakthroughs promised. These span all aspects of human enterprise: beating chess and go champions, making scientific and medical breakthroughs, real-time language translation, facial recognition, driverless cars, and so on. Most recently, the media have become enthralled by the potential of chatbots and large language models, such as ChatGPT, Claude 2, and PaLM. These appear to have the capacity to carry out a sensible conversation and even to write documents at a level adequate to pass university examinations. But two things about these developments are striking. One is the rate of progress. Every week we appear to read about an even more dramatic advance: whereas Chat GPT-3.5 outperformed 10 percent of human candidates on the Uniform Bar law exam, the improved Chat GPT-4 version beat 90 percent. And the other is that sometimes the systems make silly mistakes – like the early version of ChatGPT confidently asserting that 47 was larger than 64 (and then attempting to count from 47 to 64, before giving up). Put these two things together, and alarm bells might start ringing. Will AI take over jobs? Will it aggravate social inequality? Will it lead to disastrous mistakes? Who bears responsibility when things go wrong? What about autonomous weapons? Is what an AI system is trying to do really aligned with what we want; that is, is it solving the right problem? And even if it is, is it doing so in an ethical way? After all, hospital waiting lists are easily reduced by putting fewer patients on the list.

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In short, can we trust AI, is it safe, and how can be ensure that such systems are used to benefit humanity? Validate AI has been at the forefront of developing strategies to mitigate these risks since its formation in 2019. The risk mitigation strategy is based on six key pillars that could form an outline for businesses to follow to drive assurance: 1.

Scoping. This is the process of clarifying the problem to be solved, exploring the feasibility of a solution, looking at the appropriateness of AI to tackle the problem, and working out the steps needed to develop a solution.

Data preparation. As is well-known, distorted, incomplete, or inaccurate data can lead to mistakes or even disasters. The old adage “garbage in, garbage out” applies even more in a world of AI, which might be based on billions of data items and use very highly sophisticated algorithms. Time taken checking data is more than well-spent in terms of peace of mind that the system is doing what it is supposed to.

Algorithmic development. This involves more than simply building the algorithm. It includes testing and validating it. Key questions are asked at this stage such as, is the objective function optimised by the algorithm really the one we want to optimise? Are there bugs in the software which manifest themselves only in unusual conditions? If software packages are used, are we confident that their default settings are doing what we want?

Deployment and maintenance. AI assurance does not stop once the data has been captured, the system built, and the algorithm developed. Its performance needs to be evaluated, monitored, and audited. It is important to regularly check if it is performing well enough? How does it do when circumstances change – after all, the one thing we know about human society is that change is constant. What fall-back plans are in place should the system go down?

Legal requirements. It should go without saying that the system must adhere to data governance legislation and regulation. It is imperative to also consider whether there is adequate human oversight? What about security considerations? Is it resilient to attack and fraud attempts?

Ethical considerations. Is it discriminatory? Can decisions that are made by a system be explained and justified? Does it preserve privacy appropriately? Is the wider impact of the system on society, work, and wellbeing being considered?

TECHNOLOGY

In short, we are moving into a new world. It is a world of huge potential for benefitting humankind. However, as the recent gathering of leaders from around the world at the UK AI Safety Summit illustrated, the technology of AI, like any other advanced technology such as nuclear or biotechnology, carries risks. For its vast promise to be fulfilled, we need to tread carefully. The risk mitigation strategy embodied within the pillars above forms the basis of a checklist which will give us confidence that the future is bright. That safe AI can be delivered.

Shakeel Khan CEO, Validate AI Shakeel Khan is CEO of Validate AI, a community interest company championing innovation in how we deliver Trusted, Safe and Responsible AI, working with experts from Government, Academia and Industry. He has worked extensively in the banking and government sectors over 28 years leading the development of a comprehensive practitioner centric AI assurance tool kit. This has been adopted for projects by government departments and fiscal authorities globally. He also chairs an AI committee at the OR Society that partners with Validate AI to deliver community events and learning opportunities.

David Hand Emeritus Professor of Mathematics and Senior Research Investigator at Imperial College David J. Hand is emeritus professor of mathematics and senior research investigator at Imperial College London and Chair of Validate AI CIC. He a past president of the Royal Statistical Society and is a fellow of the British Academy. His books include Dark Data, The Improbability Principle, Information Generation, Intelligent Data Analysis, Artificial Intelligence and Psychiatry, and Principles of Data Mining.

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BUSINESS

How technology can help tackle unconscious bias in the workplace Implicit bias in the workplace is in approximately 20-30% of written communications – even in the most positive settings. Given that unconscious bias is unintentional, how can technology help organisations to address it and promote a more inclusive environment?

Navin ‘nuvs’ Jain Product Evangelist, Workhuman

If someone says, “I don’t think women are suited to leadership roles”, this type of overt bias is readily noticeable and can be confronted directly. But identifying and addressing implicit bias is much harder. Words that might seem neutral or even friendly in intent can sometimes have an offensive or negative impact. In fact, even in the most positive work environments, Workhuman research shows that about 20 to 30 percent of written communications show implicit bias. Because it is unintentional, it’s important to proactively identify and educate people about why specific statements may contain bias. This is where technology can play a crucial role in addressing and mitigating these biases. By combining machine learning and expert research and data on linguistic patterns, it’s possible for technology tools to recognise and highlight various forms of bias, and even offer tailored suggestions in real-time. This can help people steer clear of non-inclusive language in their written communications. Beyond once-a-year training sessions, what can organisations do to tackle unconscious bias? Annual training can be beneficial to help educate employees and teach them the skills to address bias in the workplace, but in order to effectively tackle unconscious bias, organizations need to make ongoing efforts that go beyond one-off workshops. On its own, infrequent training is less effective because it only offers a brief, isolated exposure to DEI topics. Organisations can tackle unconscious bias by implementing targeted and continuous strategies, such as providing employees with daily, in-the-moment learning opportunities that reinforce diversity, equity, and inclusion (DEI) principles.

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Workhuman has developed ‘Inclusion Advisor’ as part of the Workhuman Cloud® – a digital platform where employees can share recognition for people’s work contributions. Inclusion Advisor is an AI-powered micro-coaching tool that is integrated into our Social Recognition platform. This tool helps screen employee recognition messages to flag unconscious bias to the author and make suggestions to help improve inclusivity and promote ongoing learning. This tool enables employees to learn where their gaps might be in communicating in inclusive ways and prompts them to learn more about how their language is perceived and be more aware as they communicate and share recognition messages. Why was Inclusion Advisor developed by Workhuman and how does it work? Workhuman’s core ethos revolves around building workplaces where employees feel recognised, valued and empowered to be themselves at work, in turn driving an organisation’s strategic vision, growth, and success. Words matter, and inclusive and respectful language is an essential part of creating a culture of inclusion and belonging. Avoiding bias in workplace communications is difficult because implicit bias can be covert and even embedded in the phrases people use daily. The idea for Inclusion Advisor was born from a desire to examine workplace language, unpack unconscious bias, and empower people to communicate in an inclusive way. Even in the most positive of contexts, such as when people are sharing a message recognising a co-worker for a job well done, implicit bias can be present. Inclusion Advisor is a ‘smart assistant’ that flags biased phrases in written recognition messages, and provides specific, actionable advice, helping people write more inclusive, meaningful messages. In order for Inclusion Advisor to flag bias and make recommendations to improve recognition messages, the author has to proactively request coaching, making it a completely voluntary learning process that brings people into the act of using inclusive language.

BUSINESS

The technology uses Artificial Intelligence, Natural Language Processing and carefully crafted patterns as determined by a team of linguistic experts to classify the underlying sentiment of a message and provide personalised recommendations. Can you share some examples of the specific ways in which the Inclusion Advisor suggests rewriting language to be more inclusive and free of bias? Implicit bias can come in many different forms. For instance, ageist language is a common type of unconscious bias. In the message, “You may be old enough to be my grandpa, but you’ve still got it! Your experience helped us problemsolve the client’s issue”, Inclusion Advisor might suggest instead saying, “Your methods are tried and true, and you’re a remarkable teammate that helped us problem-solve the client’s issue.” Similarly, gender is another bias-prone area. When a message states, “Kate is a great role model for other women, and was so proactive and creative on the project”, it may suggest she is only able to impact those of her own gender. Inclusion Advisor might recommend more gender-neutral language, such as “Kate is a great role model, and was so proactive and creative on the project”. These recommendations don’t change the core message, but they can completely transform the impact. Instead of receiving a message that might be perceived as backhanded or biased, the recipient hears the author’s genuine intention: that their work is valued and their contributions are highly appreciated, fostering a more positive and inclusive environment. A correction like this doesn’t just mitigate the impact of unconscious bias for the message recipient; it has ripple effects throughout the entire organization. Workhuman’s Social Recognition platform comes with the option to make recognition moments public on the organization’s social feed so everyone can celebrate a job well done. Ensuring that the messages that make it out into your organization are free of unconscious bias is extremely important so that when reading messages colleagues have

exchanged, onlookers don’t come away with a negative opinion the author who may have inadvertently offended or put down the person they were trying to celebrate. Furthermore, it’s important they don’t hold the belief that their company would condone language or behaviour that jeopardized their employees’ sense of belonging. How receptive are people to addressing the issue of unconscious bias in workplace communications, particularly in written messages? In an initial Inclusion Advisor pilot, 75% of the time, employees changed language identified by Inclusion Advisor as biased in their written recognition and reward messages. This suggests that people are highly receptive to making corrections that reduce biased language and improving their language awareness to enhance inclusivity and reduce bias in the workplace. Can you share any success stories that demonstrate the positive impact of addressing unconscious bias in written communications in the workplace? Organisations using Inclusion Advisor have seen measurable results. Pharmaceutical company, Merck found that over a six-month period, 74% of Merck employees chose to change their recognition message after Inclusion Advisor flagged potentially biased language. Participants reported that Inclusion Advisor not only influenced their recognition messages, it also positively affected their interactions in other areas. Likewise, during LinkedIn’s pilot launch of Inclusion Advisor with 1,500 employees across the globe, employees appreciated the automatic feedback, sending out 5,500 recognition messages during the pilot. About 22 percent of these messages used Inclusion Advisor. Based on the number of employees who sent recognition messages during the pilot, it’s estimated that more than 20,000 awards each year could be made more inclusive in their language.

What role does combatting unconscious bias play in talent retention and competitiveness in the marketplace? Internalised stereotypes and biases about different groups can negatively impact how people relate to one another and people’s sense of belonging and inclusion in the workplace. Combatting unconscious bias isn’t just the right thing to do, it helps organisations achieve better business success. According to Gartner research, inclusive, genderdiverse teams outperform less inclusive ones by 50% on average, and three out of four organisations with diverse decision makers will exceed their financial targets. Additionally, employees in diverse and inclusive workplaces tend to be significantly more emotionally invested in their organisation, with Catalyst research showing that 35% of worker’s emotional investment and 20% of their desire to stay at a company is linked to feelings of inclusion. And given that 72% of workers say that DEI is important in their decision to stay with their organisation, it’s clear that tackling unconscious bias is crucial to retaining talent. Implicit bias and the road ahead Inherent biases can inadvertently harm others, and new technologies like Inclusion Advisor are paving the way for more awareness of it and more inclusive workplaces. By flagging these biases and suggesting alternatives in a natural and voluntary way, employees are given opportunities to learn in real time. Many employees report that this microcoaching influences their language more widely, in their emails or chats with colleagues overall, and even in discussions outside work. As AI’s capabilities continue to grow, tools like Inclusion Advisor, which are integrated and in-the-moment, are likely to become increasingly common.

