Artificial intelligence (AI) has the potential to transform financial institutions (FIs), disrupting every aspect of financial services, from the customer experience to financial crime.
One of the most compelling use cases for AI is in the battle against financial crime. AI has two primary benefits for the banks engaged in this battle: it can increase the effectiveness and efficiency of financial crime investigations, and the institutionalise risk management.
Financial institutions can employ AI to analyse large amounts of data, to filter out false alerts and identify complex criminal conduct. It can identify connections and patterns that are too complex to be picked up by straightforward, rule-based monitoring, or the human eye.
This raises four fundamental questions:
- Are financial institutions ready to embrace advances in ML to help uncover emerging patterns for preventing fraud?
- How can financial institutions harness expanded data typologies generated by new authentication processes for better fraud detection?
- How can financial institutions manage the data orchestration challenges to leverage different data sources, integrate with other information, and factor in decision making across the entirety of the customer journey?
- Are financial institutions benefitting from better data orchestration?
Enhancing Anti-Money Laundering Monitoring and Driving Operational Efficiency
Digital transformation and artificial intelligence are undeniably changing the Anti-Money Laundering (AML) landscape. The need to modernise AML processes, coupled with a regulatory push towards innovation, is driving financial institutions to enhance AML monitoring & drive operational efficiency.
The manual and semi-automated nature of current AML compliance efforts slow down processing timelines and impact business productivity.
The immense volume of data that financial institutions are expected to comb through to meet regulatory requirements to detect and report suspicious activity becomes a daunting challenge.
The data is usually diverse and subpar. It’s common for systems to use only a subset of available data when generating alerts. Traditional transaction monitoring systems are unwieldy to maintain and rely on rules and thresholds that are easy for criminals to test and circumvent.
Investigation processes tend to be highly manual, from gathering the supporting data for a case to submitting a complete SAR (suspicious activity report). Meanwhile, the money launderers are working night and day to remain hidden, constantly engineering new ways to conceal the flow of funds.
Traditional Anti-Money Laundering (AML) and Combating Financing of Terrorism (CFT) tools and tactics take longer and cost more than they should.
To fortify the defences more efficiently and rapidly, financial institutions need ways to:
- Automate tasks that formerly required human intervention, such as disposition of alerts
- Detect more risks and effectively prioritise them with sophisticated analytics techniques
- Provide richer context for investigations with access to more comprehensive insights
Financial institutions need to consider harnessing advanced analytics and AI technologies to enable a proactive, robust and unified strategy for enterprise-wide fraud and security intelligence.
Management must align fraud and cyber teams to increase cyber resiliency and minimise risk. They must deliberate how high-performance analytics and multiple detection methods can be used to monitor wider areas of risk in large volumes of data.
In the face of ever evolving and increasingly sophisticated cyber crime, integrating automation, AI and Machine Learning into financial crime programmes is essential. They facilitate more efficient transaction monitoring for suspicious activities and reduce false positives.
Developing new techniques for sound compliance practices for anti-bribery and corruption laws across jurisdictions is becoming more critical as technology moves fluidly across borders and international infrastructure.
Strategies to break down data silos, adjust to shifting regulations, and safeguard against present and future risks must form an integral part of critical event management strategy.
OpenGov Asia partners with key digital solution providers to explore how financial institutions can apply real-world AI and analytics applications to ensure a world-class integrated banking system that contributes to improve customer experiences, enterprise profitability, manage risk and regulatory compliance, anticipate fraud and create value from data.
The Indonesian manufacturing sector is seeing comprehensive changes in businesses across the spectrum, that is leading to accelerated progress to Industry 4.0 standards. This increased pace is being driven by efforts to increase productivity, efficiency and safety to adapt to the new normal brought about by the pandemic. Speaking at a virtual event, Webinar of Industrial Powerhouse in the Making: Invest in Industry 4.0, Director-General of Resilience, Territorial and International Industrial Access (KPAII) of the Ministry of Industry, Dody Widodo felt that current transformation efforts are critical to encouraging economic growth and competitiveness of the country.
