Via discussions hosted on the Capco Institute Blog, members debate high profile issues, with frequent and provocative contributions from Capco thought leaders. For institutions around the world, how will the changing financial services landscape form the future of finance?
Authors Tristan Hugo-webb, Jeff Tijssen Published October 10, 2016
Introduced in mid-noughties to protect cardholders from the growing risk of public data breaches, tokenisation quickly became the industry standard for data security in payments. But unlike other standards, such as EMV, that demand significant investment, tokenisation can help retailers achieve cost savings by reducing PCI DSS scope and reconciling chargebacks and payments without handling payment data. And given that it is also compatible with the vast majority of current retail systems and merchant acquirers, tokenisation is ready to power the next generation of card based transactions.
Author Joshua Lintern Published October 07, 2016
In the second and final part of this blog we will examine the perils of relying on trust in a trustless world and explore the challenges around governance and in not using a tiered transaction approach. Read Part 1 of the blog here.
Authors Tristan Hugo-webb, Jeff Tijssen Published October 06, 2016
Mobile wallets – Android Pay, Apple Pay, Samsung Pay (the ‘Pays’) - are popping up in more and more markets and constantly announcing impressive results. It is clear that we have moved into a new phase (but not the final stage) in the evolution of mobile wallets and payment services – one that focuses on solutions tailored to the established mobile customers.
Author Joshua Lintern Published October 05, 2016
A few years ago there was much discussion about how Bitcoin can transform financial services for the good of all involved. This was a particularly interesting notion, given that one of the headline benefits of Bitcoin is that it is censorship-resistant and answers to no regulator, whereas financial services is one of the world’s most regulated sectors.
Authors Nic Parmaksizian , Alexander Boere Published September 27, 2016
From a boring black and white bank statement to a full colour, multi-branded monthly record of how where and when you spent that hard earned cash? From a ‘customer base’ to a fully engaged focus group, actively involved in and enthusiastic about product refinement, naming and even pricing? Or going from designing Donkey Kong to creating online investment scenarios? Are these just ‘fantasy futures’ for consumer banking? Or could they be a delivered reality within a couple of years?
Author Sara Feenan Published September 25, 2016
Today’s capital markets infrastructure is considered by most to be sub-optimal; some would go as far as to call it simply no longer fit for purpose. Regulatory pressures continue to push markets towards higher standards of transaction reporting and transparency. Processing costs are under constant review. The possibility of cost savings estimated to be as much as €30 - €50 billion annually cannot be ignored. Meanwhile, blockchain technology is starting to come of age in the capital markets. It will soon be ready to play an important part in realising these vast savings and delivering significant opportunities to the industry as a whole.
Author Jeroen Aumand Published September 22, 2016
In this three-part blog series, Capco’s Jeroen Aumand looks at how market abuse is being perpetrated and the challenges for new market surveillance controls/ solutions. Part 1 provided a definition of market abuse and the techniques used for gaining market information. Part 2 reviewed how offenders try to influence the market. Now in Part 3 we examine how offenders hide information and other noteworthy behaviours.
Author Jeroen Aumand Published September 21, 2016
In this three-part blog series, Capco’s Jeroen Aumand looks at how market abuse is being perpetrated and the challenges for new market surveillance controls/solutions. Part 1 provided a definition of market abuse and the techniques used for gaining market information. In Part 2 we review how offenders try to influence the market, while Part 3 talks about how offenders hide information and other noteworthy behaviours.
Author Jeroen Aumand Published September 20, 2016
In this three-part blog series, Capco’s Jeroen Aumand looks at how market abuse is being perpetrated and the challenges for new market surveillance controls/solutions. In Part 1 we provide a definition of market abuse and the techniques used for gaining market information. Part 2 reviews how offenders try to influence the market, while Part 3 talks about how offenders hide information and other noteworthy behaviours.
Authors André Brunner, Nourdine Abderrahmane, Arjun Muralidharan Published September 14, 2016
Blockchain holds considerable promise, but all too often it fails to find sustainable use cases. Trade finance is one significant exception. This traditional revenue source for banks is ready for disruption. A whole new approach, informed by blockchain logic, could bring the very transformation an established yet restricted business is crying out for.
