Big data – the game changer reshaping the financial industry

Almost half of finance professionals (45%) regard big data as the most influential trend in the financial sector, according to the Onguard FinTech Barometer survey. Despite more than one-third of respondents (36%) expecting big data to impact employment, very few think it will actually lead to job losses. In fact, more than three-quarters of finance professionals (87%) are confident that their jobs will still exist ten years from now.

The role of big data
The FinTech Barometer survey revealed that availability of data is a crucial factor for organisations. As many as 93% of companies use data and of these, 24% say their company is all about data. Therefore, it is hardly surprising that 45% of finance professionals see big data as a game changer that is reshaping the sector. Research shows that only 7% of companies do nothing with the data they collect and only 6% of finance professionals are unaware of how their company uses data.

New technologies and data acquisition and storage systems are advancing so rapidly that 43% of finance professionals believe financial service providers will essentially become IT companies over the next ten years. This, combined with the growing importance of big data, may explain why 30% of CFOs and other finance professionals anticipate having to develop data-analysis skills in the not-too-distant future.

Onguard CTO Marieke Saeij is fully aware of the value of big data: “As far as we are concerned, big data is not just a passing trend, so it is important that finance professionals learn how to harness it in their work. The ability to interpret the available data can add value, but for big data to be really useful it needs to be translated into actionable insights. At the moment many finance professionals fail to see how big data analysis relates to what they do, but it is the tool that can yield profound insights, improve performance and enhance customer experience.”

Scottish bankruptcies up by 10%

The latest statistics from Accountant in Bankruptcy (AiB) highlight a 10% rise in bankruptcies with an overall increase in Scottish personal insolvencies continuing to be driven by growth in the protected trust deed (PTD) market.

In the third quarter of 2018-19 covering the period 1 October to 31 December there were 1,981 PTDs in the third quarter of 2018-19, an increase of 23.8% on the same quarter last year.

Awards of bankruptcy totalled 1,217 and a 9.9% increase on the same quarter in 2017-18 when 1,107 were awarded. Total personal insolvencies which include bankruptcies and PTDs increased by 18.1% up from 2,707 in 2017-18 to 3,198 in 2018-19.

The Scotland-only Debt Arrangement Scheme (DAS) saw an increase in approved debt payment programmes with 668 awarded in the third quarter compared to 570 awarded in the same quarter last year, showing more Scots are successfully regaining control of their debt.

DAS allows individuals the ability to get back on track without entering insolvency, tore-pay their debts without fear of further action and obtain relief from additional interest and charges.

Within the quarter £9.1 million was repaid through the scheme, slightly down on the £9.5 million in the same quarter last year.

Commenting on the latest figures, Minister for Business, Fair Work and Skills Jamie Hepburn said:

“These figures highlight the uncertain economic times we are facing and the fact that more Scots are finding themselves without enough to live on.

“The economic damage caused by Brexit and the challenges of the roll out of Universal Credit bear much of the blame.

“In this climate it is ever more important for people encountering financial difficulty to seek early advice and the appropriate solution.

“At this time during the post-Christmas period when finances may have been stretched I would encourage those who are struggling to seek free and impartial advice at the earliest opportunity to address the problem before it gets out of hand.”

The Scottish Government has recently published a consultation on PTDs focusing on concerns they may not always present the appropriate solution for all individuals signing up to them or whether they consistently strike the right balance between the interests of creditors and those dealing with debt.

Scottish corporate insolvencies were up slightly on the same period a year ago with 209 recorded for the third quarter this year, eight more than the same quarter in 2017-18.

This number included 129 compulsory liquidations, 80 creditors’ voluntary liquidations and 122 members’ voluntary liquidations. No receiverships were recorded in the last quarter.

Scottish Insolvency Statistics (Oct-Dec 2018): Comment from R3

Commenting on the Scottish Insolvency Statistics, October to December 2018, Tim Cooper, Chair of R3 in Scotland, the insolvency and restructuring trade body says:

Personal insolvencies:

· Overall, personal insolvency numbers in Scotland for the whole of 2018 were 14% higher than in 2017, and were at their highest level since 2013.
· The number of personal insolvencies (bankruptcies and protected trust deeds) in Scotland rose by 4% in October-December 2018 compared with July-September 2018, and rose by 18% compared with October-December 2017.