Digitisation and technology have brought a marked improvement in the productivity of the domestic manufacturing industry after being hit by the COVID-19. As of September 2020, the utilisation of the manufacturing sector reached 55.3%, an increase of 15-25% from the previous 30-40% at the start of the pandemic. He was confident that efficient and effective digitalisation would connect companies with domestic and international markets through an integrated supply chain network. Countries that have low transformation performance characteristics will face high costs due to unreliable capacity and efficiency, as well as major barriers to integrating and competing in global supply and value chains.
Dody acknowledged the undeniable role of the internet has had in changing the way of doing business, including in the industrial sector. Industry 4.0 is driving the increasing trend of automation, such as through the Internet of Things (IoT), machine-to-machine and human-to-machine interfaces, artificial intelligence, digitisation in manufacturing, and other advanced technologies. According to him, the new paradigm shift in manufacturing today is the result of the use of the internet which allows real-time communication between machines and humans- leading to an era of smart products and smart services.
To prepare for the Industrial 4.0 era, the Indonesian government has launched a road map for Making Indonesia 4.0. Initially, there were five sectors that received development priority – food and beverages, textiles and clothing, automotive, electronics and chemicals. However, learning from the pandemic, the Ministry of Industry has added two critical sectors to be included in the Making Indonesia 4.0 program – pharmaceutical industry and medical devices. With this, there are seven priority sectors.
These seven sectors are key sectors in the world economy and Indonesia is striving to become one of the major global players in these. The main goal is to have Indonesia in the top 10 countries that have the strongest economy in the world by 2030.
OpenGov Asia recently reported on the Ministry of Industry’s launch of the Startup4industry programme as another concrete step to implementing the Making Indonesia 4.0 roadmap. The nation is confident that this strategic initiative will bridge the needs of industry and the community with the role of startups as technology providers. Startup4industry, built on the theme “Indonesia Is Confident in Domestic Technology” 2020 aims to deeply technology to have a positive social impact on citizens and mitigate the impact of the pandemic in the industrial sector.
Investment in Industry 4.0 technology will increase competitiveness and added value and, to that end, the government has carried out various strategic activities as part of the implementation of Making Indonesia 4.0. These include 2019 Indonesia Industrial Summit, preparation of Indonesia’s 4.0 Industry Readiness Index (INDI 4.0), the IKM e-Smart program and the appointment of an Industry 4.0 lighthouse company in Indonesia.
To attract investment related to industrial technology 4.0, the Ministry of Industry has proposed various incentives for industry players, including a super tax deduction of 300% for industrial companies investing in R&D (including technology 4.0) and 200% for industrial companies investing in vocational education.
Further, to maintain business continuity of the industrial sector in the country, the Ministry of Industry has granted an Operational Permit and Industrial Activity Mobility (IOMKI) for business actors who meet the requirements based on Circular (SE) of the Minister of Industry Number 4 of 2020, SE of the Minister of Industry No.7 / 2020 and SE of the Minister of Industry No.8 / 2020. As of October 2020, 18,183 IOMKIs have been issued for various industrial sectors with total employment of 5.15 million people.
The pandemic has caused widespread devastation across the world with cases inching towards 43 million even as the death toll crosses a million. The Philippines is also struggling to deal with the COVID-19. The country has recorded 370 thousand cases with fatalities touching 7,000 in this last week of October.
Researchers across the world are working ceaselessly to try and get a comprehensive picture of the virus, its epidemiology and management. Such large-scale, glocal research has been made possible with supercomputing facilities that can perform high-speed processing and computations.
