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Banking’s Digital Imperative: Navigating Declining ROE and the Path to Profitable Transformation

Posted on by Wenting Chen

Whitepaper

Banking’s Digital Imperative

Navigating Declining Return On Equity and the Path to Profitable Transformation

Banking ROE projected to fall below 7.2% by 2030

The global banking sector faces mounting pressure as Return on Equity (ROE) continues to decline. Incumbent banks and financial institutions (FIs) must act urgently to modernise and compete with agile digital challengers. This eBook provides actionable strategies for banks and FIs to address the ROE challenge by leveraging open finance solutions, including Banking-as-a-Service (BaaS), digital banking, and the modernisation of incumbent infrastructure to unlock new revenue streams and drive innovation. Key Highlights:

  • ROE Insights: Understand global and regional trends driving profitability challenges.
  • Strategic Growth Solutions: Leverage BaaS and digital banking to enhance customer experiences and grow ecosystems.
  • Modernisation Pathways: Explore incremental, low-risk approaches like dual-mode evolution to transform infrastructure without costly rip-and-replace models.
  • Real-World Results: Learn from case studies like Standard Chartered’s partnership with all-commerce platform Bukalapak in Indonesia, showcasing how ecosystem partnerships deliver measurable success.
Designed for leaders in incumbent banks and FIs, this eBook, c0-authored by audax, Synpulse and AWS, offers a roadmap to thrive in a digital-first, customer-centric future.

Unpacking the whitepaper

  • The ROE challenge: Understanding the global banking landscape
  • Tackling the ROE challenge: Strategic solutions
  • Dual-mode evolution: Incrementally unlocking benefits
  • Weighing the costs: Rip-and-replace vs dual-mode approach
  • Our solution: Synpulse and audax

Download our whitepaper

Ready to explore the various strategies to tackle declining banking ROE? Fill out the form below to download your copy of the whitepaper.

Whitepaper – Synpulse, AWS

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Transforming Banking: The Power Partnership of Jeel and audax Financial Technology

Posted on by Wenting Chen
Press Release

Transforming Banking: The Power Partnership of Jeel and audax Financial Technology

audax

6 November, 2024

  • Leveraging Jeel’s technology innovation with audax’s proven expertise to modernise banking, the parties are intending to modernise banking across Saudi Arabia as a first use case.
  • Enabling rapid migration from legacy systems and flexible business models including Banking-as-a-Service (BaaS), digital banks, super apps, and open banking solutions.
  • Facilitating ecosystem-wide integration to create new monetisation opportunities through real-time data access and seamless third-party partnerships.

RIYADH, 6 November 2024 – Jeel, the digital innovation arm of Riyad Bank, and audax Financial Technology (“audax”), a comprehensive digital banking technology solutions provider backed by Standard Chartered, have entered into a strategic partnership aimed at revolutionising the digital banking landscape in Saudi Arabia. The partnership brings together Jeel’s forward-thinking digital technology as an enabler of digital innovation, and audax’s proven track record as a solutions provider as the comprehensive plug-and-play banking solution powering Asia’s first Banking-as-a-Service (BaaS) offering by a global bank. This partnership offers a suite of comprehensive solutions for banks, financial institutions and non-bank entities in Saudi Arabia, with an initial focus on enabling advanced business models such as digital banks, BaaS, super apps, and open banking solutions.

Saudi Arabia’s financial sector is undergoing rapid transformation as part of Vision 2030, with a growing market for digital banking solutions driven by a tech-savvy population. The urgency of digital transformation is clear – banks must modernise to remain competitive in a fast-evolving economy, projected to reach $1.1 trillion in GDP by the end of 2024. The surge in digital wallets, from 315,000 users in 2018 to over 17 million by 2022, along with the rapid rise of real-time payments, emphasises the immediate demand for innovative, scalable banking models.

With initiatives like the SAR 300 million fintech-focused fund and the National Technology Development Program (NTDP) providing crucial funding and support for start-ups, the urgency of digital transformation in banking is increasingly clear. These measures highlight the opportunity for banks to modernise and capitalise on the significant potential created by Vision 2030, positioning them to compete and thrive in a rapidly evolving financial landscape.

While banks serve as the first application, these offerings are adaptable for other financial institutions and non-bank entities, allowing for seamless integration into a variety of ecosystems and extending the benefits of digital transformation beyond traditional banking.

In the shorter term, institutions in Saudi Arabia will benefit from rapid migration from legacy systems, unlocking new digital capabilities and flexible business models. Through easy integration with third-party vendors and ecosystem players, clients will be able to offer innovative services such as open banking solutions and BaaS use cases such as Cards-as-a-Service and Wallets-as-a-Service. This flexibility positions them to compete with digital-native challengers, drive customer acquisition, and improve operational efficiency.