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BANKING

Four ways payments will change in 2024 – Pay By Bank, digital footpaths, loyalty and insights With every passing year, fresh trends emerge, and existing ones gain momentum. New possibilities in payments, changing consumer habits and an ever-evolving economic landscape combine to constantly evolve and revolutionise the ways we conduct transactions, manage our finances, and how we choose to interact with money itself. In this era of fast-paced technological innovation, forecasting the on-going trajectory of payments innovation requires us to keep focus on emerging trends and shifting consumer and retailer habits. As we head into 2024, it’s imperative that retailers examine where true operational efficiencies can be made, especially in the case of where these savings can be passed on to customers. To prepare in the way that’s best for them, retailers need to know what lies ahead. Here we explore the top payments trends for the year ahead, with an eye on how they’ll impact retailers and consumers alike. In-store Pay By Bank goes mainstream The arrival of Pay By Bank, a new alternative payment method (APM) that allows consumers to pay for goods and services in-store via an account-toaccount transfer, is already seeing growing traction among retailers. Building on consumers’ desire for convenience and security, Pay By Bank payments involve shoppers simply scanning a QR code and automatically opening a mobile banking app to authenticate and authorise payment. For retailers, Pay By Bank’s lower transaction fees make it especially appealing and why it is likely to cement itself as a favoured payment by the end of the 2024. Furthermore, there’s no need to clutter payment devices with third-party apps as no additional downloads for Pay by Bank to work are required. App-based, Pay By Bank can also easily be linked to loyalty schemes and tailored offers to encourage shoppers to make repeat purchases. Digital footpaths break into the boardroom Digital payments like Pay By Bank, smart speaker payments, and biometric authentication are creating a wealth of interconnected payments and customer data. Once solely used by customer experience (CX) teams, these digital footpaths will become mission critical in 2024, with many retail businesses leaning heavily into the insights provided. Hurried up the boardroom agenda, retailers will use these digital footpaths to identify and realise new areas of business growth – essential in today’s economic climate and as the cost-ofliving crisis continues to bite for consumers. From new product offerings to launching new channels and even where to open new stores, digital footpaths will provide the most valuable insights to retailers in 2024.

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Loyalty dies Although the Bank of England expects inflation to slow, it does not believe it will be back to normal levels of around 2 percent by at least the end of 2025. Consumers will continue to feel the pinch, likely killing brand loyalty. According to research by McKinsey, around half of consumers reported switching brands in 2022, compared with only one-third in 2020. More worrying for retailers, about 90 percent said they’d keep changing. With the cost-of-living crisis set to roll on, loyalty will die as customers search for lower prices, exclusive offers, and a better CX. As a result, brands will need to double down on the personalisation of offers through insights and payment data if they are to retain customers.

BANKING

Retailers cash in on data Next year will see the retail business model flipped on its head. Building on the success of using customer data and analytics to deliver tailored and personalised experiences for their own customers, retailers will also accelerate selling access to their treasure trove of data to advertisers, suppliers, and brands. By the end of the year, reports of retailers generating up to a third of their revenue from selling data to marketers and others seeking access to consumer spending insights will emerge. Keeping pace with change can test even the most organised and forward thinking of retailers. What was a new trend today, may not be tomorrow. However, constantly evolving, and rethinking payments is essential to help make efficiencies and savings. Crucially, to do this, retailers need to seek the right partners to help them focus on the specific challenges that lie ahead for their business and how they can best adapt to be in a stronger position. From a better CX to the identification of new markets and opportunities for growth as well as a stronger cash flow, the benefits are clear. As we head into 2024 those who persevere and prepare will be best set to realise these wins and navigate the waters ahead

David Maisey CEO of MultiPay Global Solutions

Issue 58 | 15

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2024

TECHNOLOGY

Lead like superheroes and embrace AI Businesses need to change the perception of AI from being the ‘villain’ to the invisible superhero that will augment employees’ roles and create more jobs. McKinsey Global Institute estimates that as early as 2030 AI could contribute to the creation of 20 million to 50 million new jobs globally. Leaders need to change strategies, look at where and why they need AI, redeploy resources, and focus on re-skilling and educating employees on AI. Leading like superheroes and empowering their team for transformation. Stronger Together

Jonathan Sharp CEO, Britannic

AI possesses extraordinary powers to transform with its superhuman characteristics such as exceptional speed, invisibility, agility, and genius level intellect beyond human capability. They are more akin to superheroes than villains. Yes, AI can read and interpret data, predict trends and patterns, generate content, become your co-assistant, the list goes on. But it cannot do what humans do best, which is to form strategic, critical thinking, make emotional, rational, creative, and ethical judgements and decisions borne from human intuition. By blending humans and AI together to act for good then you really do have a true superhero with superhuman powers to transform and improve the workplace forever! “The only way to win is together,” Iron Man. Know Your Mission Superheroes set out to make the world a better place, knowing what their mission is before they commence, understanding what their objectives are and seeing the end before they begin. Businesses need to know where in their organisation they want to deploy AI, why and what they want to improve, and what is the success criteria to measure the success of the project. Whether that’s driven by costsavings, increasing productivity or efficiencies, or improving the employee or customer experience. This can be an overwhelming task, so it is advisable to work with a consultative technology partner to work closely with you on your plan and the deployment of the solution.

“Part of the Journey is The End” – Tony Stark.

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TECHNOLOGY

Leading with a Superhero Mindset The deployment of AI requires the management team to fully advocate it and communicate to the business how it will benefit them and deliver improvements all round. They should lead like a Superhero by empowering and supporting employees through the change. Empower and involve employees in designing an AI solution helping to reduce the fear factor by understanding how they think AI can improve and facilitate their roles and what challenges they are experiencing. By involving them from the offset you will get buy-in which will contribute to the success of the project. Your Solutions Provider can assist you in reengineering processes and helping you design an AI solution to meet your objectives, whether that’s a chatbot, data entry and processing, email filtering, data analysis or admin tasks such as organising calendars, writing reports, or managing logistics. “With great power comes great responsibility,” Peter Parker, Spiderman. Collaborating and Transparent Culture Businesses need to welcome and champion AI communicating how change is a good by fostering a culture that is transparent, honest, providing the space for employees to make and learn from their mistakes and suggest new ideas and concepts. AI reveals data insights where employees can identify areas that need improving or changing or spotting new areas to offer new products and propositions. Humans excel in critical thinking and reasoning and have the creativity and imagination to come with up solutions that AI cannot do. Encourage your employees to down tools and stop and think, cultivating a creative culture that presents them with the opportunity to suggest new ideas and improvements. “Our greatest glory is not in never falling, but in rising every time we fall,” Batman. Integrity and Equality Superheroes are honest with great integrity and are trusted by citizens. It is vital to act with integrity and equality when deploying AI ensuring that your solution ethical and contains no biases and if issues arise, they must be amended immediately so you have agency and transparency.

“There is a right and a wrong in the universe and that distinction is not hard to make,” Superman. Learning and Growing AI is new and with all new things we must learn them. Ensure you and your employees are trained in using the AI by providing ongoing education and training sessions, allocate mentors and champions to support and help it roll out. Give them the time to play around with AI, practicing, and testing it out, be patient this will take time. “I think a hero is an ordinary individual who finds strength to persevere and endure in spite of overwhelming obstacles.” – Superman. Forever Transforming Through transformation and growth Superheroes are made and an AI deployment is an evolutionary process where humans and AI learn and grow together. Emphasis to your employees that it’s OK to make mistakes when practising and using the AI solution. When we fail, we learn and grow from our mistakes. By testing out AI and learning collectively you will become more comfortable on how to use the new solution and be confident on the benefits it delivers. Resulting in translating the business needs into system design and making what you thought was impossible possible all with the help of your Solution Provider. “You’re going to make a difference. A lot of times it won’t be huge, it won’t be visible even. But it will matter just the same.” James Gordon, Batman. Superheroes Unite AI and humans are the superheroes of the world of work today demonstrating superhuman powers to solve real business issues. AI can analyse and interpret masses of data at a speed and scalability that is not possible for humans, and employees can then take this data and make intelligent creative business decisions that transform processes or the employee and customer experience. AI should no longer be seen as a complex or scary villain but as an invisible superhero that provides superhuman powers behind the scenes. Human employees will learn how to collaborate with their AI assistants utilising their superhuman powers to make their role easier and more fulfilling and transforming the workplace making the impossible possible. “We’re better together,” Captain America.

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BANKING

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BANKING

The bank of the future Humans have always pushed boundaries. From searching for new worlds in the 15th century to exploring new planets today, the human race is constantly seeking change and innovation – and that’s no different in the banking world. Powered by the rapid development of technology, the banking sector has, and will continue, to change and evolve. In this era of digital transformation, banks are leveraging cutting-edge technologies such as artificial intelligence, blockchain, and data analytics to enhance their services. These innovations are not only streamlining banking operations but also creating a more personalized and responsive banking experience for customers. The all-pervasive technology layer continues to evolve, with the emergence of decentralized finance (DeFi) and open banking initiatives, which further empower customers by giving them more control over their financial data and allowing them to access a wider range of financial services. As customers increasingly expect seamless and convenient banking solutions, banks are harnessing the power of automation and datadriven insights to provide tailored financial products and services. The advent of mobile banking apps, chatbots, and virtual assistants has brought banking services closer to customers’ fingertips, making it easier for them to manage their finances on the go. Customer centricity lies at the heart of banking and the future of banks hinges on the industry’s ability to personalize services and embrace technological innovation.

Generation Alpha Historically, banking has been the backbone of commerce, from trading in Renaissance Italy to the complex financial tools of today. The core mission remains the same, but the means and mechanisms are evolving. In 2024, banks are redefining their role, aiming to serve not just as financial centers but as holistic platforms developed specifically for customer engagement. The rise of Generation Alpha, those born from 2010 onwards, signifies a new chapter in consumer behavior. Generation Alpha will demand the most from the banking system, more than previous generations, over the next few decades and their sheer affinity to technology will force banks to utilize technology like they do and provide a technology first service that caters to their specific financial needs. This generation’s familiarity with digital technology shapes their expectations of banking services. They seek platforms where transactions are not just transactions but experiences— seamless, immediate, empathetic and integrated into their digital lives. To cater to this tech-savvy generation, banks must harness the power of data analytics and artificial intelligence (AI) to offer real-time, context-aware services. The concept of a static credit rating, for instance, is becoming outdated. Instead, dynamic credit assessments at the point of sale will become the norm, allowing for more accurate and immediate financial decisions. Credit assessments are no longer just transactional but take into account people’s social behavior and moral values as highlighted by China’s new social credit law. Credit must become contextual.