Wide interconnectivity and global reach give it the capacity to empower multi-disciplinary efforts in medical and health research across facilities and experts spread across wide geographical areas. The incredible processing and analytic powers drive advancements in the development of treatments, vaccine and management of all diseases and pandemics, such as the COVID-19. Supercomputing facilities can process massive amounts of data, speed up simulations and provide large amounts of space need to store data and analytics. These capabilities allow access to virtual machines, massive cloud applications and coordination on a global scale – produce results a thousand times faster.
The Computing and Archiving Research Environment (COARE) is a supercomputing facility at the Department of Science and Technology-Advanced Science and Technology Institute (DOST-ASTI). The facility provides free services to researchers, scientists and students who need high computational resources, access to virtual machines and data archiving services. Currently, COARE has allocated its resources to institutions and researchers dedicated to dealing with COVID-19.
FASSSTER and TanodCOVID
Developed by the Ateneo de Manila University’s Ateneo Center for Computing Competency and Research (ADMU-ACCCRe) and in collaboration with the University of the Philippines Manila-National Telehealth Center (UP-NTCH) and the Department of Health-Epidemiology Bureau, the Feasibility Analysis of Syndromic Surveillance using Spatio-Temporal Epidemiological Modeler (FASSSTER) is a pandemic intelligence monitoring that assists the government’s real-time decision-making processes for COVID-19.
FASSSTER’s data warehouse features multiple modules used for collating, storing and filtering real-time information sourced from various health records and reports. Data from the warehouse is fed to a dashboard that produces analytical projections and computations that help decision-making processes and disease response.
One component and data source of FASSSTER is TanodCOVID, which helps people track and monitor COVID-19 symptoms and report it to their local health authorities through a self-reporting tool. Since March 2020, the COARE facility has been of crucial help to FASSSTER and TanodCOVID, providing access to its virtual cloud services to help them in their complex mathematical models and data warehouse needs.
COVID-19 Operations Center Monitoring System
The COVID-19 Operations Center Monitoring System is a data platform used by Local Government Units to help in management, tracking and monitoring of COVID-19 cases. The system consolidates COVID-19 data that is easily viewed on a dashboard. It includes visualisation features like heat maps and charts for monitoring at the municipality up to the barangay level and modules for encoding patient information and assigning patient records for contact tracing. COARE assists this platform by storing and analysing data through virtual servers.
Philippine Genome Center Research Initiatives
The Philippine Genome Center (PGC) of the University of the Philippines-Diliman is a genome-focused institution that currently prioritising research on COVID-19 – centred on phylogenetic analysis, computational studies, evolutionary analysis, molecular biology and in silico detection of COVID-19. COARE supports PGC by providing researchers access to the facility’s supercomputing services.
Folding@Home is an R&D project that helps combat worldwide diseases through research carried out through distributed computing. From March 2020, COARE offered its supercomputing resources to F@H research efforts by installing a dedicated folding node. Through this node, the project was able to utilise COARE’s resources for computational drug design, protein folding, molecular dynamics, and other COVID-19-related computer simulations.
University of the Philippines Cebu’s CovCheck Application
The Department of Computer Science and the FireCheck team of the University of the Philippines Cebu is developing a web application, CovCheck, that enables Local Government Units to manage and respond to the transmission of COVID-19 through the collection of data from constituents who have self-assessed and self-reported for COVID-19 symptoms. At present, COARE has helped by hosting the web application on its virtual servers.
ACCELER8 Project for SARS-CoV-2 Therapeutics
Faculty members and scientists from the University of the Philippines-Manila, Philippine Genome Center-Mindanao, and De La Salle University Manila are working on a research project – Advancing Antivirals through Combined Computational Design and Emerging Omics to Leverage Repurposed and Natural Drugs for SARS-CoV-2 Therapeutics (ACCELER8). COARE has given ACCELR8 researchers access to its supercomputing services to help them conduct simulations and data analysis on computational drug design and omics.
The federal government announced the establishment of a new industry advisory committee to help guide the implementation of its Cyber Security Strategy 2020. The Industry Advisory Committee will provide advice to the government through regular meetings and report directly to the Minister for Home Affairs.
