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Future Trends in FSI

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As the financial services industry goes through fundamental transition, we see digitalization as becoming a critical success factor. This talk will cover trends around how cloud and web services can enable you to transform your operating platforms to provide your customers and partners with better experiences.

Published in: Technology

Future Trends in FSI

  1. 1. © 2016, Amazon Web Services, Inc. or its Affiliates. All rights reserved. Zane Moi, Head of Business Development HKT Michael Braendle, Principle Cloud Architect, Professional Services, HKT 2016/06/17 Future Trends in FSI How can web services help to transform your business?
  2. 2. Transformational Changes Changing customer behavior will continue to fundamentally transform FSI’s industry and require investments into the overall Customer Experience New compe)tors e.g. Fintech’s and disintermedia)on will put an increased pressure on the FSI’s and requires investment into innova8ve solu8ons Tighter regula)on will put more scru)ny on the FSI’s and business process, compliance workflow automa8on will become a key differen8a8ng factor New technologies e.g. Blockchain will disrupt incumbent business models, players and require banks to be able to integrate with the larger FSI ecosystem Cost and opera)onal risk reduc)on requires FSI’s investment into simplifica8on programs and drive the adop8on of and elas8c infrastructures
  3. 3. An API* approach for FSI *Application Programming Interface
  4. 4. Unbundling FSI Value Chains Monolithic Platforms Decouple by Layering Micro Services
  5. 5. Monolithic Core Banking Platforms Etc. Monolithic Architecture: •  Tightly-integrated core banking platforms •  Inefficient, hard-to-change core banking solutions •  Long, expensive change cycles •  Limited options for effective out-/in-source business capabilities •  Tight-coupling increases single point of failure and operational risk Reference Data Operations & Execution Risk & Compliance Etc. Customer Experience Tightly-coupled, hard-to-change legacy core banking platforms result in… …poor customer experience, slow innovation cycles and expensive IT platforms. Client Advisor Capabilities Client-facing Capabilities Core Banking
  6. 6. Decoupling by Layering Enterprise Service Bus Client Advisor Capabilities Client / eBanking Capabilities Etc. Enterprise Service Bus Architecture: •  Many companies use an Enterprise Service Bus (ESB) to decouple front end capabilities from legacy core banking solutions •  ESBs become critical dependencies •  Unclear business and IT cost ownership for the ESB - layer •  Performance bottleneck, single point of failure •  Minimal increased efficiency in time to market •  Increased complexity, introducing another layer Reference Data Operations & Execution Risk & Compliance Etc. Customer Experience Enterprise Services Buses are widely used to decouple core banking solutions… …but resulted in increased complexity, cost and minimal time to market increase. Core Banking
  7. 7. Adoption of Standard API’s Etc. Component-based, Service-oriented architecture •  Functional and information master components •  Use Application Programming Interface’s (API’s) to access information objects •  APIs implement functional and data access control •  Customer-facing applications become decoupled from the core banking platform •  Improved time market delivering a client and client advisor functionality •  No bulky ‘Integration’ layer and clear cost ownership •  Functionality and information accuracy is constraint by legacy core banking platform Customer Experience API’s are an efficient way to decouple client-facing business capabilities however… …the customer experience is still constraint by legacy core banking systems. Client Advisor Capabilities Client-facing Capabilities API API API API Reference Data Operations & Execution Risk & Compliance Etc. Core Banking
  8. 8. Adoption of Micro Services – API Banking Trade Execution Micro Service Architecture: •  Innovate faster by using standard APIs for application development •  Customer experience is based on a aggregation of micro services •  Loosely-coupled micro services integrate through standard APIs •  Elastic scaling of individual micro services •  Enable business to source capabilities in the most cost efficient way: •  Build business differentiating capabilities •  Source non-differentiating capabilities •  Increase agility by enabling teams to develop independently – Two Pizza Team Customer Experience Provide an integrated customer experience by aggregating micro services… …every banking service is a Application Programming Interface (API) API API API API Corporate Actions Anti Money Laundering Etc, Payment API API API API Client Information Suitability Rules Trade Capture
  9. 9. Micro Service Micro-service Software Modules (application, libraries, etc) Data Store (eg, DynamoDB, RDS, Cache, S3) Public API addProductDetails(ProductId id, ProductDetails details) removeProductDetails(ProductId id) getProductDetails(ProductId id) : ProductDetails Micro service = Service-oriented architecture + “small” public API