The principles of intuitive design, intelligence, and individualization are key to the future of banking. Financial advice, once the realm of human experts, is being augmented by AI systems that can provide personalized financial plans with minimal human oversight. The goal is for banking services to anticipate customer needs and offer tailored solutions without the customer having to ask. Technology first approach and digital collaboration Technological infrastructure is critical in this new era, and the concept of convergence plays a pivotal role. With 5G technology, banks can offer not only faster but also exceptionally reliable services, ushering in a new era of seamless connectivity. This convergence of high-speed data transmission, the Internet of Things (IoT), and advanced analytics is just the beginning of a transformative wave of innovations that will continue to redefine the banking experience. As these technologies converge, they create a powerful collaboration that enables banks to provide customers with real-time, personalized, and context-aware financial solutions. This convergence isn’t limited to just connectivity; it extends to the integration of various financial services across all industries, such as banking, payments, insurance, and investments, all accessible through a unified digital ecosystem. As a result, customers can expect an unprecedented level of convenience and efficiency in managing their financial affairs, setting the stage for a banking landscape that is more interconnected and customer-centric than ever before.

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BANKING

For example, ride sharing apps, where payments are automatic, demonstrate the developing partnership between the banking and transport industry. In the Shared Rides market, the number of users is expected to amount to 3,467.00m users by 2027 and revenue is projected to reach US$429.10bn in 2023. Ride-sharing apps have fundamentally changed the way we pay for transportation services. Gone are the days of searching for the nearest ATM before a ride. Instead, passengers can link their bank accounts or credit cards to these apps, allowing for automatic and cashless transactions. This integration not only simplifies the payment process but also enhances security. The ecommerce world is also working increasingly closely with banks. Amazon, for instance, has ventured into the financial services realm by offering cobranded credit cards and even exploring the concept of Amazon-branded checking accounts. These financial products not only deepen Amazon’s engagement with its customer base but also position the company as a significant player in the financial sector. Moreover, Amazon Pay has extended its reach beyond Amazon’s own platform, allowing customers to make payments on other e-commerce websites, thereby expanding its influence in the digital payments space. We can anticipate further integration of banking services within the e-commerce ecosystem, blurring the lines between shopping and banking. As digital wallets, artificial intelligence, and blockchain technology continue to advance, customers may enjoy more personalized financial recommendations, flexible payment options, and enhanced security measures. Ultimately, this evolving collaboration is poised to reshape the way consumers shop and manage their finances. The same applies to other sectors, including the food and beverage industry. Traditionally, the collaboration mainly revolved around payment processing in restaurants and food delivery services. However, we’re now seeing the integration of biometric authentication

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methods, such as fingerprint recognition, into the payment process. The recent association between Mercedes and Mastercard, which offers fingerprint authentication for vehicle purchases, is just one example of how this technology is being utilized. This advancement opens the door to a future where customers can seamlessly and securely purchase groceries or dine out using biometric data, such as their fingerprints.

Fintech companies specialize in crafting user-friendly, digital-first experiences that resonate with today’s tech-savvy consumers. Traditional banks are leveraging this expertise to revamp their legacy systems, moving away from cumbersome, paper-based processes toward agile, digital platforms. This transformation streamlines operations, reduces costs, and enhances the overall customer experience.

As technology continues to advance, we can anticipate further integration of biometric authentication across various touchpoints in the food and beverage industry. This could include fingerprint-enabled payment terminals in restaurants, selfcheckout options at grocery stores, and even biometrically secured food delivery services. These innovations not only enhance security but also streamline the payment experience, making it more convenient and efficient for consumers.

Furthermore, fintech partnerships enable banks to tap into cuttingedge technologies such as artificial intelligence (AI), blockchain, and data analytics. These technologies empower banks to offer more personalized services, real-time risk assessment, and efficient fraud prevention. As a result, customers benefit from quicker loan approvals, tailored investment recommendations, and enhanced security measures.

At the end of the day, banking becomes omnipresent. Fintech collaboration The collaboration between banks and fintechs represents a pivotal shift in the financial services landscape. Banks, often burdened by legacy systems and traditional operational models, find themselves in need of significant digital upgrades to seamlessly integrate with the agile, tech-driven approaches of fintech companies. This integration pushes banks towards modernizing their IT infrastructure, adopting cloud computing, enhancing data analytics capabilities, and embracing open APIs for better interoperability. Meanwhile, fintechs must align with the stringent regulatory and security frameworks typical of the banking industry. This convergence not only accelerates the pace of innovation in financial services but also demands a cultural shift within traditional banking institutions, fostering a more collaborative and customer-centric approach.

While there is ample reason to be optimistic about these collaborations, true success hinges on cultural synergy and the alignment of organizational outlooks. The recent divorce between Apple and Goldman Sachs, highlights the importance of aligning not just in terms of technology but also in terms of values and strategic vision to create a lasting and fruitful partnership. Looking ahead The banking sector’s transition is underpinned by a shift from traditional profit models to ones focused on customer outcomes. Banks are looking beyond the spread between deposits and loans to measure success by the holistic value they provide to customers. This includes offering an integrated platform where banking, commerce, and lifestyle services converge seamlessly.

HEADER

Banks are now expected to operate as agile entities, adapting to changes in customer behavior and technology. The bank of the future is customer-centric, transparent, data-driven, and adaptable. It must be ready to evolve its services in real-time, always prioritizing customer needs. The models shaping the future of banking consist of three layers: a customer-centric approach at the top, innovative, flexible and agile products in the middle, and everchanging robust technology as the foundation. This will drive the banking sector forward, with the potential to create a banking experience that is as natural and intuitive as the world around us. As banks embrace this transformative model, they are paving the way for a future where banking is not just a service, but a personalized journey towards financial empowerment and wellbeing.

Nanda Kumar CEO, SunTec Business Solutions

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INTERVIEW

Embracing Change: NICE Actimize on Generative AI, Cloud and the Future of Financial Crime

Readying the launch of new solutions that focus on the benefits of generative AI, Craig Costigan, NICE Actimize CEO, discussed with Global Banking & Finance Review Editor Wanda Rich what lies ahead for global financial institutions as they address transformation created by the collision of new technologies, increased regulation, and heightened challenges brought by emerging fraud typologies and increasing sanctions. As the industry leader in financial crime and compliance solutions and a pioneer in AI, machine learning, and collective intelligence, NICE Actimize delivers solutions that leverage innovation to mitigate risk, empowering clients to comply with confidence. Focusing on these differentiators, Costigan offers a sneak peek into his organization's plans and outlines the steps financial institutions must consider to be successful in 2024. As we launch a new year, financial institutions are dealing with decisions regarding significant shifts in how their operations and businesses are run. What critical changes impact financial institutions that require unique strategies and focused management decisions? Costigan: This year marks a perfect storm – from movement to the cloud to the emergence of nextgeneration technology targeting efficiency and speed to how a culture within a financial organization will have to change to accommodate these shifts. The transition to the cloud continues to create a need for a fresh look at the operational strategies that financial institutions have embraced. As financial institutions move from traditional legacy systems to cloud-based, they take a huge burden off their IT staff with a SaaS solution. The SaaS approach provides speed and scale that can adapt – the endless power of compute comes with the cloud. That means you have the operational ideals to be agile and change your sanctions programs quickly, as one example. Now, you have the speed and agility to get it done because you can shift quickly when necessary. We have seen tremendous success in our cloud business because of these benefits.

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Q: Creating the infrastructure needed to accommodate modern AI systems may seem a tall order. Where should financial institutions begin their assessment journey? Costigan: It isn't a tall order if you don't go it alone. We are seeing many organizations move to a SaaS solutions environment -- a world-class software provider can lead you efficiently to where the provider handles all of the infrastructure. This is the optimal way that proves to be more cost- and timeefficient – for example, you won't have to source hardware or search for microservices. Q: What role will Generative AI play in transforming financial crime this year? Can you name a few use cases you see assisting financial institutions in reducing time to value, lowering costs, and meeting regulatory compliance requirements more effectively? Costigan: Generative AI is a positive force to be reckoned with – anti-money laundering applications and fraud and market manipulation scenarios will all benefit from the cost savings that generative AI will usher in. I think generative AI will bring numerous targeted benefits to the applications and use cases they serve.

INTERVIEW

In the fraud area, an essential factor to keep in mind is that criminals of all types have already added generative AI capabilities to their bag of tricks. They have become experts at creating new obstacles for financial institutions and targeting customers with scams, account takeovers, and identity theft. From AI-generated selfies, fake documents, such as bank statements or government letters, cloning a person's voice, or generating deepfake videos to engage in phishing or blackmail, criminals have created many ways to fool consumers and businesses.

We are leveraging AI to help institutions evolve financial crime and compliance team roles, focusing on strategy and oversight while AI handles the heavy lifting and manual tasks.

Q: What are NICE Actimize's plans for new solutions launches this year in generative AI? Costigan: NICE Actimize is stepping up with aggressive plans in the area of generative AI, and we will launch several generative AI solutions early this year, already leading the industry with several patents pending that address this space. One of the first offerings will be Generative AI for Suspicious Activity Reports (SARs), which shows where generative AI can provide value in regulatory compliance. Financial institutions must file SARs with regulatory bodies when they detect suspicious financial activity. However, the current process for filing SARs is manual, time-consuming, and error-prone. Generative AI can automate the generation of this narrative by providing clear, concise, and compliant written summaries of the suspicious activity. This automated approach streamlines the SAR filing process and ensures accuracy and consistency. This will provide significant time savings while reducing the risk of regulatory penalties and reputational damage.

We will also provide a way for analysts to start smart – it will summarize the issue to be investigated and recommend the next best actions throughout the process to complete an investigation. This approach will provide significant time savings for financial crime investigation teams. Q: How does NICE Actimize's strength in artificial intelligence impact the firm's approach to data management? Costigan: Today's availability of extensive third-party data sources can make gathering data time-consuming, introducing the risk of errors when manually collecting information. Advanced AI makes the data-gathering process faster and more effective. Our AI-powered data intelligence offerings aggregate and orchestrate the collection of data, making it seamless and quick to access for financial crime teams to confidently assess the risk of a customer and make the right decisions. In addition, we leverage this intelligence to create consolidated entity profiles for faster decisions. Q: What additional differentiators allow you to support financial institutions through these challenging times? Costigan: Our robust analytics and AI capabilities position us well, providing insights from across the industry and injecting new features into models to stop emerging threats. We also fully support model governance to ensure standards are met before live production. As we have seen fraud grow by double digits, our broad and deep Enterprise Fraud Management (EFM) coverage addresses all possibilities: New Account Fraud, Mule Detection, Scams and Authorized Fraud, Account Takeover, and Login & Account servicing. Our scalable, flexible, and high-performing real-time fraud prevention and management platform has already been proven with the largest Tier-1 financial institutions. And our strong install base in Tier-2 and Tier-3 financial institutions further demonstrates our platform's ability to scale up and down based on segments, use cases, and regional needs. In transaction monitoring systems, NICE Actimize's AI/ML-based advanced segmentation, tuning optimization, and predictive analytics have enabled customers to achieve increased efficiencies in their AML programs. Customers adopting these models have consistently seen a 40% reduction in false positives while maintaining a 100% accurate positive recall. Q: What is NICE Actimize's most significant accomplishment this year? Costigan: While I am proud of so many accomplishments, the patents pending and patents granted for our AI inventions are world-class and indeed show that we are going after innovation full force to solve financial crime in new ways. Coupled with our extensive investment in research and development, this pairing has guided us to deliver solutions that will provide financial institutions with the competitive differentiators they will need to fight financial crime today and tomorrow.