In the longer term, the partnership between Jeel and audax will allow Saudi Arabia’s institutions to leverage a wealth of data across their ecosystems, creating new revenue streams and business lines. This includes opportunities such as real-time underwriting through third-party data access, cross-selling products through contextual offers, and even expanding into fee-based services such as KYC-as-a-Service and real-time data provision to consumer and SME-focused companies.

George Harrak, CEO of Jeel, added: “At Jeel, we are committed to driving innovation and technological digital advancement. Our collaboration with audax enables us to deliver pioneering digital solutions that will enhance the agility and scalability across Saudi Arabia and the region. By integrating our cutting-edge technology with audax’s proven platform, we can accelerate the digital transformation of our customers, including banks, financial institutions and non-bank entities, and provide them with the tools they need to thrive in an increasingly competitive market.”

Kelvin Tan, CEO of audax Financial Technology, commented: “We are excited to bring our proven digital transformation capabilities to Saudi Arabia through this partnership. By working with Jeel, we aim to accelerate the pace at which Saudi institutions can modernise and scale their digital offerings, ensuring they remain competitive in the evolving business landscape. Our partnership will empower them to launch cutting-edge solutions quickly and efficiently, creating new revenue streams and improving operational resilience.”

About Jeel

As the digital innovation arm of Riyad Bank, Jeel is dedicated to pioneering technological advancements and delivering cutting-edge solutions that shape the future of technology. With a focus on enhancing the digital experience for its customers, Jeel is at the forefront of innovation in the financial industry.

For more information, please visit www.jeel.net and follow Jeel on LinkedIn.

About audax Financial Technology

audax Financial Technology is a comprehensive digital banking solutions provider empowering banks and financial institutions to scale and modernise at speed. audax Financial Technology has enabled new business models and revenue streams for Standard Chartered under the SC nexus proposition, becoming the first global bank to provide Banking-as-a-Service in Asia.

For more information, please visit www.audax.io and follow audax on LinkedIn.

audax Financial Technology and Synpulse establish Strategic Partnership to Redefine Banking with Innovative, Contextual Solutions for Banks and Financial Institutions

Posted on by Wenting Chen
Press Release

audax Financial Technology and Synpulse establish Strategic Partnership to Redefine Banking with Innovative, Contextual Solutions for Banks and Financial Institutions

audax

25 September, 2024

  • Modernisation of existing infrastructure: Integrating dual-mode evolution with cloud migration services, institutions can seamlessly upgrade their digital banking systems alongside existing infrastructure and transition to scalable, secure cloud platforms, enabling them to serve millions of customers concurrently.
  • Embedded finance with contextual banking solutions: Enabling banks and financial institutions to enhance their customer offerings by integrating financial services into partner ecosystems via Banking-as-a-Service (BaaS), targeting both underbanked populations and digitally savvy customers in mature markets.
  • Streamlined implementation through combined expertise: Combining audax’s advanced digital banking technology with Synpulse’s integration expertise, banks can efficiently modernize, ensuring smooth system integration and rapid deployment of new technologies in as fast as six months.

SINGAPORE, 25 September 2024 – audax Financial Technology (“audax”), a comprehensive digital banking technology solutions provider backed by Standard Chartered, and Synpulse, a global professional services provider to major banking and insurance institutions, announced a strategic partnership to create tailored, customer-centric solutions for incumbent banks and financial institutions to modernise their existing infrastructure at speed.

 

This joint solution provides a dual-mode approach to banking infrastructure modernisation, designed to seamlessly coexist alongside the existing infrastructure of incumbent financial institutions. This eliminates the need for a complete overhaul, which can be a costly and time-consuming endeavour. For example, the joint solution by audax and Synpulse enables incumbent banks and financial institutions to transition their banking platforms to scalable, secure, and efficient cloud-based environments without disrupting their core operations. This modernisation of incumbent banking infrastructure empowers incumbents to serve millions of customers concurrently, enhancing their capacity to scale and adapt in a rapidly changing financial landscape.

 

While Europe enjoys high levels of financial access, with established institutions serving a largely banked population, the demand for embedded finance and contextual banking solutions is growing. Consumers expect seamless and integrated financial services, and with audax and Synpulse’s combined expertise, European banks can quickly meet these needs and tap into the rapidly expanding embedded finance market. In contrast, a substantial proportion of the population in Southeast Asia and the Middle East remains underbanked, with at least 70% in Southeast Asia and 60% in the Middle East lacking adequate banking services. audax and Synpulse enable these banks to rapidly launch BaaS propositions and provide essential banking solutions to the underserved communities. This breakdown of traditional silos creates new opportunities for banks, financial institutions, and their ecosystem partners to better meet the evolving needs of modern, digital-first customers across Southeast Asia, the Middle East, Europe and beyond.