The 2020 Cyber Security Strategy is firmly focused on protecting families and businesses, especially as they spend more time online, both at home and in their workplaces, the Minister for Home Affairs said. The Committee brings a wealth of experience from both the public and private sector that will build on the success of the Industry Advisory Panel and ensure the industry will continue playing a vital formative role in shaping the delivery of actions set out in the Strategy.
The work of the committee will be essential in light of the key role connected technologies are expected to play in Australia’s post-COVID recovery. While daily life is increasingly connected by digital technologies, more abundant and better-resourced cybercriminals and cyber-activists and increasingly sophisticated and emboldened state actors mean Australia is quite literally under constant cyberattack.
Meeting that challenge requires Australia’s cyber defences to be strong, adaptive and built around a strategic framework that is coordinated, integrated and capable — the 2020 Cyber Security Strategy provides that framework.
The committee will be chaired by the CEO of an Australian telecommunications company fresh off his stint as chair of the industry advisory panel that shaped the development of the new strategy. Meanwhile, the Chair of Australia’s sovereign cloud Infrastructure-as-a-Service (IaaS) provider will serve as Deputy Chair.
The new committee also has two other industry advisory panel members and joining these experts on the panel will be Cyber Security CRC CEO, the CEO of an Australian cloud, data centre, government cybersecurity and telecom company, and the Chairman a firm that provides real-time detection and ranging of objects and events.
Boosting cybersecurity government-wide
On a state level, the NSW government aims to streamline and standardise how agencies go about sourcing cybersecurity contractors by establishing a series of government-wide buying arrangements.
The Department of Customer Service this week approached the market to set up cybersecurity purchasing arrangements (CSPAs), as the need to secure the state’s digital services continues to increase. The arrangements will seek to overcome undisclosed “issues associated with the procurement of cybersecurity professional services to date”, and “ultimately facilitate cybersecurity uplift” across government.
Services expected to be covered by what will in effect be a panel include incident response, vulnerability assessment, maturity assessment, digital forensics, penetration testing and generic cybersecurity professional services.
This move comes in preparation for the government’s parliamentary inquiry into its handling of cybersecurity following a series of high-profile breaches, including an email compromise that saw 738Gb of data, or approximately 3.8 million documents, lifted from Service NSW.
The CSPAs will give agencies the confidence that they are procuring services from “capable suppliers” that have met a set criterion that ensures services are “fit for purposes” while minimising complexity.
This will involve “standardising the definition of services such that they are more easily understood by both buyers and suppliers allows for better comparison”, tender documents state.
The arrangements will also build on the government’s IT consultant fee caps introduced earlier this year by ‘locking in’ pricing. Suppliers will be expected to agree on “cost structures at the establishment of the CSPAs” to provide “confidence in the cost of engagements”.
The CSPAs will sit alongside the whole-of-government Cloud Purchasing Arrangements (CPAs), which were introduced by the department earlier this year to simplify public cloud procurement.
The University of Wollongong’s (UOW) SMART Infrastructure Facility will play a vital role in the new Illawarra-Shoalhaven City Deal prospectus, which aims to provide a vision and program to drive the transformation of the region and its economic recovery in the wake of the COVID-19 Pandemic.
The Illawarra-Shoalhaven City Deal brings together four councils and eight partner organisations – including UOW and the SMART Infrastructure Facility – in a shared vision for the region.
It is a vision that will deliver transformative change to the region, generating more than 12,000 high value add jobs in areas such as advanced manufacturing, professional services and technology, and enabling a more robust, more diverse Illawarra-Shoalhaven economy.
The proposed Illawarra-Shoalhaven City Deal initiative provides an opportunity to build from the existing Western Sydney City Deal to accelerate this growth relationship while also delivering important local infrastructure, facilities and jobs for the 420,000 people who live right here in our wonderful coastal region.
