Since digital payments are becoming increasingly popular, users are perhaps more vulnerable to cybersecurity attacks than ever before. The answer to this increased risk? A self-sovereign identity (SSI)—especially for the financial services sector.

What is Digital Identity? Why is it important?

First, we need to understand what a digital identity is.

A digital identity is simply a collection of electronically stored features associated with a uniquely identifiable individual. Examples can include usernames and passwords, date of birth, and electronic transactions.

Typically, we establish multiple digital identities, including creating new accounts for each service provider we enroll with, or through third-party login mechanisms like Facebook (although these are generally considered insecure for financial services).

Summarily, we establish a new account for each new sensitive service we sign up for. Consider two problems:

1. We create several identities with multiple providers, all different but each representing the same person—all of which are vulnerable to identity theft with no easy or standard way to verify them.
2. We have no way of knowing when our identity is used, by whom, or when/if to revoke consent to the usage of that particular identity.

A self-sovereign identity (SSI) can help solve these problems. An SSI is a lifetime portable identity for any person, organization, or thing that does not depend on any centralized authority and can never be taken away.

The shift towards virtual: principal drivers toward a more secure digital identity

Over the duration of the pandemic, it became clear that digital identity became of paramount importance as an answer to ever-present security issues, and amplified them – especially for the financial services sector.

Concerns at the forefront of this industry participants include:

• What current challenges are digital identity frameworks facing, and what might be on the horizon?
• Why has the need for a new digital identity model emerged, and how might a solution to it take form?

Many companies were unprepared for the necessary changes in procedures and infrastructure associated with the wide acceptance of remote work.

Network providers were challenged by an unprecedented rising demand of traffic, and many service providers had difficulty anticipating and enabling the corresponding client increase.

Impacts of the pandemic on the consumer side were also immediate, including both quantifiable and behavioral elements. Already an established trend, the virtual consumption model has only accelerated in momentum, based on convenience, health perception/protection, and regulatory mandates. Fortunately, other businesses, with a less physical transaction model, were able to pivot and capitalize through an expanded e-commerce presence as a survival tactic.

Corresponding to these behaviors was the shift away from physical payments and cash, driven by these same tactical and strategic factors. Consider tangible and observational elements that included:

• Significantly smaller proportion of payments being made in-person as isolation kept people at home.
• Customers are being advised to avoid cash for hygienic reasons and many businesses now discourage cash—or are reluctant to accept it.
• Contactless cards and digital wallets seeing a spike in usage—reinforced by the preferred usage habits of newer generations. In the UK, for example, cash usage decreased by 50%.

Initiatives underway in some countries encourage the wider acceptance of a completely digital currency based on blockchain technology.

These observed phenomena are not only present in well-developed countries, but exist globally, including those with less established economies. In these countries, telcos witnessed the biggest increase in usage, given the reliance on systems like M-Pesa. Many people in these countries are migrating directly from cash to mobile payments without ever owning a physical payment card.

The rise of cybercrime and contributing factors

Virtual transactions can be the target of another global growing trend: digital fraud and identity theft.

While the impact on individuals might be exhibiting a decline over the last two years, it is still sizable. According to the Identity Theft Resource Center, 300,562,519 individuals were impacted by publicly reported data breaches in 2020.

Cyber criminals are less interested in theft of consumer personal information, with a notable uptick in activities targeting lucrative businesses through stolen credentials such as logins and passwords.

Ransomware and phishing attacks require less effort, are largely automated, and generate payouts that are much higher than taking over the accounts of individuals. One ransomware attack can generate as much revenue in minutes as hundreds of individual identity theft attempts over months or years. The Identity Theft Resource Center also reports that the average ransomware payout was greater than $233,000 per event in the fourth quarter of 2020.

Among the possible factors contributing to this rapid increase:

• Customer vulnerabilities are exposed as they are forced to new payment methods and asked to rely on and trust third parties.
• Confidence levels have been driven lower and social anxiety is higher, making individuals more susceptible to social engineering attacks as they turn to these channels.
• Increased competition has compelled banks into a cost-cutting situation, where mitigating these categories of attacks mandates an additional technical (and technology investment) challenge. This also implies that there will be an increase in long-term investment in fraud detection.
• As more and more services are moved online (in the form of e-commerce) and more businesses take advantage of embedded finance, a larger online perimeter is established in which malicious users can “play”—including offering more opportunities for attackers to build synthetic profiles from several data breaches, which are then utilized by applying illegally for a loan or for a credit card.