 

Through the partnership between audax and Synpulse, banks and financial institutions can also look forward to:

    1. The ability to build a Banking-as-a-Service (BaaS) proposition and integrate financial services directly into diverse digital ecosystems in as fast as six months.

    2. Providing contextual financial services by leveraging a BaaS model, which enables a deeper understanding of customer data through ecosystem partnerships.

    3. Seamless implementation through joint expertise, ensuring efficient modernisation with smooth integration with existing systems and accelerated deployment of new technologies, allowing banks and financial institutions to serve millions of customers concurrently.

 

“We are excited to combine audax’s expertise with Synpulse and bring to life this flexible, cloud-centric solution to infrastructure modernisation. Together, we look forward to enabling banks to future-proof their technology stack,” said Mike Breen, Chief Commercial Officer at audax. “By leveraging our combined strengths, we’re setting a new standard for agile, resilient banking infrastructure that paves the way for greater financial inclusion and service innovation. Our joint solution is set to play a crucial role in democratising access to financial services and fostering economic growth across the Southeast Asia and Middle East regions, while supporting European institutions in meeting the growing demand for embedded finance and modernisation of incumbent technology.”

 

Andreas Neidhart-Lau, Head of Retail & SME Banking APAC at Synpulse, added, “Our collaboration with audax marks a significant milestone in our commitment to helping financial institutions thrive in a rapidly changing landscape. This partnership is about more than upgrading systems; we’re accelerating the pace of innovation, creating operational efficiencies, and fostering more inclusive financial ecosystems.”

 

audax Financial Technology

 

audax Financial Technology is a comprehensive digital banking solutions provider empowering banks and financial institutions to scale and modernise at speed. audax has enabled new business models and revenue streams for Standard Chartered under the SC nexus proposition, becoming the first global bank to provide Banking-as-a-Service in Asia.

 

For more information, please visit www.audax.io and follow audax on LinkedIn.

 

Synpulse

 

Synpulse is a global professional services company and a valued partner of leading players in the financial services and related industries. We optimise the proximity to our clients and deep domain expertise to create sustainable value using technology as a business driver. Leveraging our strong network of over 100 ecosystem partners, we accompany our clients throughout their transformation journey – from strategy and development to implementation and management. With our tech powerhouse, Synpulse8, we collaborate with our clients to co-create digital experiences with innovative technologies and proprietary methods. Synpulse is powered by the passion and commitment of its more than 1200 employees, who come from over 30 countries.

 

Further information www.synpulse.com.

Harmonising Progress: How audax’s Tech Bridges the Future with Legacy Banking Infrastructure

Posted on by Min Thu Ye
Blog

Harmonising Progress: How audax’s Tech Bridges the Future with Legacy Banking Infrastructure

audax

23 May, 2024

In the fast-evolving landscape of banking technology, the pressure on banks and financial institutions to modernise without disrupting their core operations has never been more intense. The challenge of digital transformation is not just about adopting new technologies but doing so in a way that complements and enhances existing systems.
blog-article-image

The Complexity of Change

According to McKinsey[1], over half of digital banking transformations surpass their planned timelines and budgets, or even fail. This shortfall is largely due to underestimating the complexities involved, such as intricate interfaces, data management, and the need for coordination across different initiatives. Leadership might not fully engage all stakeholders or accurately assess the necessary changes to business processes and the depth of integration required with existing IT architectures, making the role of complementary technologies even more vital.

 

This is where audax comes into play, offering a solution that marries innovation with tradition, ensuring that banks can step into the future with minimal headaches.

 

The Approach: Dual-mode Evolution

Our tech stack at audax allows banks to adopt a dual-mode evolution, where we progressively construct a new digital core with novel products and channels while optimising the legacy core’s value.

 

For example, this can enable the bank’s legacy core to continue handling deposits efficiently while introducing a new product engine for loan processing. The result is a harmonious blend of old and new, ensuring that banks can offer enhanced services without the risk of data duplication or system incompatibility.

 

This also ensures that client details are aligned and consolidated within the core banking system, preventing any duplication of client information by the product engine. Moreover, all relevant reports are designed to integrate seamlessly with the core banking system and other financial and regulatory reporting platforms.

 

Advantages of our dual-mode evolution include rapid time to market (i.e. 6 – 9 months), reduced complexity and risks, and the ability to reuse proven components, ensuring a seamless transformation to a digital powerhouse.

 

While the transition can present challenges, such as the potential knowledge gap within legacy teams concerning new technologies, we advocate for comprehensive training programs and phased integration plans that will ease the adoption process.