In addition to delivering 12,550 jobs over the next decade, the Illawarra-Shoalhaven City Deal:
- Creates growth for the Illawarra-Shoalhaven economy, and supports the growth of Greater and Western Sydney;
- Provides targeted transformative infrastructure projects that support a connected, diverse and resilient economy;
- Unlocks a recovery of the bushfire-ravaged visitor-economy for Shoalhaven;
- Develops the Circular Economy with a world-class waste reduction project;
- Creates a pipeline of Smart City projects, improving our overall economic resilience;
- Supports enhanced liveability for 70,000 plus households in the region and to South-Western Sydney, including Wollondilly and Campbelltown.
SMART’s Chief Operating Officer stated that the facility already works closely with industry and local government on projects that enhance the economic value across the region, such as Smart Waterways Management Project and the South West Illawarra Rail Link (SWIRL) report.
This City Deal states a clear vision moving forward and provides a roadmap for everyone to work towards, she said. The prospectus includes a pipeline for implementation and delivery of smart city projects which will deliver high liveability impacts for the region.
The vision and program outlined represent a considered and confident package of initiatives that can drive the transformation of the Illawarra-Shoalhaven and position the region for economic and employment recovery, he said. Considerable effort and collaboration by key organisations, including UOW, has been applied to define and agree on a suite of initiatives that address transport infrastructure, the visitor economy and economic resilience across Wollongong, Shellharbour, Kiama and the Shoalhaven.
Federal and State Governments rightly encourage regional communities to take charge of defining their aspirations and charting a course of action. Leaders in the Illawarra-Shoalhaven have risen to that challenge. Now the team seeks the support and investment of the Government as well as their collaboration in delivering jobs growth and improved liveability for communities.
Job creation in Advanced Manufacturing is targeted through the expansion of the Albatross Aviation Technology Precinct at Nowra. Better road and rail access resulting from the Illawarra-Shoalhaven City Deal will attract investment in manufacturing, green energy, ICT and tourism in the bushfire affected South Coast.
The delivery of the projects in the proposed Illawarra-Shoalhaven City Deal will have a transformative impact on the regional economy. The strategic objectives of the Illawarra-Shoalhaven cities are to create over 12,550 high-quality jobs in the next decade by delivering investment in key industries that attracts new businesses and retains employees as residents in one of Australia’s most liveable regions.
The growth potential is currently constrained by a lack of investment to unlock the local economies. Additional investment from Federal and NSW governments in transformative infrastructure will allow the Illawarra-Shoalhaven to reach its full potential as a much needed ‘release valve’ for a congested Sydney.
IIT Kharagpur’s Centre of Excellence in Advanced Manufacturing Technology has set out to bring to the forefront indigenously developed industry 4.0 technologies that support India’s industrial sector to achieve the vision of an Atma Nirbhar Bharat (Self-reliant India). Indian Institute of Technology Kharagpur (IITK) was the first-ever Indian Institutes of Technology to be established and is recognised as an institute of national importance.
The COVID-19 pandemic has necessitated significant staffing restrictions with new hygiene norms and social distancing. In this new normal, cloud infrastructure, remote and real-time operations systems will be critical to maintaining effective industrial operations. Furthermore, the advantages that controlled operations bring in delivering quality output at low costs have a wider impact in the context of Atma Nirbhar Bharat (Self-reliant India).
The institute recently developed novel Industry 4.0 technology for remotely controlled factory operations and real-time quality correction during industrial production, in partnership with an Indian multinational information technology services and consulting company, to set a new trend in India’s advanced manufacturing sector.
The innovative technology has been developed by Prof. Surjya K Pal, Professor in-charge at the Centre of Excellence in Advanced Manufacturing Technology jointly with the information technology services and consulting company, will acquire real-time information about the welding process through multiple sensors and enable online control of weld quality through cloud-based communication with the friction stir welding machine.