  10. 10. Micro Service Micro-service Software Modules (application, libraries, etc) Data Store (eg, DynamoDB, RDS, Cache, S3) Public API addProductDetails(ProductId id, ProductDetails details) removeProductDetails(ProductId id) getProductDetails(ProductId id) : ProductDetails Micro service = Service-oriented architecture + “small” public API
  11. 11. Web Of Micro Services Position and Transaction Customer Information Product Information Client Report / Monthly Statement Investment Proposals
  12. 12. Example of a Micro Services Architecture Virtual Private Cloud AWS Cloud Corporate Data Center Mobile apps API Gateway AWS EC2 Order Manager Suitability Rules AWS ECS Internet Customer Market execution Suitability check Market execution Buy AMZN AWS Direct Connect Legend: Micro services AWS Lambda Amazon S3 Order: Buy stock (AMZN) View Product Factsheet AWS RDS AWS RDS Market Data AWS DynamoDB Amazon CloudFront Get stock title information Public: Suitability Rules API API APIAPI
  13. 13. Example: Deployment at Amazon.com
  14. 14. The Impact of an API* Approach for FSI on Distribution *Application Programming Interface
  15. 15. Omni-Channel Distribution, Today Non-Technology Technology Insurance Banking Branch / Kiosk ATM Call Centre Direct Sales (Agent/CA) Web Mobile Credit Cards Agency/Broker Investment Direct Marketing Direct Bancassurance JV EFTPOS Non-Financial Service Retailers Indirect
  16. 16. Omni-Channel Distribution, in an API World Non-Technology Technology Insurance Banking Branch / Kiosk ATM Call Centre Direct Sales (Agent/CA) Web Mobile Credit Cards Agency/Broker Investment Direct Marketing Direct Bancassurance JV EFTPOS Non-Financial Service Retailers Indirect API GATEWAY Other 3rd Parties Family Offices Affiliates Non-Financial Digital Retailers
  17. 17. Opti-Channel Communications Non-Technology Technology Insurance Banking Branch / Kiosk ATM Call Centre Direct Sales (Agent/CA) Web Mobile Credit Cards Agency/Broker Investment Direct Marketing Direct Bancassurance JV EFTPOS Non-Financial Service Retailers Indirect API GATEWAY Other 3rd Parties Family Offices Affiliates Non-Financial Digital Retailers
  18. 18. What Is Opti-Channel Communications Communication via the right channels using the right media … with Context
  19. 19. Building Context Driven Engagement
  20. 20. Business Drivers Create business value from getting better customer insights and additional opportunities to engage and cross sell Scale your business by automa8on and using algorithms Experiment with advanced analy8cs and machine learning Build on a elas)c, scalable and cost-efficient data analy8cs plaBorm
  21. 21. Optimal Combinations of Interoperable Services Amazon Redshift Amazon Elastic MapReduce Data Warehouse Semi-structured Amazon Glacier Amazon Simple Storage Service Data Storage Archive Amazon DynamoDB Amazon Machine Learning Amazon Kinesis NoSQL Predictive Models Other AppsStreaming
  22. 22. Use Case: Automated Advisory Platform Customer Profile Position &Transaction Research Information Benchmark / Asset Alloc. Social Media Investment Proposal Investment Proposal Investment Proposal Portfolio Assessment Investment Proposal Suitability Checks Ingest/ Collect Consume/ visualizeStore Process/ analyze 1 4 0 9 5 Data Answers & Insights Automated Investment Proposal Customer Bank Client Advisor Portfolio Assessment Investment Opportunities Investment Proposal Customer Internet Etc.
  23. 23. Architecture: Automated Advisory Platform Ingest/ Collect Consume/ visualizeStore Process/ analyze Data 1 4 0 9 5 Amazon S3 Data lake Amazon EMR Amazon Kinesis Amazon RedShift Answers & Insights BI / Reporting Investment Proposal Investment Proposal Investment Proposal Customer Bank Client Advisor Internet Amazon Machine Learning Amazon DynamoDB Amazon S3 Portfolio Assessment Investment Opportunities Investment Proposal
  24. 24. Use Case: Automated Risk & Compliance Monitoring and Reporting Client Information Securities Transactions Payment Transactions Transaction Monitoring AML Monitoring Suitability Monitoring Ingest/ Collect Consume/ visualizeStore Process/ analyze 1 4 0 9 5 Data Answers & Insights Risk and Compliance Monitoring Etc. Order Manager Settlement System Etc. Bank Transaction Regulatory Suspicious Transactions Transaction Report Suitability Report Suspicious Transactions Etc.
  25. 25. Architecture: Automated Risk & Compliance Monitoring and Reporting Ingest/ Collect Consume/ visualizeStore Process/ analyze Data 1 4 0 9 5 Amazon S3 Data lake Amazon EMR Amazon RedShift Answers & Insights BI / Reporting Order Manager Transaction Report Suitability Report Suspicious Transactions Etc. Amazon S3 Settlement System Etc. Amazon QuickSight Bank
  26. 26. Distributed Ledger Technology
  27. 27. AWS and Distributed Ledger Technology AWS operates: 12 Regions 33 Availability Zones 53 Edge Locations •  AWS collaborates with Digital Currency Group and it’s associated startups •  AWS provides DCG companies a secure environment to experiment with the technology •  DCG companies include: Chain, RSK Lab, BigchainDB, Blockstream, Everledger and Onename
  28. 28. Remember to complete your evalua)ons!
  29. 29. Thank You!

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