 

Our Success Story: Standard Chartered Bank

Standard Chartered Indonesia’s collaboration with Bukalapak to implement Banking-as-a-Service (BaaS) is a testament to the success of dual-mode evolution. This approach enabled the audax’s plug-and-play tech stack to sit next to Standard Chartered’s existing banking infrastructure, facilitating the launch of digital banking service BukaTabungan. It boasts rapid, paperless onboarding, achievable in as quick as 2 minutes, and was able to (i) 3X Standard Chartered’s customer base in Indonesia within 6 months (ii) attract 98 percent new to bank customers (expanding into new customer segments) (iii) attain 85 percent application approval rate; of which (iv) 97 percent of account openings are done in real time; (v) implement fast onboarding processes, thus reducing onboarding costs.

 

audax facilitates this via:

– Seamless Integration with Existing Banking Core: audax’s technology is designed to work alongside Standard Chartered’s existing core banking systems, ensuring that both the new and traditional banking operations are unified under the same reporting structure, party master, general ledger (GL) and more. This integration means that all customer and transaction data is consistently and accurately reported, providing a comprehensive view of the bank’s operations.

– Unified Data Management: By integrating with the existing banking core, audax enables a seamless deduplication process for existing-to-bank (ETB) customers. This means that customer data from both the new BaaS platform and the existing core banking system is consolidated and managed under a single system of record. This reduces the risk of duplicate records, ensuring that customer information is accurate and up-to-date.

– Enhanced Customer Experience: The integration of audax’s tech stack with Standard Chartered’s infrastructure allows for a smoother, more efficient customer onboarding experience. The paperless, rapid onboarding process is fully digital and takes as fast as 2 minutes, reducing the time and effort required for new customers to start using the bank’s services, enhancing customer satisfaction and engagement.

– Operational Efficiency: The dual-mode approach helps Standard Chartered maintain high operational efficiency by leveraging the strengths of both traditional and modern banking systems. audax’s technology supports real-time processing and high approval rates, which contribute to lower operational costs and higher approval rates.

– Scalability and Flexibility: The plug-and-play nature of audax’s cloud-native tech stack provides Standard Chartered with the flexibility to scale their BaaS offerings quickly and efficiently, with the ability to support millions of customers. As the market evolves, the bank can adapt and expand its services without overhauling its existing infrastructure.

 

This seamless fusion of innovation and tradition underscores the potential for banks to expand and modernise their services in today’s digital age.

 

The urgency for banks to transform their legacy systems cannot be overstated. As detailed in the collaborative whitepaper between Deloitte and nCino, “To Buy or To Build”[2], the banking industry is at a pivotal moment. Banks face a critical decision: to build their digital transformation solutions in-house or to buy and implement existing technologies. It continues to highlight the importance of leveraging digital technology for competitive advantage, emphasising the need for financial institutions to embrace change to improve customer experience and operational effectiveness.

 

At audax, we are a comprehensive digital banking solutions provider empowering banks and financial institutions to scale and modernise at speed. We stand out from other technology providers due to our roots in Standard Chartered nexus, as the underlying full tech stack that enabled Standard Chartered to become the first global bank to provide Banking-as-a-Service (BaaS) in Asia. With a promise of rapid deployment, audax distinguishes itself by offering a speed-to-market advantage, launching within 6-9 months.

 

As the banking industry continues to navigate the complexities of digital transformation, audax stands ready to bridge the gap between legacy systems and the future of banking. By embracing a dual-mode evolution that integrates rather than replaces, banks can achieve a competitive edge in a rapidly evolving digital world.

 

[1] Why most digital banking transformations fail – and how to flip the odds (McKinsey, 2023)

[2] To Buy or To Build (Deloitte & nCino, 2022)

audax Financial Technology and Paymentology forge Strategic Partnership to provide an end to end Cards-as-a-Service solution

Posted on by Min Thu Ye
Press Release

audax Financial Technology and Paymentology forge Strategic Partnership to provide an end to end Cards-as-a-Service solution

audax

15 May, 2024

  • Faster Time to Market: The partnership between audax and Paymentology allows financial institutions (FIs) to launch card programs quickly and efficiently, eliminating the need for complex infrastructure development.
  • Cost Savings: By leveraging the Cards-as-a-Service (CaaS) proposition, banks can significantly reduce costs associated with traditional methods, enhancing their bottom line while offering innovative payment solutions that improve the overall customer experience within own channels and in collaboration with co-brands.
  • Increase Customer Engagement and Brand Loyalty: Banks and aspiring FIs can now introduce customised card programs swiftly to enhance customer engagement and deepen brand loyalty through real time data insights.
audax-paymentology-banner

SINGAPORE, 14 May 2024 – Paymentology, the leading next-gen global issuer-processor, today announced a strategic partnership with audax Financial Technology, (“audax”), a comprehensive digital banking technology solutions provider backed by Standard Chartered Ventures. This collaboration transforms the payments landscape in Southeast Asia and the Middle East and allows financial institutions (FIs) to seamlessly launch and manage their own branded card program in a matter of months.