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FINANCE

Insurance Predictions As we edge closer to 2024, the global insurance landscape is poised for a transformation driven by technological advancements, evolving customer expectations, and changing regulations. Here’s a look at some key predictions shaping the future of insurance, backed by insightful statistics. Technological Integration and Automation: The insurance industry is rapidly leveraging technology to streamline operations and improve customer service. A key component of this technological shift is the integration of artificial intelligence in claims processing. According to the Sciencesoft report, using AI in insurance claims has the potential to cut claim resolution costs by as much as 75%. This significant cost reduction is accompanied by a faster claim cycle, expected to be 5–10 times quicker due to intelligent process automation. This not only speeds up claims handling but also enhances the accuracy and efficiency of the entire process. Cyber Insurance Boom: In response to escalating digital threats, cyber insurance is transitioning from a specialised offering to an essential product. The rise in cybercrime and associated claim costs is driving this trend, as more businesses fall victim to attacks and consequently seek cyber insurance for risk mitigation. The FBI’s 2022 report highlighted over US $43

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billion lost in business email compromise attacks since 2016. Reflecting the heightened awareness of these risks, the cyber insurance market is projected to hit $40 billion in premiums by 2033, underscoring the critical need for such coverage in today’s digital landscape.. Customer-Centric Models: Today’s consumers expect services that are both personalised and convenient. In response, the insurance industry is increasingly adopting customer-centric models. Mendix reports that 85% of insurers are actively developing new Customer Experience (CX) initiatives to enhance customer journeys. When insurers provide personalised services, their customer retention rate reaches 81%. By utilising customer data, these models can offer tailored insurance policies, making their services more accessible and better aligned with individual customer needs. Regulatory Compliance and Sustainability: Regulatory compliance remains a top priority in the insurance industry, with more than 50% of insurers planning to boost their investment in regulatory technology (RegTech). This investment is estimated to exceed $204 billion by 2026. Simultaneously, the industry is making significant strides in sustainability, expecting a rise in Environment, Social, and Governance (ESG)-compliant investment products, indicating a strong move towards responsible and sustainable practices.

FINANCE

The Rise of Insurtech: Insurtech startups are revolutionising traditional insurance models with their innovative approaches to longstanding challenges. The global insurtech market, valued at USD 8.8 billion in 2021, is forecasted to reach a market size of USD 166.4 billion by 2030, growing at a CAGR of 39.1% from 2022 to 2030. This significant growth in funding highlights the market’s increasing demand for digital-first insurance solutions and platforms that focus on improving customer engagement. Health and Life Insurance Expansion: In the wake of the pandemic, there’s a renewed focus on health and life insurance. The sector is projected to grow by over 10% annually , reflecting an increased awareness of health concerns and the importance of financial security. Tailored health and wellness plans are becoming increasingly popular, signifying a shift towards preventive care models. Conclusion: As we analyse these statistics, it’s clear that the insurance industry is at a pivotal point of transformation. Insurers who embrace technological innovation, prioritise customer satisfaction, adhere to regulatory changes, and invest in sustainable practices will be well-positioned to thrive in 2024 and beyond. The future of insurance is dynamic, and with the right strategies, companies can turn these predictions into profitable opportunities.

Janthana Kaenprakhamroy Founder and CEO of Tapoly Janthana Kaenprakhamroy was listed by Forbes as number 6 of the Top 100 Women Founders to watch, and among the Top Ten Insurtech Female Influencers according to The Insurance Institute. Recently she has been named as one of the Most Influential Women in Tech 2023 and as the winner of Insurance Leader of the Year by Women In Finance Awards 2021. She was a former chartered accountant and internal audit director at investment banks, having previously worked at UBS, Deutsche Bank, JPMorgan, and BNP Paribas.

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INTERVIEW

Absa Bank: Achieving Benchmark Status in Mozambique Mozambique, with its abundant development opportunities and undeniable agricultural potential, is a strategic focus for various financial groups in Africa. Geographically, it serves as a crucial logistics hub on both national and regional levels and offers extensive investment possibilities, spanning public infrastructure, industrial production, mechanised agriculture, the oil and gas sector, and more. Following Mozambique's independence in 1975, Absa emerged as the primary banking force in the country. Throughout its history, the bank has consistently evolved, retaining its core values of quality, excellence, responsibility, integrity, and professionalism. Through its dedication to these values, Absa is positioned to play a pivotal role in Mozambique's continued economic advancement by providing services that support key sectors vital to the country's development. In this dynamic landscape, Absa's commitment extends beyond borders, as it remains an eligible partner for international companies seeking opportunities in Mozambique. Notably, Absa is among the few banks with a presence in all of Mozambique's 11 provinces. With over 30 years of experience in the banking industry, Pedro Carvalho has been the Chief Executive Officer of Absa Bank Moçambique since September 2022. He joined Absa in Mozambique, then under the Barclays brand, in 2014 as the Chief Operating Officer. In 2018, he was appointed as the Director of Retail and Business Banking, a role that he assumed until being designated CEO. When Pedro spoke to Global Banking & Finance Review, he provided significant insight into the strength of the infrastructure within which the bank operates and the emphasis it places on leadership and a positive work culture. “When it comes to guiding our actions and behaviours at Absa Bank Moçambique, we take our institutional values very seriously: trust, resourcefulness, stewardship, inclusion and courage,” he revealed. “We proudly position ourselves as champions of diversity and inclusion in the workplace. Our commitment is evident through various projects that encourage co-creation across different business units, bringing diverse perspectives to the table.” While this collaborative approach provides a way to ensure that all the bank’s services are designed to meet clients' unique needs, it also extends to the internal team. “Before addressing client needs, we prioritise adding value to our employees' lives through a work culture that emphasises wellbeing and sustainable production. As a financial institution, we take pride in maintaining a hybrid work model, allowing employees to disconnect from the corporate environment and work from home, thus fostering flexibility, productivity and employee satisfaction. Regular surveys are conducted to gauge employee sentiment and identify areas that are essential to their satisfaction and growth.”

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Pedro credits this strong emphasis on work-life balance as a significant contributor to Absa’s institutional growth as well as to the creation of a conducive space for its employees’ development. “Our ongoing efforts are geared towards promoting a diverse and inclusive work environment, caring for both the mental and physical health of our team, and fostering a healthy balance between personal and professional life. As a universal bank in Mozambique, we provide ample opportunities for individual and collective growth through career progression programs, a non-discriminatory policy, and seamless mobility within the internal sectors of the bank.” Initiatives such as the ICAS program (mental, economical, and legal counsel to all staff) and Sports After Work have been created and implemented to enhance employee well-being, while the bank’s main offices feature designated spaces for meditation and prayer, complemented by flexible working policies designed to reduce stress in the corporate environment. “Throughout all business areas, leadership initiatives abound to encourage team interactions,” Pedro said. “From team-building activities to social gatherings, these efforts strengthen employee connections and have a positive impact on overall productivity." “While we continue to champion worklife balance, we also recognise the importance of metrics. Employee surveys, productivity statistics, and testimonials affirm the success of these programs in enhancing satisfaction and productivity, further solidifying our commitment to a thriving and balanced workplace.” Given that talent acquisition and development play such a crucial role in the banking sector, Pedro explained that transparency ranks high as a priority in the bank’s selection processes in order to foster trust, promote equal opportunities, and draw the best talent.

INTERVIEW

“At Absa Bank Moçambique, we recognise the paramount importance of a robust talent attraction and retention policy. Renowned as a hub for cultivating excellence, we take pride in our role as educators, training and nurturing outstanding professionals. In our commitment to retention, we endeavour to instil in each professional the core values and a positive perception of leadership positions. We provide the necessary support for their work, offer ample development opportunities, and maintain an organisational structure and processes that facilitate an agile and efficient workflow.” In terms of community involvement and corporate social responsibility, Absa Bank Moçambique has shown itself to be dedicated to making a meaningful contribution to the communities it serves. “Our commitment to CSR is deeply ingrained, and we actively support social, environmental, educational, and cultural initiatives in Mozambique, aligning

with our broader citizenship strategy,” Pedro said. “One notable initiative is our support for local artists, whereby we provide them with a platform in the market and promote their work through various cultural programs across the country.” Other CSR-led endeavours include support for national blood banks, orphanages, and other impactful community actions. “Our contributions are designed to positively impact the lives of individuals in the communities we serve. Furthermore, we encourage and finance initiatives led by our staff, promoting social engagement and support within those communities. Our overarching purpose, 'Empowering Africa’s tomorrow, together... one story at a time,' reflects our commitment to sustainable development. As we move forward, Absa Bank Moçambique remains steadfast in its dedication to community development and making a positive impact, one initiative at a time.”

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INTERVIEW

In line with Absa Bank Moçambique’s robust efforts towards diversity and inclusion in the organisation, and the financial sector as a whole, Pedro described gender equality and women's empowerment as “paramount priorities,” evidenced by its proactive initiatives to create an inclusive workplace. “We go beyond mere rhetoric, offering equal opportunities internally and achieving commendable figures that position us as advocates for gender balance,” he explained. “At the core of our commitment is a 50-50 gender representation on our Country Management Committee, a tangible example of our dedication to diversity and inclusion. Our commitment extends beyond structural representation, with numerous women ascending to prestigious positions based on their work, dedication, and merit.” He cites the increasing presence of women in decision-making roles as being central to the bank’s initiatives, a focus that has led to the assurance of pay parity between genders and the availability of flexible work options. “We champion partial or full home office options, particularly for women and mothers, to facilitate a better balance between their personal and professional lives.” Actively listening to employees to understand their needs and challenges has been a major factor in developing the balanced working environment the bank enjoys today. “Active listening is ingrained in our culture, allowing us to adapt and respond to the evolving needs of our workforce,” Pedro went on. “Our commitment to gender equality is not just a statement; it's a lived reality, and our success is reflected in the growing prominence of women in leadership positions at Absa Bank Moçambique.”

“These programs have experienced consistent annual growth in applications, a testament to the invaluable contribution they make to human capital development and the training of young minds,” he reported. “Rooted in principles related to self-growth and financial education, Absa Bank's initiatives continue to shape a promising future for the next generation."

Equally important to the organisation is the nurturing of young talent in the financial sector. Absa Bank Moçambique’s commitment to youth development is demonstrable through its Ready to Work and Graduate Program initiatives, which serve as catalysts for knowledge and know-how, offering opportunities to enhance the employability prospects of young individuals in a competitive market. These programs exemplify Absa's dedication to preparing the next generation for success, and Pedro spoke about the transformative impact they have had.

“The Graduate Program serves as a powerful tool, providing young individuals with a gateway to the corporate world. It equips them with practical skills, an understanding of banking operations, and the development of professional abilities. Similarly, the Ready to Work program focuses on training young people in essential skills and techniques for active job searching, along with behavioural skills crucial to employability and career progression."