“Annual numbers of personal insolvencies in Scotland have been rising every year since 2015, and 2018 continues this trend. In line with this, R3’s members in Scotland reported increased activity levels in dealing with financial distress across 2018.

“Ten years on from the start of the global financial crisis, many people have reached the limits of their borrowing capacity, and are – put simply – tired of being in debt. Debt consolidation and zero-percent interest rate credit cards will only go so far, and larger numbers of people are seeking a fresh start through a form of personal insolvency, rather than continuing in a holding pattern with interest and charges building little by little.

“Although the Scottish unemployment rate recently hit a record low, this does not tell the whole story; 22% of Scots aged 16-64 are counted as economically inactive, and not included in the jobless rate, for example. Recent years have also seen rising numbers of people in work but below the poverty line.

“The UK inflation rate generally decreased over the course of 2018, giving a small measure of relief to squeezed budgets, and the fall in fuel costs towards the end of the year will also have helped. However, this easing of fuel prices and the overall inflation rate comes off the back of a long period of rises, which will have put pressure on budgets.

“While this rise in personal insolvency is troubling, there is a silver lining in that there has been, to an extent, a shift in the culture around debt. People now are more willing to talk about their personal finance problems, and to seek help and advice, rather than bottling everything up until it escalates to a degree that can no longer be ignored. There is more progress to be made on this, but anything which makes it easier for people to address financial problems is to be welcomed. The sooner that someone in financial distress reaches out for help, the more can be done to resolve their situation.”

Corporate insolvencies:

· Overall, corporate insolvency numbers in Scotland for the whole of 2018 were 21% higher than in 2017, and were at their highest level since 2012.
· The number of corporate insolvencies in Scotland fell by 10% in October-December 2018 compared with July-September 2018, and rose by 4% compared with October-December 2017.

“It’s not especially surprising to see corporate insolvencies in Scotland at a higher level in 2018 than in the previous year, as 2017 recorded the lowest number of annual corporate insolvencies for quite some time. It is also worth noting that we may not be seeing the whole picture, as the statistics do not include administrations or company voluntary arrangements, nor the number of companies which were rescued outside of a statutory insolvency procedure.

“That said, the year on year increase in liquidations is nonetheless concerning. Consumer confidence in Scotland has been firmly in negative territory all year, and – as the higher number of personal insolvencies in Scotland confirms – many people are at the reaches of their personal budgets with no extra cash. Companies which are counting on consumer spending to at least match previous levels may well find themselves counting the costs of this approach. In the North East, the oil and gas sector downturn has had a noticeable ‘domino effect’, triggering insolvencies for businesses which rely on the extraction sector, especially in the hospitality sector.

“Scottish business experienced uncertain conditions over 2018, not least due to the uncertainty around how, when, and under what terms the UK will leave the European Union. Investment decisions have been deferred in many cases, and companies which rely on resources or components imported from or via the European Union have had to prepare for a range of scenarios. Some companies will have had to put working capital into stockpiling materials, adding to pressure on cashflow.

“The health of small and medium-sized enterprises is key to the health of the Scottish economy. Scotland’s corporate scene is predominantly ‘SME’-based, notwithstanding the presence of several large companies, and smaller companies often require a different kind of support. Director education, for example, could be a worthwhile investment, with R3’s members reporting that a lack of director training contributes to numerous insolvencies of SME businesses.

“In general, R3’s members in Scotland are reporting increased activity, across a variety of sectors. This indicates that market conditions are bubbling and problems are rising to the surface, with more business, creditors and individuals turning to restructuring and insolvency professionals to help them out. Acting sooner rather than later when problems arise can make all the difference, as it is highly unlikely that ignoring a business problem will make it go away.”

Qualco UK confirms partnership with Harlequins

Harlequins can confirm Qualco UK as an Official Business Partner in a deal that runs until 2022.

Qualco, a provider of asset management software and solutions to the credit industry, is partnering with the Club to engage with a wider audience, enhance brand recognition and raise awareness of the link between financial hardship and mental well-being.