Stressing the need for such technologies to achieve the ‘Make in India’ goal, Director Prof. Virendra K Tewari believes that while India is aiming to boost indigenous production and exports, the primary goal should be the quality output with minimum disruptions. He felt that these are the two basic needs our industrial sector which must be addressed for servicing business to scale.
The innovation upgrades the industrial process of friction stir welding to a multi-sensory system of Industry 4.0. The process has set the course for remotely controlled operations in the Indian industrial sector and, at the same times, has enabled real-time quality check and correction during the production process. This will make it possible for industrial houses to achieve standardised quality goals throughout the production process and reduce rejection hence lowering the cost of production.
Welding is at the heart of any industrial operations. If we can improve the weld quality in real-time during batch production we can reduce rejections in post-production sample checks,” opined Prof. Pal.
Explaining the new technology, he revealed that the multiple sensor process involves a range of signal processing and machine learning techniques that predict the ultimate tensile strength of the weld joint is fabricated. This technology is connected with a vast experimental knowledge base to conform to a standard system and prediction of the weld joint strength. Any defect identified during the monitoring procedure is corrected in real-time by sending modified parameters to the machine thus ensuring the standardised quality of the process.
The concept of this technology can further be evolved for real-time control of other industrial processes and such work will be carried at the centre with other industrial partners soon, affirmed Prof. Pal.
IITK’s industry partner believes that such innovations are enablers of technology-based transformations in the country, especially in overcoming challenges called out by the pandemic. The remote friction stir welding machine quality control via multi-sensor fusion developed by Centre of Excellence in Advanced Manufacturing Technology at IIT Kharagpur is a case in point
The Executive Vice President and Chief Technology Officer said their organisation convinced that academic partnerships are an important part of their Research and Co-Innovation Network (CoIN) in creating real-world solutions with scientific rigour. He confirmed that their Embedded Systems & Robotics, IoT and ICME platform teams from their Research and Innovation wings were working closely with IIT Kharagpur’s CoE towards AI-driven prediction/control of weld strength using a scalable and robust platform.
The SG Women in Tech movement (SGWIT), an initiative by the Infocomm Media Development Authority (IMDA), industry, government and community partners to attract and develop girls and women in tech, celebrated its 1st year of advancing diversity in the tech sector in Singapore this week.
Some of the key milestones include:
- Connecting girls in schools with female tech leaders through a series of StudentsAsk videos that have since reached out to over 115,000 people in the community
- Bringing together over 600 women in the tech workforce for networking and mentoring activities
- Launching the inaugural SG 100 Women in Tech List to honour women who have achieved outstanding accomplishments and made significant contributions in tech.
Study finds women in tech in SE Asia is higher than global averages
To provide more insights on the strategies that companies, governments, schools and individuals can take to advance gender diversity, The Boston Consulting Group (BCG) has partnered with SGWIT and IMDA on a new study which surveyed 1,650 women in tech in Southeast Asia.
The study found that the participation of women in tech in Southeast Asia is slightly higher than global averages, and about 65% of respondents agreed that the tech sector does better than other industries in offering programmes specifically tailored to recruit, retain and promote women.
“More talent will drive the fast growth of our burgeoning tech sector and spearhead digital transformation for the Singapore economy. It is heartening to see the strong interest and support for the Singapore Women in Tech movement from schools, industry and community. We are glad to see tech companies and leaders taking action to attract, retain and develop girls and women in tech, and look forward to bringing on board even more stakeholders to develop an exciting and enabling environment for women in tech,” said Mr Lew Chuen Hong, Chief Executive, Infocomm Media Development Authority (IMDA).
Report identifies areas to boost the number of women in tech
With demand for digital talent growing faster than supply, the report identified three critical junctures for intervention to boost the number of women in tech. These “moments of truth” are the choice to pursue higher education in tech, the selection of their first job, and the decision to remain in tech over the long term.
Based on these, the report has also identified areas where companies, policymakers and academic institutions, and even women themselves, can work on, to further attract, retain and develop more women in tech.