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INTERVIEW

“The success stories emerging from these programs underscore the profound impact they have on youth development, paving the way for a future generation that’s well-equipped for the demands of the financial sector.” Another pivotal consideration in modern banking is sustainability, and Absa Bank Moçambique has shown itself to be at the forefront of integrating environmentally-conscious practices into operations to contribute to the sustainable development of the country. “Embracing the belief that the future of Mozambique should be intertwined with innovation and sustainability, Absa Bank Moçambique has made substantial strides in this direction,” Pedro said. “This year , we demonstrated our commitment to the planet's future by inaugurating our first environmentally-friendly branches, harnessing solar energy to power our operations across various locations. Within our work environment, we are intensifying our commitment to digitalisation, aiming to significantly reduce paper usage." “Our focus on small businesses and emerging sectors, particularly renewable energies, is designed to stimulate creativity while respecting the ecological balance of a continent rich in natural resources.” Guided by the United Nations’ 17 Sustainable Development Goals, he revealed, Absa Bank Moçambique aspires to become the 'greenest’ bank in the country in the coming years. “Sustainability is not just an external commitment but is intrinsic to our operations and has been a focal point for several years. The principles we champion include clean transport, rational use of water resources, sustainable exploitation of natural resources, energy cost reduction, digitalisation to minimise paper consumption, mechanised agriculture, sustainable environmental management, promotion of clean energies, and carbon emission reduction."

“Recognised across the country, these programs are regarded as effective employability tools that extend beyond training,” he continued. “They offer vital support during the critical transition from academic life to the professional world. Numerous young participants have not only acquired skills but have also successfully joined the ranks of Absa Bank Moçambique's staff. Beyond our organisation, these initiatives empower young individuals to pursue diverse job opportunities in the market, encompassing technical, professional, and behavioural components."

“We also recognise the importance of considering environmental metrics in financing decisions, ensuring projects align with sustainability goals,” he added. “Absa Bank Moçambique remains dedicated to preserving and caring for the environment at every level of our operations, with a vision to lead the financial sector in sustainable practices for the benefit of Mozambique and its future generations.” When looking ahead to the coming years, while Absa Bank Moçambique anticipates the continuous development of the national economy, its strategic objectives are rooted in not only keeping pace with this progress but also in aligning with the evolving needs of its communities.

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INTERVIEW

“Our foremost commitment is to continue delivering innovative solutions, particularly in the digital realm, to ensure a higher quality of service for our customers,” Pedro explained. “As we embark on this journey, our strategic objectives encompass a comprehensive vision that goes beyond mere adaptation. We aim to set quantifiable goals, leveraging our position in the financial sector to contribute meaningfully to the well-being of our customers and communities." “We envision expanding our reach and influence, introducing new products and services, and embracing digital advancements to enhance the overall banking experience,” he went on. “Our commitment to social impact remains integral to these objectives as we strive to make a positive difference in the lives of our stakeholders." “As we navigate the future, our optimism is driven by the belief that our strategic initiatives will not only elevate the banking experience for our customers but also contribute to the broader social and economic development of Mozambique.” With the banking industry undergoing constant evolution, Pedro also provided his predictions regarding the challenges and opportunities he foresees, underscoring the bank’s unwavering belief in the potential of Africans and their small businesses. “Our vision is centred on leveraging the lives of Mozambicans, especially the youth, by empowering them to innovate in their investments with the Absa Group as their trusted partner,” he said. “A primary challenge and opportunity lie in our commitment to expanding our influence, not only within Mozambique but also across the African continent. Our focus is on offering practical solutions tailored to the emerging needs of each client, solidifying our presence through plans, projects, products, and services designed to elevate our position in the region.” In closing, he accredited digitalisation as the cornerstone of the bank’s strategy moving forward. “Acknowledging the role of new technologies in shaping the future, we are steadfast in expanding our digital channels. Our dedication to digital excellence was recognised in 2021 when we were honoured as the Best Digital Bank in Mozambique at the Global Banking & Finance Awards. Strengthening our digital channels became crucial during the COVID-19 pandemic, enabling us to maintain seamless service provision while ensuring the safety of our customers through physical distancing." “Our modern and completely digital branches, coupled with an expansion plan covering all provinces of Mozambique, reflect our commitment to inclusivity and accessibility. We aspire to make every Mozambican citizen part of this digital transformation, positioning ourselves as the partner of choice in this new reality.”

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Pedro Carvalho CEO, Absa Bank Moçambique

INTERVIEW

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TECHNOLOGY

Mitigating Cyber Risk in the Financial Sector From major banking corporations to small town credit unions, the financial industry continues to find itself a prime target for sophisticated cyberattacks and frequent data breaches. Due to the wealth of valuable information financial institutions possess, cybercriminals are always in the mood to invest the needed time to hack vulnerable systems in both large and small financial institutions. Unfortunately, the repercussions of a cyberattack can be severe, causing reputational damage that goes far beyond any tangible losses, as the mere mention of a breach can swiftly bruise customer trust that took so long to build. Yet, while the financial industry has evolved into an era of high digital dependence, many institutions still depend upon legacy systems to run day-to-day operations, leaving them highly vulnerable if crucial patches and updates are not made quickly This results in an increased risk for malware attacks, phishing scams, fraud and of course ransomware attacks and data breaches. Such reliance on a digitized infrastructure also makes banks vulnerable to operational disruptions like system failures, service outages and transaction delays – all of which are considered unacceptable from a customer perspective. Maintain Compliance Through Risk Mitigation Due to the high cyber risk involved in the financial sector, commercial banks, insurance companies, investment firms and everything in between are required to comply with a number of data privacy and financial reporting laws that are specifically designed to prevent these types of incidents. From SOX to GDPR and PCI compliance, proper management of compliance has long been imperative to the success of any bank. Unfortunately, many of the security requirements found in a compliance framework do not actually help institutions gain a full understanding of where their security gaps may be, what the true scope of their attack surface is, or even what specific type of threats they may face in the future. Additionally, the stated or implied best practices of compliance frameworks do not accurately reflect the accelerating pace of a rapidly evolving cybersecurity landscape, where, through innovation like AI and Large Language Models, the pace with which new vulnerabilities are discovered and actually exploited in the wild is severely misaligned with expected mitigation timelines. Prioritizing risk over compliance will actually allow organizations to satisfy many compliance requirements while better securing the security ecosystem as a whole. As a result, having a robust cybersecurity strategy in place to recognize, react and mitigate such security risks and effectively safeguard private data is crucial to the success of the organization.

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TECHNOLOGY

Establish A Secure Assessment of Risk According to a recent report released by Google’s Threat Analysis Group (TAG), the number of hackers-for-hire is set to grow immensely over the next few years. With this growth comes a crucial need for banks’ IT leaders and security professionals to implement proper risk management in order to protect not only their own assets but that of their clients. Data security remains a complex environment with many moving parts that require continuous and consistent effort. Understanding what’s at risk is a key first step for CISOs. One cannot protect themselves from things they don’t know exist. Proper risk management starts with executive leaders taking a comprehensive assessment of known security risks within their organization’s environment. Next, regular scans should be conducted in order to swiftly identify vulnerabilities and provide mitigation tactics while ensuring stored data is consistently backed up and encrypted. Security monitoring of this caliber involves the examination of multiple logs or network devices, such as servers, firewalls, and switches, to detect possible security incidents. Ensuring a collaborative and prepared incident response plan is in place will allow both IT teams and employees alike to map out and practice response steps before being placed under pressure. Disaster plans like these are essential to a reliable and efficient cybersecurity program, but large enterprises often find that solely relying on manually operated and humandriven security efforts can negatively impact the security of the business. Streamline Securities Strategy with Automated Tools This is where automating the crucial step of patch management can transform a cyber resilience strategy for the financial industry. Currently,

the go-to process of loading updated versions of software to apply vulnerability patches and bug fixes is still a very traditional approach. With manual patching in place, banking systems must schedule maintenance downtime while servers reboot and get serviced, often interrupting business operations and locking customers out of their apps or online access to their funds. Traditional mitigations to this disruption involve over-spending in capacity and high availability, which unnecessarily increases upfront costs for an IT solution in-house, or increases spending on cloud capacity, as appropriate. Relying upon High Availability in this manner, to cover for operational and predictable downtime, is not its intended original goal of disaster resilience, but is, unfortunately and expensively, abused this way. Unfortunately, because of the tedious and labor intensive process that patching is, security teams often will, ironically, choose to delay such downtime by weeks or even months to avoid interruptions that may be considered too frequent. Yet, this approach to security completely goes against natural reactions to risk. If one was going to bed on a Tuesday night and noticed their back door wide open, why would they wait until Friday or later to close it? This delay in applying patches means hackers are virtually handed the opportunity to exploit known vulnerabilities. This mentality of delaying vulnerability patches due to inconvenience places the entire enterprise at a severe risk for a damaging attack. But by choosing to apply automation to the patching process, security teams can confidently limit the high-risk window that appears when a critical vulnerability is found while lowering the organization’s chances of falling victim to an exploited and unpatched vulnerability that can result in a ransomware attack, data breach or both.

Additionally, by employing a live patch management system, labor cost savings can be substantial, as scheduled downtime and lengthy maintenance windows will no longer be needed. Moreover, initial spending and operating costs and complexity can be lowered by reducing the dependency on complex high availability scenarios intended to just cover these potential disruption events. Instead, IT teams can shift more of their focus to tasks that are more strategic to the business itself. A quick response to a detected threat is key to mitigating damage. Because the financial industry requires 24-hour access for its customers, having their assets compromised by a ransomware attack could be catastrophic for daily operations. Having an incident response plan in place not only allows the organization to prepare its response steps before being placed under unexpected pressure, but it also allows IT teams to implement automated recovery plans that ensure a consistent patching routine.

Joao Correia serves as Technical Evangelist at TuxCare Joao Correia serves as Technical Evangelist at TuxCare (www. tuxcare.com), a global innovator in enterprise-grade cybersecurity for Linux.

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FINANCE

An outlook for the UAE’s fintech market in 2024 When we talk about the cities and countries leading fintech innovation, there is a tendency to focus on places in Europe, North America and East Asia. Based on fintech’s evolution over the past decade, such a focus makes sense. Traditional financial centers in cities like London, New York City and Singapore have effectively leveraged their global financial status and facilitated the rise of fintech startups who have permanently transformed the banking sector. Today, fintech is still a trending topic of discussion. The reason for this boils down to the fact that the untapped potential, and subsequent opportunities on offer, is significant. This is certainly the feeling in the UAE, which is on the brink of becoming a new global voice on fintech innovation. The country is currently the leading fintech hub in the Middle East and North Africa (MENA) – the total value of transactions recorded in 2022 was just under $40 billion, with analysts anticipating a projected CAGR of 15% up until 2028.