Christian Jacob, Managing Director at Qualco, said: “The Qualco Panel engage with our clients’ customers, many of whom are in financial hardship every day, and we work hard to support them in ensuring these customers are treated fairly and offered the best path back to financial health.

“We believe financial education should begin at school to ensure the next generation grow up to manage their money better. It is this synergy we share with the Harlequins Foundation, which tackles inequality, poor health and the challenges facing the most vulnerable in society, that made the Partnership an obvious choice. We look forward to working together with the Club over the next three seasons.”

Harlequins Commercial Director Alex Goldschmidt said: “At Harlequins not only are we committed to growing the brand and developing innovative commercial opportunities, we also place great value on mental well-being and we believe Qualco’s ethos aligns perfectly with what the Club are trying to achieve. We look forward to a long and successful partnership with them.”

Qualco will stage its 2019 Qualco Live interactive event at The Stoop on Thursday, 6th June 2019. This year’s theme will be ‘Mental Health & Financial Hardship’, following the success of previous events which focussed on Artificial Intelligence, Analytics and Open Banking. Business leaders are invited to enjoy a day of engaging panels and thought-provoking breakout sessions.

Harlequins Director of Rugby Billy Millard will deliver insight into the seismic change rugby union has experienced since it turned professional in 1995, and the correlations with the evolving landscape of the UK credit industry during the last 10-15 years. Marc Leckie, Head of Foundation at Harlequins will also speak, offering his view on how we can collaboratively help the most vulnerable in society.

Tungsten Network launches Workflow 5.0

Tungsten Network, the global business transaction network, has released a new version of its Workflow product.

Tungsten Network Workflow automates accounts payable processes, enabling incoming invoices to be automatically routed, coded, matched, approved and posted into their Enterprise Resource Planning (ERP) system via an integrated connection. It offers users a single reference point from which they are able to track invoices, monitor cash flow and respond to vendor inquiries relating to the status of their invoices.

The latest version introduces a range of new features, like a new reporting tool replete with options to make it even easier to create robust, comprehensive reports. The new application performs faster and has an entirely new look and feel, allowing for a more intuitive user experience. It is also available on mobile devices, so users can manage their invoices more dynamically.

Tungsten Network Workflow 5.0 is currently available to existing Tungsten Network customers and is currently in its pilot phase with a number of these, including Honda Logistics. It will be available to new customers from February 2019.

Rick Hurwitz, Tungsten Network’s Chief Executive, said: “As we embark on a new year it is exciting to bring a brand-new version of Workflow to the market. Developed in close consultation with our customers, they believe that this latest iteration represents an improved user experience and feature set. Initial reception from pilot users suggests that the new product will be a great success.”

Brad Gerritsen, Honda Logistics’ Accounts Payable Supervisor, said: “The Tungsten Network Workflow platform gives us a clear picture of our open liabilities so we can make better payment decisions. We now have increased flexibility in handling our vendor payments. Additionally, with full visibility into our outstanding liabilities and greater efficiency in processing and paying our AP invoices, we can refocus our resources on working with our vendors on dynamic discounts and more favourable payment terms. We’re excited to experience what the new Workflow version 5.0 has to offer to make our AP Automation even more efficient and further enable improvements to our cash flow management.”

Centtrip helps companies prepare for Brexit

Centtrip, the international payments, treasury management and foreign-exchange specialist, has launched a dedicated Brexit desk to help businesses plan for further uncertainty and avoid future risks, costs and disruption.

Centtrip’s new specialist team will be on hand to analyse the current economic and political landscape, evaluate its impact and devise an efficient foreign-exchange and international payments strategy, helping clients navigate the choppy waves of Brexit and prepare for all eventualities.

A survey by Centtrip of 500 medium-sized and large companies highlighted the need for specialist support, with the average spend on international payments by each firm amounting to £978,000 over the past 12 months.

Foreign exchange is also a big expense for many firms that pay their clients and suppliers across the globe or process staff expenditure from overseas business trips. Centtrip’s survey also showed that 89% of respondents have a need for foreign exchange, and this number rises to 93% among larger companies.

Yet, almost two-thirds of businesses have yet to carry out a risk assessment on the impact of Brexit, according to the British Chambers of Commerce1.