Regulatory impacts and their contribution towards the establishment of digital identity

Regulations across the financial services industry and in other sectors are pushing the innovation edge by necessity. While US-based entities are adhering to an enhanced regulatory framework, these mandates are particularly applicable in Europe, where there is necessary compliance with enacted standards (such as the General Data Protection Regulation—commonly known as GDPR—and the Payment Service Providers Directive 2—referred to as PSD2. A clear need for a true and persistent digital identity as a solution to the ancillary—and sometimes unforeseen—challenges that have arisen. While these challenges point to the need for secure digital identity, Yet, in practice, we have already exposed ourselves unknowingly.

In the physical world, we’ve adopted standard and verifiable practices for obtaining and maintaining permanent identity-related documentation, such as a passport or driver’s license. Either of these documents are accepted globally as identification medium and they are trusted as such.

Can’t we replicate a parallel solution in the digital world as well?

Introducing Self Sovereign Identity (SSI)

Self-sovereign identity (SSI) is a term used to describe the digital movement that recognizes an individual should own and control their identity without the intervening administrative authorities.

Let’s start with identifying some of the acronyms used:

• SSI: Self-Sovereign Identity
• DID: Decentralized Identifiers
• SSO: Self Sovereign OpenId Connect (not to be confused with Single Sign-On)

SSI is a “lifetime portable identity for any person, organization, or thing that does not depend on any centralized authority and can never be taken away.”

To understand our perspective as applied to these concepts, we’ll examine the three main models for identity management.

• Centralized Identity or “siloed” identity is the simplest of the three models. An organization issues the digital credential to individuals or allows them to create it for themselves. Trust between the individual and the issuer is typically established through the use of shared private information: usually in the form of a username and password and sometimes additional information such as a PIN or security questions. Occasionally this information is augmented with additional factors such as physical tokens or biometrics.
• Federated identity or IDP relationship model adds a third-party company or consortium, acting as an “identity provider” (IDP) between the individual and the issuer or service the individual is attempting to access. The IDP issues the digital credential, providing a single sign-on experience with the IDP that can seamlessly be used elsewhere—reducing the number of separate credentials a consumer needs to maintain.
  • A common example of the IDP model is “social login” on the web using Facebook, Google or other social IDs to access a third-party service. With social login, one of these tech giants serves as the IDP, but this option is acceptable only in lower-trust environments (such as e-commerce) and not in a high-trust one such as banking.
• Self-sovereign identity (SSI) is a two-party relationship model, with no third party coming between the individual and the issuer. SSI begins with a digital “wallet” that contains digital credentials. It acts like a physical wallet where a consumer carries credentials issued by others, such as a passport or driver’s license.

The four basic flows and elements involved in this model, consisting of:

1. Decentralized IDentifiers: you will likely have multiple DIDs according to which issuer you identify from. Each one will give you a lifetime encrypted private channel with another person, organization, or other entity. You will use it not just to prove your identity, but to exchange verifiable digital credentials and aid in its simplicity and security: there will be no central registration authority, as every DID is registered directly on a blockchain or distributed network.
2. Decentralized Key Management System: a proposed open standard for managing the private keys you need for DIDs, which includes robust, highly usable key recovery. DKMS key recovery supports both offline recovery (“paper wallet”) and social recovery (“trustee”) methods.
3. DID Auth: a simple standard way for a DID owner to authenticate by proving control of a private key.
4. Verifiable credentials: the format for interoperable, cryptographically-verifiable digital credentials being defined by the W3C Verifiable Claims Working Group.

Using SSI in the real world

Sean Brown, Program Director, IBM Security, presented a real-world use case at the 2020 Data Center World Conference. He examined how our fictional person, “Alice”, leveraging her newly acquired college degree, can swiftly apply to a new job at Acme Corporation, and subsequently apply for a loan, while continuously maintaining complete control and management over her identity.

Upon graduation, Alice is issued a transcript (DID Auth) which she can use to apply for employment. Alice stores these credentials in her digital wallet (DKMS) which resides in a distributed ledger.