The UAE’s rapid rise is a consequence of many factors. Its geographical location, local demands for fintech solutions, attractiveness as a destination for foreign direct investment, and digital disruption all play a role. Yet perhaps most significant has been the willingness of the UAE’s governing authorities to deliver policies that encourage innovation, such as the introduction of regulatory sandboxes and the issuing of digital banking licenses. These have been delivered as part of the bold framework set out in the Abu Dhabi Economic Vision 2030 which sets out the strategy for encouraging innovation and moving away from a reliance on oil to power the economy. These announcements were pivotal for Central Asian fintech Alif, which launched Alif Pay in the UAE in September 2023 to offer innovative payments and financial services solutions. With any market projection, a realistic perspective which acknowledges both the opportunities and challenges are warranted. The future of the UAE’s fintech sectors stands bright. However, its future success will depend on whether the UAE can sustain its growth and realise its projections in the immediate and longterm. A myriad of factors are at play here, with 2024 set to be a defining year. Fintech solutions to local demands The UAE has been embracing fintech solutions to modernise existing financial processes. This was initially spurred on during the COVID-19 pandemic, when lockdown restrictions sparked a shift towards digitally-enabled solutions. The expat community now numbers 9 million people according to GMI, which is remarkable given the population of the UAE is estimated to be around 10.17 million. It demonstrates why interest in fintech solutions, and in particular, cross border payments is so strong.

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Remittance payments, namely outbound, are notably high in the UAE. As a result of migrant workers and expats sending money abroad to their home countries, the transactional value of digital remittances is set to reach $6.95 billion in 2023. The number of users is also expected to grow to 1.4 million users by 2027. This is being led by fintech startups. In the past, sending funds cross-border proved to be a costly, long and in some instances, a complicated process. Fintech startups have drastically improved the process by cutting down time and costs involved for cross-border transactions. These can also be arranged via a mobile app, improving accessibility. Given the size of the UAE’s remittance market on a global scale, and the growing popularity of Dubai as a destination for international commerce, fintech services related to cross border payments will remain high. As such, we are likely to see more fintech companies entering the remittance market in 2024 to support the UAE’s demands. Maintaining FDI inflows Of all the factors that have supported the rise of fintech hubs, FDI has proven integral. At the base level, FDI brings in capital from foreign investors, which is essential for fintech startups and companies to fund their operations, research, development, and expansion. Significant financial resources are required, particularly at the early stages of a business’ growth cycle. FDI can provide this, as well as opening up access to new global markets. It’s no surprise then that the UAE is ranked West Asia’s top region for FDI, receiving 47.1% of total regional inflows in 2022, amounting to $48.3 billion. The country also ranked first in MENA, albeit with a lower percentage (32.4%) of total regional FDI inflows. Within this context of FDI, the UAE government has identified fintech as one of its most promising sectors, and will continue to pursue reforms to enhance international access to new opportunities. This is likely to remain the case in 2024. However, the UAE should maintain its streak of reforms and supportive policies to effectively defend and build its status as the rising fintech hub of MENA. The potential on offer across MENA makes it a competitive environment for investment. The UAE needs to attract investment by ensuring its fintech industry boasts the startups set to lead on the next iteration of fintech innovation.

Shafique Ibrahim CEO of Alif Pay

Preparing for the new year Dubai has been laying down the foundations to establish itself as fintech capital over the longterm. The combination of FDI, local market demand and innovation will continue to be key, supported by opportunities to champion the potential on offer. Dubai International Financial Centre (DIFC) will be running the second Dubai Fintech Summit in 2024, with the aim of setting the global benchmark for the manner in which enterprises and governments approach financial innovation. The themes underpinning the summit include payments, Web3, embedded finance, open finance and regulation and policy making – a reflection of the themes that the DIFC considers integral to the sector’s rise. We will also see the UAE continue to fulfill its vision set out in the Financial Infrastructure Transformation Programme which seeks to make it a global innovation hub for financial and digital payments. A core pillar of this is the creation of a regulatory environment which is supportive of innovation and makes the UAE globally competitive in the fintech sphere. Whatever the path the UAE’s fintech sector takes, we are only at the beginning of a longer journey. By maintaining a vision and encouraging collaboration between private and public bodies, the UAE could be on path to becoming a global fintech capital.

Issue 58 | 37

FINANCE

The power of lending relationships in syndicated loans Borrowing from relationship banks could save millions of dollars for borrowers in the primary market of syndicated loans, says Yafei Zhang, Lecturer in Finance at Alliance Manchester Business School. Syndicated loans are among the most important external financing sources for firms all over the world. To give a sense of scale, according to Thomson Reuters DealScan, the annual average proceeds from syndicated loan issuances were approximately $2 trillion from 2005 to 2022. Such loans are much larger than corporate bond issuances and several times the proceeds of equity offerings, including both initial public offerings (IPOs) and seasoned equity offerings (SEOs). Furthermore, the growth of the market has eclipsed that of the bond and equity markets, particularly since the 2007-2009 global financial crisis. While typically only large and public firms have access to the bond and equity markets, borrowers in the syndicated loan market range from large public corporations to medium size private entities. Large deals Almost every large merger and acquisition deal is financed by syndicated loans. For instance, Elon Musk, the current CEO of X (successor of Twitter) issued a $25.5 billion syndicated loan led by Morgan Stanley (participant lenders included Bank of America and Barclays) to buy Twitter in April 2022. Private equity firms are also frequent borrowers in the syndicated loan market. In July 2023, one of the largest private equity investors in the technology industry, Silver Lake, raised about $1.1 billion in a syndicated loan arranged by JPMorgan, Citigroup, and Santander to fund its takeover of German company Software AG. Some firms also tap into the syndicated loan market to raise finance for general corporate purposes. In May 2023, London-based data centre business AtlasEdge raised $900 million from a syndicate of banks including ING Bank (the lead arranger), Scotiabank, NatWest, Santander, and UniCredit Bank for a cross-border expansion strategy.

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Book-building Although syndicated loans are not securities that can be issued to public investors, they use the same book-building process in the primary market as issuing stocks and corporate bonds. For instance, after a bank wins the lead mandate it will prepare an information memo (IM) that includes a preliminary term sheet describing pricing, collateral, covenants, and other credit terms. The lead bank then distributes this IM to potential investors to solicit demand and each potential investor performs its own credit analysis and comes up with the amount and price at which it is willing to commit. If the loan is under-subscribed, the lead bank will need to sweeten the deal by increasing the yield-to-maturity (YTM). If the loan is over-subscribed, the lead bank would reduce the YTM. This so-called ‘book-building’ process continues until pricing is agreed upon and all investors’ allocations are finalized. Trade-off This practice creates an interesting trade-off for a lead bank. On the one hand it could conduct its own due diligence about a borrower to reduce the need to collect information from other investors. On the other, it could spend less time on due diligence and rely on information from other investors with a cost. A recent paper I co-authored, Lending Relationships and the Pricing of Syndicated Loans, examines how this trade-off affects the pricing process and borrowing costs for syndicated loan borrowers. We have found that a lead bank that has a stronger prior lending relationship with a borrower (measured as the percentage of loans arranged by the lead bank out of all the loans by the borrower within the past five years) relies less on information from other syndicate members and selects fewer participant lenders that have relationships with the borrower. As a result, the size of the yield-to-maturity (YTM) adjustment is smaller during the pricing process.

FINANCE

We also find that a stronger borrowerled bank relationship reduces loan underpricing – the first secondary market trading price (higher than the offer price) minus the offer price. What our study therefore suggests is that collecting information from other investors can be exceptionally expensive for syndicated loan issuers. And ultimately, borrowing from relationship banks could save millions of dollars for borrowers in the primary market of syndicated loans.

Yafei Zhang Lecturer in Finance at Alliance Manchester Business School

Issue 58 | 39

TECHNOLOGY

What are we missing? Questions to ask to accelerate a digital evolution You’re stuck with legacy systems that are out of date and no longer serve the desired purpose. So, it’s time to innovate those systems and start your company’s digital evolution. Similar to a digital transformation — but without the start/end date — a digital evolution is the constant state of change that organisations should be going through to update and differentiate their systems. But once you know what your organisation wants and needs, where do you start? Here are four questions to get you started. 1. What are your motivations? Before you begin anything, you need to ask yourself what the drivers are for this change. Where do you want to get to? Why do you want to implement this change? A key part of this is to create a mentality and culture that ensures change is not done just because you’re wanting to change, but for getting value.

Innovation is what drives change and lies behind the digital evolution process. It will look different depending on the size of the company and sector, but it rests on achieving business goals and gaining an edge in the market. You might innovate to achieve greater efficiency with workflows, save on unnecessary system costs, or develop a new offering for your clients and customers. It’s always different, but in all these cases, there is a goal and an outcome. There is also value in understanding when things don’t need to change just yet. Innovating for the sake of innovating can be counterintuitive. You need to ask yourself why you are doing it — what are you missing — and then outline what you are going to do and how. This gives you direction, clarity and a focus to aim towards. 2. Is your goal balanced? When setting your goal, make sure your budget allocations and desired outcomes are compatible. An individual digital transformation could be costly, but if each one is positioned as part of a digital evolution, this means they can be seen as step-by-step changes that build on your offering. This is a valuable mindset. As digital evolution is such a broad undertaking, outlining each step in bite-sized chunks makes it more manageable and allows you to see what costs are affordable within this. While one project may have short-term impact, you also need to balance this outcome with a longer term focus as well. Is it necessary and cost-effective? But equally, by investing in digital transformations and renewals now, it could make the process cheaper in the future when bigger changes are needed.

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TECHNOLOGY

Change doesn’t always happen instantly, and you need to consider the fact you are bringing in new technologies and ways of working that will take time to instil, take effect and grow. Balancing your goal(s) at the outset will help accelerate the process after. 3. How do you move in this direction? Determine where to start. It sounds simple enough but can be the hardest step to do. What is the first action to take that adds value? As a digital evolution focuses on innovating and looking ahead, companies can often fixate on what new technologies, ideas or processes they can integrate into the business. As outlined, this is crucial to moving in your direction. But before you start ripping everything up, using the legacy systems you have can help you make this first step. If you can collect all of your data from these different systems, you can get an overview of your application suite and business processes. This can tell you which applications are inefficient or costly, what works well, and allow you to resolve any issues in businesscritical software and implement new software if it’s needed. With this insight, you can plan much more effectively and make the move towards an adaptable and modern infrastructure. 4. Is AI truly going to fix the problem? Don’t jump to AI without asking whether it’s going to be the element that is most time or cost-effective. Its constant presence in the news can make it seem like a shiny object you must have for business success moving forward.

But a company shouldn’t just place it into their operations because it wants to have it. Ask yourself what benefit(s) will it bring to the company? And what are you going to use it for? As something to help your employees with their work? Or for a new product or service? On the other hand, it can also be the case that people will be wary of using AI given its negative news coverage. AI has many different capabilities and it is crucial to outline what type of AI you are using and why. This is why it is so important to make sure all key stakeholders are involved in the decision-making process. If they are not included, they will be more resistant to change. But if they are involved in discussions, they can contribute to the process while you can manage expectations, outline your vision and explain why you are doing or not doing it. Accelerating the process A digital evolution is an ongoing process that, implemented correctly, adds continual value. Once it is up and running, it then becomes a case of adding to and adapting systems, rather than having to make major upgrades and overhauls. Taking the time to ask these questions from the outset will accelerate the process after and make it far more robust and efficient in the longer term.