Stephen Hubble, Chief Analyst at Centtrip, said: “Indecision seems to be the flavour of Brexit. Having spoken to a number of our clients, the common question is whether businesses can survive a further drastic decline in the Pound predicted by the Bank of England if the UK crashes out of the European Union without a deal. We are here to help businesses prepare for potential outcomes through in-depth analysis of the current and evolving geopolitical landscape.”

For the Record: storm® Platform Boosts Security Compliance with Advanced Screen Recording

Leading global cloud contact centre technology provider, Content Guru, is launching new screen recording capabilities for its customers around the world, via the storm® platform. Whether deployed independently to recreate the flow of a digital interaction, or replaying screen activity in conjunction with audio recording, this new capability provides organisations with an expansive view of contact centre operations, enabling them to better understand their agents and optimise customer engagement by improving agent training and enabling scenario reconstruction around disputed events.

Content Guru’s new product announcement enables its customers to comply with increasingly strict global requirements for policing of consumer and citizen engagement. Across all sectors, particularly financial, government and healthcare, more organisations are legally required to provide full visibility over their customer interactions. Directives such as the Markets in Financial Instruments Directive II (MiFID II) place penalties on companies that cannot prove they have offered suitable and appropriate client advice. The introduction of the General Data Protection Regulation (GDPR) in May 2018 furthered the requirement for organisations to monitor customer engagement, as contacting people without their explicit consent could result in fines of up to 2% of global annual turnover. Furthermore, organisations with enhanced security needs, such as those in central government and the financial sector, require access to historical recordings in the event of legal investigations. storm’s new recording solution supports compliance to these evolving regulations, enabling organisations to record, store and replay screen activity, simultaneously with audio where required, all via a simple, easy-to-use platform.

Despite the cost and operational benefits associated with screen recording, many organisations have historically been deterred by the significant bandwidth required for video storage. With storm, agents can conduct customer interactions via any channel, from voice and SMS to social media, email and webchat, all from a single interface. All interactions are compressed into a single compact file, meaning that screen recording could take up even less space than an audio call. With the flexibility to support organisations that store data in premise-based systems or in the cloud, screen recording becomes accessible to organisations of any size. Furthermore, Content Guru’s new development provides contact centre supervisors with greater visibility over agent behaviour, allowing them to understand the strengths and weaknesses of individual agents and identify areas for training and improvement.

Content Guru’s Product Director, Richard Manthorpe, commented on this new storm feature: “We are delighted to be offering screen recording capabilities to our customers to complement their existing storm deployment. Given the evolving technological and regulatory landscape, this was a natural progression for our company. The new solution supports our customers in meeting regulatory requirements in today’s omni-channel environment, whilst providing greater insight into agent behaviour so that quality can be improved.”

Arvato Financial Solutions UK Appoints new CEO

Arvato Financial Solutions has appointed a new CEO for the UK market

Debbie Nolan FCICM (grad), who has spent the last 1.5 years as Commercial Director for AFS will take up the position with immediate effect. 

Arvato Financial Solutions provides professional financial services to renowned international brands as well as respected local businesses. Its primary focus in the UK is Debt Collection.

Debbie joined Arvato in 2013 in a sales role with the CRM part of the business and prior to joining Arvato, spent 12 years at Wescot Credit Services, which included four years on the board. She also led the growth of global customer experience specialist Transcom, where she helped the brand expand by targeting new industry sectors.

Oliver Kuhaupt, Executive Vice President, Debt Purchase & International Collections said: “Debbie has a strong track record of delivering success for businesses across a range of sectors and is already recognised as the face of AFS within the UK market. Combining over 30 years of experience in collections and recoveries  with a well established reputation for delivery within the Arvato group means that Debbie is ideally placed to drive the UK business through its next phase of growth.”

Debbie added: “I am incredibly excited to accept the opportunity to drive the strategical objectives of AFS in the UK. Over the last couple of years we have had to place our focus on restructure and consolidation. Now we are in the exciting space of being able to focus on business growth and extending our digital capabilities”.