1. Alice presents credentials from her wallet when she needs to prove her identity in a peer-to-peer interaction.
2. Acme Corp uses decentralized identifiers and verifiable credentials (DID) from the distributed ledger to perform identity verifications to greatly simplify processing, and upon successful employment, issues a job certificate.

The same flow happens where Alice applies for a loan, leveraging her newly acquired job verifiable credentials.

1. Alice presents a job certificate and other necessary information to her prospective bank.
2. The bank verifies the criteria for authenticity and accuracy via the distributed ledger and is able to issue an account certificate to Alice.

As these events transpire, Alice will accumulate several DIDs according to which Peer she is identifying with (in this example Acme or her Bank), and each Peer will release a new DID upon successful authentication and processing.

Most importantly, the distributed ledger component guarantees the greatly more efficient and unforgeable format of authentication verification.

One last relevant element is the fact that Alice will disclose only the elements of her DID that are relevant to that specific interaction (for example, she might decide not to share her GPA with the bank when applying for the loan) because she has full control over it.

Where to go with SSI

In each instance where identity verification is part of a more complex process, there can be a drastic reduction in processing duration and increased effectiveness.

Consumers will benefit in instances such as loan processing (with accompanying credit check verification) or when establishing a new bank account or a new internet contract (with identity and residency manual verification).

Service providers may benefit, as they will be able to minimize fraudulent account creation and simultaneously protect both parties from phishing attacks.

These advantages are not limited to business enterprises, as most services provided by public administration could be potentially moved online (assuming the procedure behind the web interface has been automated).

Additionally, these practices have the potential to open access to financial services for those presently not in possession of bank accounts (without the need to sign up for a full-fledged account). As an example, we refer to one of the first success cases of SSI to appear in the news: MyCash Money selects Onfido to power remittance services in Singapore and Malaysia with trusted identity verification.

Concluding remarks

Whether driven by new realities in consumer behavior that might become permanent, or taken in response to regulatory issues which hope to enhance security and limit fraudulent activity, the concept of robust digital identity has deservedly risen in importance.

The critical element and functionality of SSI revolve around Digital Identity Management, which typically is under the control of an identity platform—an example of which is Red Hat Single Sign-On.

To explore a case study example of how Red Hat’s Single Sign-On (SSO) technology utilized an access-based identity repository in conjunction with our OpenShift product to solve a complex customer problem, we’d invite you to explore here.

About the Author:
Luca Ferrari, Principal Solution Architect, Red Hat
Luca Ferrari is a Senior Specialist Solution Architect at Red Hat focusing on Adapting legacy support systems for the digital era.

CHARLOTTE, N.C. — This week, the Bank Automation Summit goes live for the first time since the start of the COVID-19 pandemic. What can attendees expect? The following are three key themes that will form the backdrop of nearly all the sessions planned for the event, which starts Tuesday, March 1, at 1 p.m. ET. […]

President Joe Biden’s administration on Monday banned U.S. people and companies from doing business with the Bank of Russia, the Russian National Wealth Fund and the Ministry of Finance.

The moves by the U.S. Treasury’s Office of Foreign Assets Control will “effectively immobilize” any Russian central bank assets held in the U.S. or by U.S. nationals, according to a Treasury department statement.

The U.S. also announced new penalties on a key Russian sovereign wealth fund, the Russian Direct Investment Fund, and its Chief Executive Officer, Kirill Aleksandrovich Dmitriev, a close ally of Russian President Vladimir Putin.

The announcements marked the latest blow in the West’s financial retaliation against Russia following Putin’s invasion of Ukraine and are designed to shake an already staggering Russian financial system.

“The unprecedented action we are taking today will significantly limit Russia’s ability to use assets to finance its destabilizing activities, and target the funds Putin and his inner circle depend on to enable his invasion of Ukraine,” Treasury Secretary Janet Yellen said in a statement.

The U.S. and EU blocks on the Russian central bank’s assets will immobilize nearly half of Putin’s warchest, according to a Treasury spokeswoman. Roughly 13% of the central bank’s reserves are held in China, she said.

Putin’s warchest is an estimated $630 billion in reserves, the officials said, and the measures are aimed at blocking his ability to sell those to mitigate financial pressure domestically.

Russia’s own data published in January shows that $100 billion of the reserves were held in U.S. dollars as of June.