Nicole Hargreaves Senior Business Consultant at Amdaris

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TECHNOLOGY

Why businesses must get ready for mandatory e-Invoicing In a world where almost every business process is now driven by digital technology, it’s perhaps surprising that something as fundamental as invoicing has proven to be resistant to change and improvement. It’s true that some companies have been moving towards some form of digital invoicing for a while, often adopting PDFs which resemble the paper invoices we’re used to. But PDFs offer few of the benefits that a fully electronic, automated invoicing approach can deliver. So why is there still a lag? Part of the reason for the slow transition is that e-Invoicing remains optional as opposed to mandatory in most countries. In the UK, for example, there is no overarching e-Invoicing mandate. And while some 80 countries around the world do have some form of e-Invoicing mandate in place, with South American countries leading the way, the majority don’t. However, change is coming fast. In a December 2022 publication, the European Commission proposed to make e-Invoicing mandatory by 2028, and another 50 countries have put the wheels in motion on compulsory e-Invoicing too. So, with those mandates on the horizon, the transition to e-Invoicing is going to go from ‘niceto-have’ to ‘must have’ in the medium to long term anyway. But there are many good reasons why companies should consider moving more quickly.

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5 reasons companies should move to e-Invoicing now 1. It simplifies tax audits No matter how you send and receive your invoices – electronic, paper, or fax – there is still a legal obligation in tax law to do so within an auditable and robust process. Part of that means archiving tax invoices in case of long-term audits. Depending on the region, the retention period can be between four to eleven years from the initial transaction date. That’s where we begin to see the flaws in an otherwise tried and trusted paper-based system. Paper can easily get lost or damaged. An e-Invoicing process, however, sees each step logged and traceable to verify best practices, and sees invoices stored in a secure digital archive that ensures integrity, authenticity, and longevity. These can then be made easily available to tax auditors from an intuitive web interface, simplifying the entire tax audit process. 2. It offers proven return on investment Gartner’s ‘Top Priorities for Finance Leaders in 2022’ saw e-Invoicing playing a significant role in 5 of 8 key areas in digital business optimisation: reducing costs through automation, improving employee productivity, reducing sales & general admin costs, and optimising cashflow. With CFOs and finance directors keen to justify the outlay on any technological investments, these benefits more than validate the move to a fully automated B2B e-Invoicing approach. As an example, Billentis has estimated that the total cost of a manual invoicing process in Accounts payable comes to around €17.60 per invoice, while true e-Invoicing can offer cost savings of up to 64% – hard to turn down in good times, let alone in a strained economy when every little helps. 3. It unlocks bottom line cashflow Automated invoicing is inherently more scalable, prone to fewer errors thereby reducing time-consuming exceptions. Some studies have shown that the average error rate for manual data entry is about 2%. That might seem small, but it compounds over time, with the potential to lead to significant financial losses.

TECHNOLOGY

The upshot is that fully automated electronic invoicing means companies can get paid earlier and can also pay their suppliers more quickly – avoiding late payment penalties and potentially benefitting from early payment discounts, too. This generally means more working capital and a reduced dependence on credit, unlocking bottom line cashflow and the ability to invest in growth opportunities elsewhere in the business. 4. It’s already in play While many countries are only now beginning to embrace e-Invoicing, don’t mistake this for an experimental or untested technology. More than a decade ago, Chile, Mexico and Brazil began to experiment with alternative approaches to electronic invoices to overcome significant tax fraud challenges. This led to Mexico becoming the first country to mandate e-Invoicing in 2011, reducing their VAT gap by 6% within two years. Today countries around the world are beginning to do the same – but markets as varied as the EU, Egypt, and Saudi Arabia will take very different paths to placing this requirement into law. Beginning the work of building an e-Invoicing workflow today puts you on a stable footing to operate more seamlessly across borders, regardless of how and when new regulations are introduced. With these new mandates fast approaching, companies that implement a consistent process now will be able to focus on growth instead of adaptation.

providing access to any expertise that is lacking internally. Also, solutions with a comprehensive multi-pronged approach to data security can enable companies to act confidently in the knowledge that security regulations are complied with as standard. This kind of outsourced approach makes the switch to e-Invoicing much easier than it seems and can help companies get their transition off the ground immediately. Get ready for global mandates The regulatory landscape around e-Invoicing may be a patchwork now, but all signs point to more global mandates ahead. Even so, e-Invoicing offers a number of both direct and indirect benefits that represent a real opportunity for businesses that can make the transition now, rather than later. By streamlining the invoicing process and reducing various operational costs, as well as improving cash flow generally, e-Invoicing can provide a competitive edge in a tough economic climate, and set the foundations for long-term growth.

Ken Clark Director, Product Marketing, Business Network Cloud

5. It’s easier than it seems Despite the number of perceived challenges holding leaders back from implementing e-Invoicing – data security, integration with existing systems, and perceived complexity of technology – there are global e-Invoicing solutions out there that remove those concerns about technical complexity while also

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BUSINESS

Balancing automation and human touch in HR and recruitment Introduction HR today goes beyond traditional staffing and recruiting. In modern-day HR and recruitment agencies, there is a constant challenge of ensuring balance between fast-growing automation tools and the unique human touch of each candidate. Given that, there is a dire need to dive deeper into this problem to draw a balance and insights from industry research and the wisdom of seasoned professionals, with whose help we can get a rare insight into the recruitment industry. The Automation Advantage: Efficiency, Bias Reduction, and Streamlining Tasks There is an undeniable impact of automation tools on the intricate landscape of recruitment processes. Algorithms and advanced AI systems, adept at processing vast volumes of applications with remarkable speed and precision, have become instrumental in reshaping the initial stages of talent acquisition across diverse industries. Moreover, the substantial influence of automation extends beyond mere efficiency gains. By streamlining repetitive tasks, HR professionals are empowered to allocate their time and expertise more strategically, fostering a more personalized and empathetic approach to candidate engagement. This shift towards a harmonious blend of automation and human touch highlights the evolving nature of HR, where technological advancements not only expedite basic steps but also enhance the overall quality and inclusivity of the recruitment journey. Technology as a Competitive Edge The strategic merge of automation gives organizations the ability to navigate the dynamic currents of recruitment with unparalleled precision. From the initial stages of candidate sourcing to the intricate process of final selection, technology streamlines operations, offering a multifaceted competitive advantage. For example, learning management systems, online academies, CV builders, cover letter generators, special interviewing platforms, and other services, can streamline a recruitment process greatly. These tools can not only help in reducing bias, but also ensure that everyone gets a fair chance to begin with. However, the so-called ‘tech-wave’ has not only greatly improved the efficiency of the hiring system, but has also unfortunately sparked a fear in the hearts of job-seekers – that there is a lack of human touch and understanding in this modern world. Granted, a tech-based system reduces bias in hiring practices, but there is still a need to draw a line between automation and humanization.

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The Human Touch Imperative While automation brings efficiency, objectivity, and the ability to process vast datasets swiftly, it inherently lacks the nuanced understanding and empathy that human interaction brings to the hiring process. The imperative of striking a delicate balance between these two ends becomes evident as organizations strive to preserve the personal touch while also making use of the ease that technology brings into the HR department.

BUSINESS

Striking a balance Ms. Christine Sheng Regional Managing Director of Talentvis

There are a few ways that companies and recruiters have equipped in an attempt to strike a balance. One avenue that elegantly addresses this challenge is the collaboration with recruitment agencies. These agencies gracefully integrate advanced technologies, employing applicant tracking systems and AI tools to efficiently sift through candidate data. This automation allows for a proactive response to potential candidates. This is all done while carefully sifting through the candidates and understanding on a personal level about what each one brings to the table. In this harmony, recruitment agencies serve as a bridge, seamlessly blending the efficiency of automation with the nuanced understanding that comes from human interaction. The result is more than often a happy employer and a happy employee – the match of which was made without bias while keeping into account the personal needs of both sides. Another strategy that you could use on an individual level would be a proactive investment in skills development. Simply put, having a wider range of achievements, networks and interpersonal skills, you would be less likely to lose the digitized rat race of rejected applications. Emotional intelligence takes center stage, playing a crucial role in understanding and forging deeper connections with candidates. This can especially be refined by recruitment teams and agencies who provide services beyond staffing and ensure that the candidate’s skills are strong enough to penetrate the stringest automated zones of the hiring stages. This strategic approach ensures that efficiency is not achieved at the expense of personal connection. The very essence of the human touch lies in the ability to comprehend not just the qualifications on a resume but the immeasurable qualities that define personality, cultural fit, team dynamics, and the unique aspirations of each candidate. Automation excels in processing data, but it falls short in deciphering the subtleties of individual experiences, motivations, and soft skills. Achieving the perfect balance between automation and the human touch necessitates a thoughtful integration of technology into recruitment workflows, ensuring that the advantages achieved from automation today do not compromise the humanization and singularity that candidates bring.

Additionally, initiatives like speed interviews exemplify a fusion of technology and personal interaction. These innovative approaches enable recruiters to make swift yet impactful assessments, maintaining agility in the recruitment process while upholding a human connection with candidates. Ultimately, the art of striking this delicate balance involves a multi-faceted approach— leveraging recruitment agencies, investing in skills and personal development, and prioritizing the building of personal connections—all contributing to a harmonious recruitment strategy that blends the strengths of automation with the irreplaceable insights of human professionals. Conclusion The advantages of tech are endless – but it comes with a price of the potential loss of humanization. To prevent this, insights from industry experts can help highlight the critical nature of this balance, emphasizing that a successful recruitment strategy hinges on leaving ample space for a personal touch which can be achieved by excelling at face-to-face interviews, widening your skillset, network, and reaching out to agencies that can identify candidates’ unique natures.

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BUSINESS

How to keep financial data secure from cyber attacks Speed and security are everything, especially in finance. Organizations in the finance industry or those dealing with financial information know they need to protect themselves against cyber attacks, but are they doing enough on their own?

Faisal Bhutto SVP of Cloud and Cybersecurity, Calian IT & Cyber Solutions

Organizations dealing with sensitive, personal information have always been major targets for bad actors, but rapid digital transformation has increased vulnerabilities to cyber attacks. As more businesses and consumers adopt digital financial services, more opportunities for cyber crimes are created, and the industry must continuously work to improve data privacy and security to maintain smooth business operations and customer trust.

Even small attacks can have significant impacts. The recent MGM Resorts data breach sparked by vishing is one example that caused the company to shut down its systems in an effort to protect guest data. The cybersecurity issue affected financial systems like online reservation systems, slot machines, and ATMs. In this instance, leaked credentials gave bad actors an opportunity to access internal systems and processes, laying the groundwork for cyber attacks. To provide the most protection to financial data, organizations should deploy a robust layered business approach of secure solutions that rapidly interconnect financial branches and help customers with necessary software while also managing 24/7 threat hunting to ensure the highest levels of security. As a result, organizations will be better equipped to examine their data centers, networks, endpoints, and employees to provide an effective cybersecurity plan. While some institutions can take on this level of work in-house, bringing in a team of experts to focus on cybersecurity is a strong solution that will help organizations better prepare for, prevent, respond to, and recover from cybersecurity problems. Below are the essential services organizations must consider when looking for experts and solutions to keep their financial data, businesses, and customers safe. Assets and vulnerabilities Auditing an organization’s assets is a critical first step to uncovering vulnerabilities. Conduct inventory management, along with internal and external scanning, to assess the risks and potential exposures of IT services, hardware, infrastructure, and operating systems. Protect assets with SASE, firewalls, and VPNs.