 

With CaaS, banks and FIs can deliver frictionless payment experiences without the complexities associated with traditional methods, including time-consuming technical integrations into incumbent systems such as core banking, and dramatically reduce the total cost of ownership. By leveraging audax’s all-encompassing digital banking and Banking-as-a-Service (BaaS) solutions alongside Paymentology’s advanced card processing capabilities, this partnership addresses a market gap and niche for CaaS in these regions, presenting a scalable and quick-to-market model that simplifies the initiation and management of the card-issuing process.

 

Paymentology leads the payments industry with its superior multi-cloud platform that supports shared and dedicated processing instances for all card types. Paired with audax’s digital banking technology solutions, the combined offering empowers banks and FIs to swiftly scale and modernise their existing infrastructure. This enables them to efficiently manage large volumes of customer data concurrently, deploy innovative card programs, streamline operations, reduce time-to-market, and ultimately enhance the customer experience.

 

The news comes as banks across the board face significant challenges amid economic uncertainty, with earnings reports highlighting the developing trend of slowing revenue growth and decelerating margin expansion. Despite similar regulatory and tax structures to larger banks, many institutions, including community and regional banks, often operate with lower reserves and less stable funding bases, rendering them more susceptible to financial volatility.

 

To fortify their revenue stream, banks and FIs must explore innovative ways to serve their existing customer base and attract new clients. audax and Paymentology’s joint solution aims to help banks and FIs streamline and scale the operations of card programs without the challenges associated with navigating complicated regulatory frameworks.

 

Merusha Naidu, Global Head of Partnerships at Paymentology commented on the partnership: “We’re thrilled to announce our partnership with audax. Through this collaboration, we will empower banks to thrive in the digital age by utilising audax’s digital banking platform in combination with our cloud-native next-generation platform. We aim to modernise the infrastructure of financial services institutions by accelerating the deployment of card programmes for issuers and co-brands, empowering them to run programmes based on customer and market needs efficiently.”

 

Michael Breen, Head of Commercial at audax added: “Our partnership announcement is timely as we continue to grow our presence in Southeast Asia and the Middle East. Together, we enable banks to increase their customer base, balance sheet and launch compelling, relevant products at speed, meeting customer needs. By leveraging audax and Paymentology’s combined expertise, banks can navigate economic uncertainty and bolster their bottom lines by offering innovative payment solutions.”

 

About Paymentology

Paymentology is the leading next-gen global issuer-processor. It gives banks, fintechs and telcos the technology, team, and experience to easily issue and process any type of physical or virtual card; debit, prepaid, credit, BNPL, revolving and more. Anywhere in the world, rapidly and at scale.

Paymentology’s superior multi-cloud Platform offering both shared and dedicated processing instances, vast global presence and richer real-time data, set it apart as the leader in payments. Their payments experts bring deep, local market knowledge on the ground in 60 countries, across 14 time zones, guaranteeing 24/7 support. Paymentology is deeply committed to increasing financial inclusion worldwide, and to making a positive impact in the communities in which it operates.

For more information, visit https://www.Paymentology.com/.

 

About audax Financial Technology

audax Financial Technology is a comprehensive digital banking solutions provider empowering banks and financial institutions to scale and modernise at speed. audax Financial Technology has enabled new business models and revenue streams for Standard Chartered under the SC nexus proposition, becoming the first global bank to provide Banking-as-a-Service in Asia.

For more information, please visit www.audax.io and follow audax on LinkedIn.

 

Bridging Horizons

Posted on by Min Thu Ye

Whitepaper

Bridging Horizons

Navigating BaaS adoption, risks and governance for banks and financial institutions

The Strategic Imperative of BaaS

Banking-as-a-Service (BaaS) is poised to revolutionise the financial sector, projected to grow from $11 billion in 2022 to over $38 billion by 2027. This whitepaper explores how BaaS enables banks and financial institutions (FIs) to expand their customer base and introduce innovative financial products at lower costs, improving returns on equity and opening new revenue streams.

Despite its promising future, BaaS adoption faces significant challenges, including regulatory compliance and operational readiness. Strategic partnerships with fintech companies are crucial for banks and FIs looking to overcome these obstacles and accelerate their market entry. From this whitepaper, you will gain actionable insights into navigating the complexities of BaaS, benefiting from proven strategies and case studies to successfully implement and leverage BaaS in your own organisation.

Unpacking the whitepaper

  • BaaS adoption: What BaaS means for financial institutions?
  • Risk and governance considerations for financial institutions
  • Unlocking the potential of BaaS

Download our whitepaper

Unsure what is required to navigate the internal and external risks of BaaS? Fill out the form below to download your copy of the whitepaper. Discover comprehensive insights, detailed case studies, and actionable strategies to position your financial institution at the forefront of the BaaS revolution.

