May 16, 2020

How is technology changing financial messaging?

Sean Galea-Pace
3 min
SWIFT: providing secure financial messaging services
SWIFT is a global provider of secure financial messaging services.

It is a network that allows financial institutions globally to send and receive info...

SWIFT is a global provider of secure financial messaging services.

It is a network that allows financial institutions globally to send and receive information and data about financial transactions in a secure and reliable manner. As of 2018, it was found that more than half of high-value cross-border payments worldwide used the SWIFT network.

History

SWIFT, which stands for the Society for Worldwide Interbank Financial Telecommunication, is headquartered in Belgium. Founded in 1973, 239 banks from 15 countries merged together to work towards a common problem: how to communicate about cross-border payments.

In 1977, SWIFT launched its messaging services and replaced the Telex technology, which was in widespread use at the time, becoming renowned as a trusted global partner for institutions worldwide. SWIFT was originally set up by and for its users to support international finance and commerce. Upon its 1977 launch, there were 518 institutions from 22 countries connected to SWIFT’s messaging services.

From the beginning, SWIFT has prioritised confidentiality, efficiency, security and reliability, with its operating systems ensuring the highest systems availability, redundancy and back-up capabilities. The company prides itself on its unique approach and strives to provide a better way for the global financial community to move value, reliably, safely and securely. 

SWIFT has a range of different solutions and carries more than five billion messages a year. At its core, SWIFT prioritises secure and reliable messaging, offering solutions that mitigate operational and compliance risks and keeping businesses safe.

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SWIFT2020

In 2015, SWIFT established a SWIFT2020 strategy that would see the organisation continue to focus on operational excellence in its core financial messaging services in order to meet customer expectations. “The digital revolution is in full force in the financial sector and our customers are influenced by new technologies, regulation and evolving expectations,” commented Javier Pérez-Tasso, chief executive of the Americas, UK, Ireland and Nordics at SWIFT.

“At the same time, new entrants are challenging and potentially disrupting the traditional business models of transaction banks. We see ourselves as innovative incumbents; we are proactively coming up with new technologies and platform innovation - particularly in the area of real-time payments and compliance - and we are working together with banks to consider ways of rejuvenating the correspondent banking model.”

SWIFT hosts an annual conference, called Sibos, which is aimed at the financial services industry. The event brings around 8,000 business leaders and industry experts from a diverse range of financial institutions, market infrastructures, multinational corporations and technology partners together. Offering hundreds of speakers, the event is regarded as an important conference to discuss strategies and share best practice in a dynamic sector. 


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Jun 10, 2021

FIVE things fintechs must do to keep investors onboard

Fintech
Investment
venturecapital
AI
Brandon Rembe, CPO, Envestnet...
4 min
Fintech innovations drew in first-time investors who reshaped the markets. What new advancements will help them continue their rise?

New investors flocked to the stock market during the COVID-19 pandemic. Thirty-eight percent of investors said they had never had a brokerage or similar account before opening one in 2020.

Low or no-fee trading options have helped accelerate the trend – nearly half of new investors said they accessed their account primarily through a mobile app. As FinTechs, how do we create the trust needed to keep new investors in the market and create a fruitful customer experience for them?

The financial industry does a disservice to individual investors if we merely offer tools that focus on making money quickly, an approach that usually backfires. Instead, the surge of interest presents an enormous opportunity for those who want to help more consumers use financial technology to educate them on responsible spending, saving, and investing in order to achieve financial wellness current fintech tools have welcomed individual investors in the door.

Now, it’s time to focus on education and improving their experience going forward. There are several ways those of us in fintech can step up to shape the future of retail investing so that it works better for everyone, starting with the following areas.

Equal access to financial wellness education

Financial health should be available to everyone — but today, not everyone has the educational resources to achieve it. One study shows that only 3.9% of students from low-income schools were required to take a personal finance class. What they aren’t learning in school or from family members, fintech companies can provide on their platforms.

The companies should move from solely offering financial services to a more responsible model of education, advice, and prescriptive choices to help consumers develop better habits and make wiser financial decisions. Not only can they empower consumers and bridge historical wealth divides, but they can also stimulate growth by opening up new consumer segments.

More personalisation

Just as we’ve come to expect that our fitness routines are tailored to our individual bodies, we’re also ready for finance tools that go beyond one-size-fits-all solutions. But only six percent of financial institutions say they’re using the kind of technology that allows them to deliver a deeply personalized experience. Fintech tools need to reflect that financial success looks different for each of us.

For one consumer, it may mean providing guidance on how to pay off student loans early; for another, it may mean prescriptive actions that enable them to stick to a budget for the first time; for a third, it could look like prioritizing environmental, social and governance (ESG) investments, so that her portfolio aligns with her political beliefs.

Now, we are seeing financial technology beginning to meet the demands of personalized finance in a substantial and meaningful way.

The rise of AI-Powered Advice

Big-picture advice and predictive guidance used to be a feature of high-end financial advisory firms — a perk only available to those who could afford it. But thanks to rapid advancements in data analytics and artificial intelligence (AI), that kind of holistic advice is now more accessible than ever. AI-driven robo-advisors can parse many different streams of financial information, delivering customized answers to key questions: Is it time to buy a home, or is it smarter to keep renting? Can I afford to take out another student loan?

Intelligent connectivity powered by AI can anticipate consumers’ needs and next steps, making proactive suggestions that guide them along the path to financial wellbeing. Fintech companies can also help consumers identify when their financial picture becomes too complex for a robo-advisor, and help them find a human financial advisor to meet their needs. 

Focus on financial mental health

New investors are quickly finding that the market can be overwhelming. That’s not surprising, financial anxiety is common and studies show that financial stress can have an impact on mental health for some.

It’s not enough for fintech companies to give retail investors access; they also must provide the guidance and support that help consumers manage their financial well-being. Educational tools can ensure that consumers are well informed about their options.

Predictive analytics can anticipate consumers’ questions, serving them key information and insights before they ask. Features that emphasize a comprehensive notion of financial well-being, rather than short-term wins and losses, can also help ensure that consumers are keeping their eyes on the bigger picture.

Gamification for good

The surge of gamification apps has done an impressive job making investing as engaging as playing a video game or joining a social media platform.

Much of the current use of gamification emphasizes short-term thinking, but there’s also an opportunity to help consumers think more broadly about their overall financial picture. One example is peer benchmarking, a feature that enables help consumers to see how their financial habits compare to those of friends and fellow consumers.

Gamification can also be used to incentivize making smaller, smarter choices — for example, rewarding saving over making an impulse buy.

The future of fintech is about more than just broadening access to the markets. It’s about making sure more individuals have access to the tools that can help improve their financial well-being—in the ways that suit their own circumstances and needs. The potential to act within their own set of individual priorities, with their long-term financial wellness in mind is much more empowering to a consumer than simply relying on short-term, high-risk investments.

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