Author Scott Bancroft Published August 23, 2016
In today’s always-connected world, where almost all information is stored digitally, it is critical that sensitive and privacy relevant data protection is assured. The advent of fast communication technologies such as 4G and home broadband, ubiquitous mobile devices and availability of free or low cost ‘Cloud’ services have resulted in easy and convenient transfer data options. Often this is in contravention of corporate policies and regulatory requirements and represents an increased risk to the company, its people and the data subjects. Loss of privacy relevant data is set to become a very big issue with the new EU General Data Protection Regulation (GDPR) on the horizon.
Author Jack Burrows Published August 18, 2016
On August 9, the Competition and Markets Authority (CMA) released the final report on its investigation into the retail banking market. It found that the market is “still not as innovative or competitive as it needs to be”. In response the report outlines a package of remedies which include mandating that larger banks adopt and maintain a common standard for open APIs (Application Programming Interface). To comply - and to benefit -the best approach for banks is to treat APIs as customer products. But what does this mean in practice?
Published August 18, 2016
Although often a lengthy and manual process, wealth client onboarding is critical in creating positive long-term relationships with clients. Firms that master the onboarding process can achieve revenue-generating assets faster, improve cross-sell and up-sell, and defend against early attrition.
Authors Owen Priestley, Prashant Choudhary, Neena Kaiser Published July 29, 2016
Incubators and accelerators play a valuable role in bringing key players together. In an ideal world, we would connect demand and supply rapidly. There would be dedicated specialist environments where you could scope the relevance of potential projects quickly. Incubators and accelerators go a long way to fulfilling these criteria.
Authors Owen Priestley, Luis Del Pozo , Neena Kaiser Published July 27, 2016
In the first blog in this series on incubators and accelerators in the fintech business, we looked at the market-specific factors that impact choice of development locations, and by extension, choice of innovation projects too. In this second blog, we focus on the commercial heart of any incubator or accelerator environment: the business model.
Authors Owen Priestley, Luis Del Pozo , Prashant Choudhary Published July 25, 2016
Few commentators dispute the pivotal role of technology innovation in the transformation of the financial industry. But getting the most out of innovation, by delivering the greatest meaningful value to the customer – requires more than technical prowess or a fancy business model. It needs an environment where the demand and supply sides - in the form of fintechs, start-ups, investors and financial institutions - can align thinking, share visions and co-create real-world solutions efficiently and effectively. In the first of a three part blog series, we look at some of the key context issues that can help create an optimum environment for innovation.
Authors Joshua Ablett, Alvaro Barata Published July 07, 2016
On June 23rd a majority of British voters opted to leave the European Union bringing to an end the UK’s 43-year relationship with the politico-economic union of our continental neighbours. So what happens next for the UK’s emerging fintech scene? The traditional fintech market in the UK generates £20 billion in annual revenue, with emerging fintech companies accounting for £6.6 billion of that total. Both figures owe a lot to London’s position as a global financial services centre, favourable regulations, a readily accessible, large customer base and high availability of capital. But it remains to be seen how much the referendum result will disrupt these factors.
Author Bhanu Shukla Published July 04, 2016
Standalone robo-advisors in this context are pure-play robos who offer only online and automated wealth management service via algorithm-based portfolio management with little human interaction. For such low cost, low margin business models, scale is everything. But to achieve scale, robos must demonstrate value to their customers.
Author Partha Chatterjee Published June 29, 2016
In the modern world, any corporate house has huge amounts of data stored in multiple systems pertaining to different domains. In a trading firm – be it an investment bank, an energy company trading in commodities or a hedge fund – there is significant data related to trading transactions, market data (prices, volatilities, correlation), exchange information, accounting and settlement data. Normally, this information is used for regulatory and compliance-related reporting, what we might call “defense,” in sports terminology. That same information can be used to gain a competitive advantage and make better decisions. It can bring enormous value to the company.