Access your essential guide to mastering BaaS now!
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The future of payments in Singapore: From outages to innovation with BaaS

Posted on by Sue-Anne Ho
Blog

The future of payments in Singapore: From outages to innovation with BaaS

audax

12 April, 2024

The BaaS model will enhance the payments landscape by reducing technical debt, boosting agility, and scaling without compromising legacy systems.

In today’s world, seamless payment transactions for daily essentials like food, transportation, and housing are expected. Yet, some of the most commonly used payment systems appear disconnected,, clunky, rife with technical issues and fraud – rampant in everyday life. In October 2023 alone, 2.5 million transactions were affected by bank outages in Singapore and 810,000 attempts to log in to digital banking accounts failed.

 

Despite having advanced technology solutions readily available, notable challenges still exist in the financial industry. With customer wants and needs rapidly evolving with technology, how can traditional financial institutions keep up?

 

Embedded finance is the norm today and Banking-as-a-Service (BaaS) is the antidote to the issues plaguing payments and the broader financial industry. Enabling banks and fintech companies to innovate as they collaborate, which then leads to better and more efficient financial products and services, BaaS simplifies the integration of banking services via the use of APIs, reducing complexity and speeding up the development of new payment solutions. The benefits are both obvious and endless, but we must first understand why it is especially crucial in Singapore’s payments market.

 

The payment landscape in Singapore can be divided into three categories of key players: banks and financial institutions, payment processors (think Visa or Mastercard, Stripe, Apple Pay, etc.), and fintech firms looking to disrupt the financial services landscape. It features multiple digital payment systems, schemes, and providers that operate independently, leading to complexities for both merchants and end consumers.

 

PayLah!, PayAnyone, and PayNow have transformed the ability to make purchases, including P2P purchases, without the need for a payment gateway or terminal. Now, everyone with a bank account can be both a merchant and a consumer, reducing the cash transactions seen from yesteryear. User acceptance across these applications is promising.

 

There is also a huge range of payment providers with their own set of services, fees, and technical requirements that are complex to navigate. Additionally, the existing services can be inefficient, partly due to the significant technical debt accumulated by banks and financial institutions over the years as new features are added and changes are made to accommodate the evolving requirements of users. Technical debt and the lack of resources utilised to play catch up sees legacy systems succumb to outages and inefficiencies.

 

The BaaS proposition was specifically designed to overcome these challenges. BaaS typically means that banks and financial institutions leverage scalable and modular technology solutions that allow them to expose their services to third party platforms in a seamless manner. On top of that, banks and financial institutions effectively providing BaaS already adhere to industry standards and best practices, especially around security and regulatory requirements that also prevent the introduction of unnecessary complexity or inefficiencies into the system.

 

BaaS is a one-way ticket to a world where banks work with third party platforms including but not limited to fintechs, to launch new products and services without having to build infrastructure from scratch. This is where innovation happens at speed as we can test new ideas and iterate more rapidly.

 

On a more practical level, BaaS also enhances security in the financial services industry, as the banks and financial institutions themselves are adopting advanced security measures, compliance with regulatory standards, secure APIs and data protection measures as part of their technology stack.

 

However, there is still quite a ways to go in terms of the widespread adoption of BaaS as a business model amongst banks and FIs in Singapore. Many banks and financial institutions are yet to fully appreciate the suite of advantages that the business models offers, whilst others are hesitant to do so due to the limitations of their existing solution in catering to the inevitable scale of a BaaS business model.

 

Addressing these challenges will need a multifaceted approach with regulators, third party ecosystems, payment providers and banks / financial institutions collaborating to create an environment conducive to innovation with ample support for the integration of a easy to deploy and scalable solution with legacy systems.

 

Singapore’s readiness to be a global leader in fintech is proof of its rapid growth potential. With the government implementing and promoting regulatory sandboxes that allow for fintechs to test products and services in a controlled environment, a revolving door of new fintech solutions to solve even the most complex problems awaits. We’ll also start to see a higher rate of financial inclusion as the use of digital wallets and simplified banking services are more widely adopted.

 

Overall, the Singapore payments landscape will benefit greatly from an adoption of a BaaS business model by banks and financial institutions – especially in reducing technical debt, significantly increasing agility and offer a solution to scalability without compromising in legacy systems. With the government’s commitment to continuous improvements and fixes, the transformative impact of BaaS on the Singapore payments landscape is poised to be significant, paving the way for a more efficient, secure, and innovative financial ecosystem.