BCG’s global leader for the Technology, Media & Telecommunications practice, Vaishali Rastogi, said, “Technology is radically disrupting businesses and industries, driving an urgent need for more digital talent across the region as demand for such profiles rises faster than supply. Women need to be part of the long-term solution.” Vaishali, who is one of the authors of the BCG report, further explained, “Our research shows that gender diversity can make companies more innovative and agile. For example, companies where women account for more than 20% of the management team have approximate 10% higher innovation revenues than companies with male-dominated leadership”.
Senior Minister of State for Communications and Information, Ms Sim Ann, also announced the extension of the MentorConnect programme for a second year at a webinar organised by SGWIT to commemorate its first anniversary.
The cross-company mentorship programme was started last year by Dell Technologies as a platform to guide and empower the development of women professionals in tech and promote best practices among participating companies from all industries. The programme will see four new companies, DBS Bank, VMWare, Aon, and BHP, joining the current ones – Dell Technologies, IMDA, Salesforce and ST Engineering.
Having battled the global pandemic for more than 6 months and foreseeing its lasting impact in the times to come, it is important to ask how prepared we are for the life after COVID–19. What are some of the valuable lessons that we have learnt in the past few months that we must take with us as we venture into the ‘new normal’?
In an attempt to discover and delve into the answers to these questions, OpenGov Asia hosted an OpenGovLive! Virtual breakfast insight with financial industry executives based in Indonesia.
The timely and thought-provoking issues saw a 100% attendance and high engagement rate from the audience for the session.
Balancing digital transformation along with managing fraud and risk is a major challenge for banks
Mohit Sagar, Group Managing Director and Editor-in-Chief, OpenGov Asia set the tone for the discussion by pointing out that the new, transformed workspace is no longer a physical place that employees go to but a cluster of virtual work tools that lets employees stay productive anytime and anywhere.
This free and flexible style of working has posed a major challenge for the financial sector industry. They are under a lot of pressure to balance their digital transformation efforts with the increasingly stringent regulatory guidelines alongside managing stakeholder expectations.
Apart from being resilient, banks have to constantly ensure that they are compliant and not flouting any regulations to ensure their presence amongst other contemporaries.
Operational resilience, which was earlier a seldom-discussed topic in the boardrooms, has been elevated on the priority list of CIO’s.
Mohit also highlighted the fact that mere compliance is not enough to ensure survival in the post-COVID-19 world. Constantly pushing the envelope by innovating and thinking outside the box is more important than ever.
He left the audience with advice that to effectively manage these distinct aspects of their business, it would be expedient to seek help and support of partners who specialise in it and who can help them prioritise right in the new uncertain normal.
How SAS can help and support financial institutions in the post COVID era
After Mohit’s challenging opening, Anggaraini Rahayu, Director-FSI, SAS Indonesia, shared her insights on the topic.
Anggaraini began by explaining how SAS can support, help respond to sudden changes and mitigate risk for the financial institutions as they recover in the post COVID–era.
She shared that SAS is doing this by identifying the volatility in macroeconomic factors that are key drivers of change, building up data and analytics capabilities along the journey to recovery and getting ahead of the innovation curve and applying analytics for future strategies.
Anggaraini elaborated on the various trends and opportunities in the FSI that have emerged beyond the pandemic. They are enhanced focus on digital transformation, better integration of financial services to the monetary policies, the robustness of asset and liability management, heightened security risks and surge in contactless payments.
She also talked about the way SAS operates in the financial industry space by enabling effective operations and working with innovative solutions that are driving amazing outcomes for their customers. As SAS champions driving value from analytics, she some of their use cases across the financial institution value chain shared with the delegates.
Anggaraini delved into the biggest focus area of SAS I.e. risk management for banking and insurance industry. She shared with the delegates the details of the SAS fraud and security intelligence solutions and how it enables users to stay resilient and relevant in the post-COVID-era.