The problem for organizations lies in keeping up with the breakneck pace of digital evolution and simultaneous increased exposure to cyber crimes. Calian IT & Cyber Solutions’ data findings reveal cyber attacks primarily occur in seven areas: network, endpoint, identity, SaaS, cloud, Firewall, and scanning. Of these areas, those with the highest rates of cyber attacks are network with 30%, identity with 20%, and endpoint and SaaS with 15% each.

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Risk and maturity Developing a risk management strategy involves monitoring developments and understanding potential threats an organization might have missed through a risk maturity and management model. Effective models will allow

BUSINESS

organizations to measure the potency of risk assessments for recovery and protection by gathering data to determine what might lead to risks, inform the assessment process, and understand the infrastructure’s ability to withstand the risk.

By combining red and blue teams to work through cybersecurity issues, solutions are created based on offensive and defensive strategies.

Remediation

Cybersecurity providers can conduct gap analyses, configuration audits, and review compliance requirements against an institution’s existing IT environment to identify the efficacy of assets and existing data protection plans. This is based on an evaluation that looks at previous threats while simultaneously looking at potential and hidden vulnerabilities. The results of these assessments will uncover issues to be addressed on a priority basis.

Each institution will require a customized approach to data backup and additional cybersecurity solutions to address its payment processing and overall business needs. Implementing an effective and proactive recovery plan will help mitigate business disruptions as a result of technical failures or larger-scale natural disaster events. Robust recovery plans will prioritize business continuity by looking into root cause analysis, restoration services, and discovering the maximum tolerable downtime to address these issues more quickly. Remediation also helps organizations recover from incidents or ransomware attacks without making payments. By effectively monitoring for risks and estimating the time spent to overcome them, organizations can quickly detect and address attacks to minimize downtime and damages. Awareness training By design, many organizations, like financial institutions, must participate in frequent training programs to familiarize employees with constant updates to compliance and regulatory requirements. Security is often included in these programs but requires greater focus to truly understand and prepare for cyber attacks. Sharing information and conducting mock security tests will allow cybersecurity experts to raise cybersecurity awareness in a controlled environment. This means educating employees about existing and potential threats and vulnerabilities while also walking them through solutions. Awareness training comes in many forms and can be customized to suit an organization’s needs. This can include ransomware simulations replicating real-world attacks using controllable components such as automated protection response, threat intelligence, encryption, advanced TTPs, and more. Purple team exercises are also effective.

Assessments

For example, a ransomware assessment will determine underlying vulnerabilities within an infrastructure in addition to other issues threatening an organization’s security. Continuous monitoring increases awareness of ransomware attacks and provides valuable insights to help organizations quickly respond and prevent them. Dark web monitoring is another essential tool to minimize risks. With so many illegal and destructive actions building in the virtual shadows of the dark web, organizations need threat assessment tools to keep track of the threats, monitor sensitive data, and receive notifications if that data falls into the wrong hands. Penetration testing Conducting a simulated cyber attack experiment will help organizations find and repair gaps in their cyber defense strategies. These mock tests will reveal the effectiveness of networks and personnel in combating cyber attacks. Comprehensive assessments require frequent penetration testing to build a more robust cyber defense solution. Managed Security Services By offering year-round support available 24/7, managed security services providers (MSSP) sweep protection and security management for organizations and their payment processing systems. Centralized management services include network scans and reports to identify vulnerabilities, behavior monitoring to

detect irregularities within networks and endpoints, mapping intelligence to proactively respond to cyber threats, email and mobile app defense, and layered protection via multi-factor authentication. Endpoint security With payment processing, customers are an organization’s biggest threat. This is due to the various user endpoints created by tablets, smartphones, laptops, and other digital devices, which provide ample opportunities for malicious actions. Look for solutions that provide endpoint security training focusing on user awareness and next-generation data protection to protect against sophisticated threats. Data protection A dynamic data protection plan will help prevent traditional data loss prevention deployments and protect sensitive information. Implementing behavioral analytics is a key element of modern data protection. Analytics provide realtime monitoring, which works to expose abnormal internal or external data access and file movement. By identifying normalized behavior, intelligent analytics provides security against data leaks and insider threats. Data protection is also enhanced by backups, which can restore data in the event of a disaster, malicious act, or loss. With backups, organizations are protected by copies of data that can be used to quickly recover information. By outsourcing security to third-party professionals, organizations can lean on their expertise and consulting services to map out a cybersecurity strategy that protects their payments and suits their unique business needs. While capable of responding to threats, these security experts support a proactive approach to threat prevention and management by monitoring infrastructure, conducting risk assessments, providing cybersecurity awareness training, and implementing and integrating products. Working with dynamic cybersecurity providers will help organizations maintain safety, security, and success across business and customer operations.

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BUSINESS

Financial wellness in marketing: How SMBs can build trust with Gen Z consumers With every generation feeling the crunch of today’s economic impacts, it’s no surprise that the idea of financial wellness is on the rise. Generally defined as the ability to meet basic needs and manage money for the short- and long-term, financial wellness is a topic on everyone’s lips, however younger generations are particularly in need of support.

Jacqueline Bourke Senior Director Creative at iStock

Gen Z – a generation that has only recently entered the workforce – is acutely feeling the effects of a volatile job market, climate change, and ever-increasing bills. Findings from iStock’s latest VisualGPS consumer research show that British Gen Z consumers are feeling pessimistic about the state of their financial health during the next 12-18 months. The cost of living, the increased costs of goods and services and inflation are the top three economic concerns for this demographic – well ahead of long-term commitments such as rising mortgage rates or stock markets. The most important life priorities for Gen Z’s are having a work-life balance, having enough money to not worry about the cost of living, and having more time for themselves. There has been a cultural shift from an aspirational future to a more immediate present, which can now be seen in Gen Z’s attitude toward work and money. Thinking about this demographic as customers then, businesses should be taking a thoughtful approach to marketing, using their visual communications to support their customers towards healthy financial habits. Encourage financial literacy Poly-crises have an impact on the financial wellbeing of younger consumers, and research tells us that 7 in 10 British Gen Z’s perceptions about money have been impacted by the events over the past year. Additionally, the number of 16-24 year olds contacting the Financial Ombudsman Service for guidance has risen by more than 200% over the past five years, highlighting how Gen Zs are seeking to improve their knowledge around financial literacy.

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Businesses should aim to empower their customers to make choices that help them manage their financial goals independently. Historically, financial services brands have focused on telling aspirational stories around traditional milestones, such as buying a house, raising a child, or buying a first car. However, those milestones feel out of reach for many Gen Z’s, who are focused on the here and now. It’s important to promote a sense of personal agency around healthy financial behaviours, so consider visuals that showcase Gen Z’s engaging with different actions, such as budgeting, opening instant access savings accounts, and accessing other resources for better money management.

There is an opportunity for brands to connect with Gen Z consumers by highlighting themes of togetherness and empathy. Consider visuals that show proactive care towards people who are currently experiencing financial anxiety or stress. Video is an effective medium for engagement with Gen Zs Findings suggest that 7 in 10 British Gen Z consumers watch video content on social media to learn or educate themselves. When you consider that 78% of Gen Zs engage with social media on a daily basis, there is a clear opportunity to reach your audience here. Move away from depicting Gen Zs stressing over missed payments and paying bills, and instead opt for videos that show people coming together to manage their bank balances on their smartphones, to support your customers toward financial wellness.

Normalise conversations around financial and mental wellbeing The current economic climate is associated with a reduction in wellbeing, with increased anxiety and worsening mental health among Gen Zs. Additionally, our research has found that 86% of British Gen Zs feel it’s more important than ever to be sensitive to the fact that people may have mental health issues.

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What trends will dominate the B2B payments world in 2024? In with the old, as good as new The first use of a commercial card for a B2B payment was recorded by the travel industry in 1937. Yet nearly a century later, commercial cards are still not a widespread B2B payment method. Why? They are often hampered by security concerns, supplier acceptance, and incompatibility with existing financial systems.

Pat Bermingham CEO, Adflex By Pat Bermingham, CEO, Adflex

As we enter 2024, this might be about to change. Rapid digitalisation, advances in card solution designs and pressure on corporate treasury departments to improve cashflow (caused by the current economic climate), have seen an uptick in commercial card use. By using commercial cards, suppliers gain access to a line of interest free credit earlier in the process, sometimes referred to as ‘pre-shipment financing’, which also has the potential to extend payment terms by up to five months. Cash flow is crucial for all businesses, large and small, so a solution that optimises working capital may be the differentiator in keeping a business open, resilient and sustainable. The promise of faster, more efficient payments benefits both parties and encourages better buyer/supplier relationships. The attractiveness of commercial cards for both buyers and suppliers will play an important role in shaping the future of trade and accounts payable. Making virtual, reality Businesses in 2024 want enhanced security and spending controls in their B2B payments. This will drive increasing use of virtual cards; in fact, Juniper Research predicts that virtual card transactions will exceed 121 billion globally by 2027; increasing from 28 billion in 2022 and representing growth of 340%.

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A virtual card is a card number which is generated for a specific purpose, be that for a one-time transaction, allocation to a specific employee or department within a company, or with a limited budget or period of time for its use. Virtual cards build on the benefits offered by commercial cards by offering unrivalled control over spend. They can be front-loaded to the exact amount of a specific transaction or budget, and can also be allocated to a specific employee or department within a business. This enables greater control over who can use the funds. Mastercard calculated that virtual cards have the potential to drive cost savings of $0.50 to $14 per transaction, so we expect them to become a popular, automated payment technology in the coming year. 2024’s biggest B2B payment trend B2B payments are often seen as lagging behind their B2C counterparts when it comes to innovation. But as B2B begins to diversify its offerings, we expect that user experience (UX) at checkouts will take centre stage in the B2B world and become a real differentiator in 2024. Corporate buyers will soon expect the same simplicity as they get when buying items in their personal lives. This will be achieved in two ways: first, through B2B solutions based on existing consumer ones like secure remote commerce (also known as Click to Pay; think of it as akin to Amazon’s one-click checkout offer) and payment links; and second, through more nuanced services like Variable Recurring Payments (VRP) and Straight-Through Processing (STP).

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VRPs are an evolution of the current direct debit scheme, allowing a business to make a series of payments ahead of time to better forecast spend and facilitate more informed decisions. STP on the other hand speeds up transactions by automating manual processes, providing a more efficient and secure way to handle accounts payable processes. 2024’s most unlikely payments trend Automation has been the holy grail in B2B for years now, with businesses trying to remove manual methods to save time and money by reducing Accounts Payable (AP) and Accounts Receivable (AR) processes. However, what we’ve seen is that actually automation might not be for everyone, so a trend that may surprise you for 2024 will be some payment services saying, “Yes, you can have fully automated processes, but here are the manual elements that, if you prefer, you can use and keep under your full control.” The real winners here will be those that can enable the best of both worlds, maximum automation, but full control, and if requested, some processes that remain manual. This may seem counterintuitive, but it is part of the larger trend for 2024, which is increasing diversification. B2B is no longer a place for “one solution fits all”, it is and really always has been, too nuanced and complex for that. Business that can choose from a suite of services and hand-pick those most relevant to their business, will come out on top in 2024.

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