 

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This article was first posted on e27.

audax Financial Technology and Thought Machine announce strategic partnership to create customised end-to-end digital banking solutions, at faster speeds and lower costs

Posted on by Min Thu Ye
Press Release

audax Financial Technology and Thought Machine announce strategic partnership to create customised end-to-end digital banking solutions, at faster speeds and lower costs

audax

28 February, 2024

  • Holistic integration for modern customer needs: Delivering pre-integrated digital banking technology and Banking-as-a-Service (BaaS) solutions.
  • Flexibility and scalability: Integrating audax’s scalable digital banking technology platform with Thought Machine’s highly configurable core banking technology, enabling institutions to swiftly modernise infrastructure and develop fully customisable financial products for end customers.
  • Seamless coexistence with legacy systems: Facilitating the swift establishment of digital banking or BaaS within months.
audax logo and Thought Machine logo

SINGAPORE, 28 February 2024 – audax Financial Technology (“audax”), a comprehensive digital banking technology solutions provider backed by Standard Chartered, and Thought Machine, a global leader in next-generation core banking technology, have announced a strategic partnership to transform and modernise the banking technology landscape.

 

Digital banking is projected to reach a USD13 trillion opportunity for banks by 2032[1]. With the launch of this partnership, audax and Thought Machine are positioned as key players in this expanding market. The partnership is centred on delivering innovative digital banking and BaaS solutions that meet consumers’ needs, at scale with faster speeds and lower costs.

 

The collaboration between audax and Thought Machine combines audax’s scalable digital banking platform that enables seamless API-based integration with partners and banks, with Thought Machine’s highly configurable cloud-native core banking platform, Vault Core, which enables financial institutions to offer fully customisable financial products for their end customers. This integrated solution significantly reduces the need for multiple vendors, streamlining the entire process.

 

The flexibility and scalability of the combined technologies allows incumbent banks and financial institutions to swiftly modernise their infrastructure and create new revenue streams by opening new business models that offer various financial products at scale.

 

audax and Thought Machine’s joint solution can also seamlessly integrate with a bank’s current infrastructure, enabling financial institutions to rapidly establish a new digital bank or offer BaaS at speed. The partnership, combined with ready components and extensive customer journeys, facilitates seamless plug-and-play experiences and eliminates the complexities of development and legacy system integration for swift market entry.

 

“audax understands that the future of financial services hinges on the strategic collaboration between technology solution providers to empower incumbent banks and financial institutions as they begin their journey to adapt to a rapidly evolving financial services landscape,” said Kelvin Tan, CEO of audax. “This joint solution provides customers with the ability to obtain hyper-customised offerings, and we look forward to delivering these robust end-to-end digital banking solutions that address the diverse needs and use cases and needs of various financial institutions.”

 

Randy McFarlane, global head of partnerships, Thought Machine, added, “Our collaboration with audax reduces the challenges of building a modern technology stack, providing a seamless, efficient, and scalable digital banking experience. By integrating both innovative technologies we are empowering banks and financial institutions to navigate the complexities of modern banking with confidence.”

 

audax Financial Technology

audax Financial Technology is a comprehensive digital banking technology solutions provider empowering banks and financial institutions to scale and modernise at speed. audax Financial Technology has enabled new business models and revenue streams for Standard Chartered under the SC nexus proposition, becoming the first global bank to provide Banking-as-a-Service in Asia.

For more information, please visit www.audax.io and follow audax on LinkedIn.

 

Thought Machine

Thought Machine has developed the foundations of modern banking with its cloud-native core banking and payments technology. Its cloud-native core banking platform, Vault Core, is trusted by leading banks and financial institutions worldwide, including Intesa Sanpaolo, ING Bank Slaski, Lloyds Banking Group, Standard Chartered, SEB, Lunar, Atom bank, Curve, and more.

Vault Core and Vault Payments have been written from scratch as entirely cloud-native technologies, giving banks full control to run any bank, product, and payment set to flourish in a rapidly changing world.

Thought Machine is a global team spread across offices in London, New York, Singapore, and Sydney and has raised more than $500m in funding.

For more information, visit thoughtmachine.net.

 

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[1] Digital Banking Market Size by Service (Global Market Insights, 2022)

Obsolete to Absolute, with Banking-as-a-Service

Posted on by Min Thu Ye

Whitepaper

Obsolete to Absolute

Discover Banking-as-a-Service (BaaS): From obsolete practices to absolute potential in tomorrow’s financial landscape

A $25 billion opportunity!

Banking-as-a-Service (BaaS) is revolutionising the financial services sector, reshaping how banks deliver financial products and services to consumers and businesses.

This whitepaper is specifically designed for incumbent banks considering BaaS. With BaaS as a business model, banks can partner non-bank entities and integrate banking capabilities, enabling these non-bank entities to offer financial services to their customers without the need to obtain a banking license or build their own banking infrastructure. This presents significant market opportunities to the entire ecosystem.