European NPLs reach peak year in 2018 with EUR 205bn in GBV

The European non-performing loan (NPL) market reached a new peak in 2018 with disposals totalling EUR 205.2bn in gross book value (GBV), according to the new European NPL FY 2018 report, published by Debtwire ABS.

Debtwire NPL Database tracked 142 transactions. The last quarter saw a particularly intense pace of activity, given that at the end of 3Q18, closed deals totalled EUR125bn.

The most active country by far was Italy, which produced half of the total volume of NPL sales. In 2018, Debtwire identified 64 closed NPL sales with a gross book value of EUR 103.6bn, almost half of which were via securitisations within the government’s Garanzia sulla Cartolarizzazione delle Sofferenze (GACS) scheme, which runs only until 6 March 2019.

Sales have started to slow down in Spain as the large Spanish banks near the end of their balance sheet clean-ups. However, a massive EUR 43.2bn was completed in 2018 across 27 deals and most of these have involved two jumbo buyers, Cerberus Capital Management and Lone Star Funds.

Material activity is starting to take place in other Southern European countries, still the ones with the highest NPL ratios, and market participants expect to see more in 2019. In 2018, Greek banks closed eight sales for a total volume of EUR 13.9bn, Portuguese banks closed 16 NPL and REO deals for a total volume of EUR 8bn and Cyprus saw two deals for EUR 2.9 bn.

In Ireland, there were eight deals for EUR 14.3bn, while in the United Kingdom the bad bank UKAR dominated the loan disposal market with GBP 5.8bn of sales out of a total GBP 6.5bn. Germany has also seen disposal of NPLs connected with troubled local banks. HSH Nordbank’s EUR 6.3bn portfolio, sold together with the bank to Cerberus, made up most of the EUR 7.7bn volume in the country.

“The NPL market has reached a peak that will not be topped in 2019. This is especially the case in Italy, where the GACS effect will slow down, with most large banks having already taken advantage of the program and now needing to focus on unlikely to pay (UTP) portfolios. Still, with European regulators pushing for banks to dispose of their bad loans quickly, activity will remain consistently intense across the continent,” said Alessia Pirolo, Head of NPL Coverage, Debtwire.

Mitek enables ANNA Money to increase new customer acquisition by 25% in 3 months

Mitek today announced that ANNA Money, the business-account app for startups and small businesses, has doubled the speed of its customer onboarding process and achieved its target of 25% more new customers in the digital channel in just three months – as a result of integrating Mitek’s Mobile Verify® digital identity verification.

“Our customer base of UK startups, sole traders and SMEs use our services to help their business cash flow. We support our customers with their financial admin, sending and chasing invoices to facilitate payments – but first, we have to onboard them efficiently and securely, and in compliance with Know Your Customer (KYC) regulations,” said Daljit Singh, Chief Design Officer at ANNA Money. “Our previous process had many roadblocks for onboarding new customers, and we were seeing abandonment rates climb.”

“As our customers take their first step on their entrepreneurial journey, we needed to provide a simple and efficient process,” Singh explained. “To do so, we required a much more flexible identity verification provider who could verify all types of ID – including driving licences and ID cards. In Mitek, we found a partner whose technology enables our customers to sign up to the service quickly, on the go, and without unnecessary bureaucracy.”

ANNA Money chose Mitek’s Mobile Verify®, and integrated this technology into their chatbot-style onboarding process in August 2018. Its intuitive customer experience guides customers to take accurate pictures of identity documents, to instantaneously assess the authenticity of the identity to accelerate the onboarding process and ensure regulatory compliance. “By improving our process and empowering new customers to use their chosen form of ID, we have doubled the speed at which we can onboard customers,” said Singh. “We have also been able to reach our target of increasing our customer base by 25% in only three months. We wouldn’t have achieved this important milestone without these improvements to our identity verification process.”

“Identity verification is vital to comply with regulation and protect businesses – but this doesn’t need to come at the expense of good customer experience,” said Rene Hendrikse, EMEA MD at Mitek. “Speed and flexibility are crucial for small businesses selecting new services, and ANNA Money recognised the need to provide this for new customers. We are delighted to support them on reaching their targets for customer growth, and are proud to play a key role in ANNA Money’s innovative services for small businesses.”