She concluded her presentation by sharing some successful implementations of the above-mentioned solution.
Speed of service delivery is of utmost importance in the new financial industry world
After Anngarani’s information-rich presentation, Gerard Mcdonell, Regional Solution Director Fraud & Security Intelligence, SAS came forward to share his perspectives with the audience.
In his very first slide, Gerard highlighted the importance of the speed of delivery in the post-Covid era. Banks and financial institutions are under a lot of pressure to meet the changing demands of their customers in this new world. The need to go digital for financial institutions in the current scenario comes with the downside of increased risk of financial crimes and fraud.
He underscored the need for speed by quoting Klaus Shwab, who said that in this new world it’s not the big fish that eat small fish but the fast fish eating the slow fish.
Gerard validated his statement by citing a recent example where a large European bank lost an opportunity to expand their market due to the lack of agility and velocity in their DNA.
He also echoed the sentiment that the pandemic has only exacerbated the situation for financial institutions forcing the unbanked population to make a leap to digital banking. This, on one hand, has added to the existing challenges for the banks but, on the other, has exposed them to a new customer base that they can tap on.
He went on to shed light on the ways AI can support them. They include accuracy and efficiency with compliance, quick identification of fraudulent transactions, fast and accurate credit scoring.
Gerard strongly advised the colleagues from the industry to embrace the latest advancements in AI to tap on this newly created customer base.
He concluded his presentation by sharing how SAS helped a major bank to significantly improve its fraud management by implementing the fraud management and credit authorisation solution together.
Learning to mitigate the effect of COVID-19 crisis in the financial sector industry
After Gerard, Alfanendya Safudi, Senior Vice President, Head of Credit Portfolio Risk at PT. Bank Mandiri shared his learnings with the delegates.
Alfanendya opened his slot by sharing that, just like the most of delegates and their organisations, Bank Mandiri had very limited visibility of the impact the COVID-19 crisis would have on the economy.
But early stress testing and contingency actions are key to mitigating the impact of COVID–19 outbreak. He ardently advocates stress testing as an effective way of mitigating COVID risk and also emphasised that the test needs to be updated frequently as well as supported by robust tools and systems.
He cautioned the delegates to not rely on a singular stress cycle and undergo multiple rounds of it as they did at Bank Mandiri.
Towards the end of his presentation, Alfanendya shared with the delegates how banks need to prepare as they move forward in the new normal. He also agreed that there is an increase in non-financial risks like fraud, scams, cyber-attacks etc. during the COVID-19 crisis that needs to be better prepared for in times to come.
After the informative presentations, it was now time for the more interactive part of the session: the polling questions and discussions.
On the question about your organisation having the tools to model out the P&L under a wide range of different economic and non-economic scenarios, a majority of the audience voted that they use traditional forecasting techniques, and they are good enough (77%).
One one of the delegated reflected that they are currently using the traditional techniques that are sufficient for now but they are also open to new technologies out there that can help them do it better.
On the question about the impact of the pandemic on their operational risk exposure, particularly relating to fraud and compliance, a major chunk of the delegates voted that increased online and application fraud, along with greater resource demands to keep AML/ KYC/ screening compliance under control have been impacted (50%).
A digital executive shared that increased online or payment fraud and application fraud are bigger impact areas in their organisation that they need to work on.
On the final question about the top priorities, while managing risk management portfolio, the delegates seemed divided between updating their legacy with a modernised risk infrastructure (36%) and using AI and machine learning for credit scoring, capital optimisation, back-testing and model validation and regtech (36%).
After the polling session, the Virtual Breakfast Insight reached a timely conclusion with closing remarks by Febrianto Siboro, Country Managing Director, SAS.
Febrianto began by thanking all the delegates and speakers for joining the session and sharing their insights with the audience. He encouraged the audience to make use of various AI/ML and analytics solutions by SAS to augment their service delivery and team SAS would be happy to entertain their queries and demonstrations for the same.