By 2026, Forbes reports that Embedded Finance is projected to reach USD7 trillion in transaction value and BaaS could evolve into a USD$25 billion opportunity for banks, underscoring its pivotal role in the ever-evolving financial landscape. This paper examines the key drivers fuelling the growth of BaaS, its impact and transformative potential on banks and non-bank entities, and its profound implications for consumers. Case studies will also illustrate the various BaaS implementations and offer valuable insights for banks interested in pursuing a BaaS strategy.

Banks looking to provide BaaS as a value proposition will find audax’s and Thought Machine’s solutions well-positioned to seize this unique opportunity and succeed in the new era of financial services.

Unpacking the whitepaper

  • What are the various digital banking models?
  • What is BaaS, Open Banking and Embedded Finance?
  • What do financial institutions stand to gain with BaaS?
  • What should you consider when selecting a BaaS provider?
  • How can you harness the benefits of BaaS with Thought Machine and audax?

Download our whitepaper

Ready to dive deep into the transformative world of BaaS?

Complete the form below to download the full whitepaper. Gain unparalleled insights, case studies, and strategies that will empower your bank to lead in the evolving financial landscape. Don’t miss out on harnessing the potential of BaaS for your institution. Get your exclusive whitepaper today.
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Embedded Finance: The Reality Check for Banks

Posted on by Min Thu Ye
Blog

Embedded Finance: The Reality Check for Banks

audax

26 October, 2023

Change. Every sector faces it, but in the financial world, the ace is relentless. As if staying ahead wasn’t challenging enough, the era of digital banking transformation for traditional banks is dawning, and it heralds the age of Embedded Finance. For Chief Technological Officers (CTOs) & Chief Investment Officers (CIOs), this isn’t just another buzzword – it’s a seismic shift with its own set of headaches.
Quote by Kelvin Tan

Kelvin Tan, CEO & Chief Dreamer of audax Financial Technology (previously Managing Director & Global Head of Standard Chartered nexus), hits the nail on the head: “Embedded finance is already giving the more forward-looking banks access to new revenue streams and to previously unbanked customers. People need to understand exactly how big an opportunity it is and get a move on. The first five to scale in this will corner the market.”

 

But we get it; transitioning isn’t easy. So, let’s break it down.

 

The Evolution of the Embedded Finance Proposition: Embedded finance was initially about straightforward, transaction-based services. But now? It’s evolved into an opportunity for digital banking transformation for traditional banks. We’re talking about DeFi, Web 3.0, and the benefits of partnering with fintech companies for comprehensive banking solutions. It can be daunting, but the upside is a redefined relationship banking and a closing of historical service gaps.

 

Embedded Finance Distribution is Verticalising: As the world of Software-as-a-Service (SaaS) undergoes change, so must embedded finance. With specialised platforms becoming data goldmines, this could be where a cloud-native banking platform for fintechs and banks shines. Platforms are already predicting lending trends. For traditional banks wondering, “How can Banking-as-a-Service (BaaS) help traditional banks offer more innovative financial products?” – the answer lies in embracing this shift or risk obsolescence.

 

Banks are Getting More Active: Higher interest rates might seem like a good thing, but they’re a double-edged sword. While boosting margins for some, they’re giving fintechs a competitive edge. By being able to have all your digital banking capabilities in a single platform, Kelvin suggests that this is a “land-grab moment.” Fortune is on the side of the bold, no matter the size of the institution. So for banks feeling overwhelmed, we’re here, equipped with white-label digital banking solutions & next-gen tech tools for you.

 

The Importance of Regulation Cannot be Overlooked: Let’s face it, regulations can be a migraine in the making. From keeping pace with open banking changes to the growing pressure on embedded finance platforms to streamline consumer interactions, it’s a tightrope walk. And with the marriage of technology and regulation (hello, cybersecurity!), the challenges amplify. Here’s a thought: What if regulations were machine-readable? It’s not a distant dream but a necessary evolution.

 

Embedded finance isn’t the future – it’s the here and now. And while it’s filled with its share of hurdles, it’s also ripe with opportunity. At audax, we’re not just bystanders; we’re in the trenches with you. Let’s navigate this evolving landscape together, empowering you to scale and modernise at speed with our digital banking capabilities, so that you can focus on your business.

 

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If you’re navigating the tumultuous waters of embedded finance now, we’ve got your back. Curious about what audax the only live full stack digital banking platform that has delivered BaaS in Asia, brings to the table? Take a tour here.

 

Or prefer a genuine chat about the challenges? We’re always up for a conversation, especially if it means helping you out. You can connect with us by filling up the “Get in touch” form & a member of our team will be in touch with you soon.

 

Before we conclude, a big shout-out to the team at aperture. They’ve done some fantastic legwork in chatting with the brightest minds in the finance world, distilling their wisdom into the indispensable report that we have taken reference from, “Embedded Finance Predictions: insights into a fast-evolving market.” Keen on diving deeper? Download the full report here.