The U.S. separately issued a license allowing certain energy transactions with the central bank, a carve-out a senior administration official said is aimed at minimizing the fallout in Europe and energy markets. It will take time for Russian institutions to figure out how to segregate energy transactions from other measures, the official said.

Finalizing banks cut off from SWIFT

The U.S. is continuing to work with European Union partners to finalize the list of banks that will be cut off from the SWIFT system, a second senior administration official said. The list of banks will be finalized by the EU because SWIFT is under Belgian authority.

U.S. officials are monitoring Belarus’s role in the Russian invasion, and that country will also face further consequences if it continues to aid and abet Russia, one of the officials said.

Read more: Russia Erects Financial Defenses to Shield Economy From Curbs

The moves came two days after the U.S., U.K., Canada and the EU said they would block major Russian banks from SWIFT, take steps to stop Russia’s central bank from rescuing the nation’s economy and move to seize Russian oligarchs’ yachts and residences in the West.

The U.K. Treasury said earlier Monday it will act immediately to stop people and companies doing businesses with the Bank of Russia, the Russian National Wealth Fund and the Ministry of Finance.

The moves to isolate Russia from the global economy came after an initial round of penalties failed to persuade Putin to withdraw his forces from Ukraine.

The Bank of Russia acted quickly to shield the nation’s $1.5 trillion economy from the sweeping penalties, more than doubling its key interest rate to 20%, the highest in almost two decades, and imposing some controls on the flow of capital.

Facing the risk of a bank run, a rapid sell-off in assets and the steepest depreciation in the ruble since 1998, policy makers banned brokers from selling securities held by foreigners starting Monday on the Moscow Exchange.

Even before the new sanctions have taken effect, the Russian financial system has buckled under their weight.

The ruble continued to plunge against the dollar, with the currency losing a third of its value in offshore markets at one point Monday, hitting an all-time low of 109 per dollar in Moscow.

The announcements came as a Ukrainian delegation led by the defense minister began talks with Russian officials. Ukrainian President Volodymyr Zelenskiy has voiced skepticism that the talks, taking place on the country’s border with Belarus, would yield results but said he was willing to try if it meant any chance of peace.

The European Union over the weekend closed its airspace to Russian aircraft and announced it would fund weapons purchases for the first time to aid Ukraine.

BP Plc on Sunday moved to dump its nearly 20% stake in the Russian oil giant Rosneft PJSC. By joining the worldwide effort to kneecap Russia’s economy, the British company could take a financial hit of as much as $25 billion. While the move came amid pressure from the U.K. government, it showed how far Western powers are willing to go in punishing the Kremlin.

Putin ordered Russia’s nuclear forces on high alert following the sanctions, which he called an act of Russian aggression. White House press secretary Jen Psaki said on ABC’s “This Week” the move was part of a pattern of Putin “manufacturing threats that don’t exist in order to justify further aggression.”

The United Nations Security Council called for a rare emergency session of the General Assembly to discuss Russia’s invasion of Ukraine. The session is set to be held Monday.

Avenir and Google partook in a Series A funding round led by Andreessen Horowitz for Carry1st, the African mobile games publisher. The round saw $20million raised and will go towards expanding its content portfolio; growing its product, engineering, and growth teams.

A number of prominent angel investors participated in the round, including Grammy winner and renowned crypto investor Nas, and founders of Chipper Cash, Sky Mavis, and Yield Guild Games. In addition, investors from Carry1st’s May 2021 Series A are backing the company again, namely Riot Games, Konvoy Ventures, Raine Ventures, and TTV Capital.

On the back of 96 per cent month revenue growth, Carry1st will also use the additional capital to acquire tens of millions of new users. Notably, Carry1st is expanding into game co-development, working with leading game studios on original concepts, and developing the infrastructure to support play-to-earn gaming.

“We’re excited to partner with this world-class group of investors who, in addition to capital, bring expertise across gaming, fintech, and web3,” said Cordel Robbin-Coker, Co-Founder and CEO of Carry1st. “In 2021 we launched multiple games and digital commerce solutions achieving really strong growth. Together we can accelerate this growth and achieve our goal of becoming the leading consumer internet company in the region.”

Africa is the next major growth market, driven by rapidly increasing technology adoption among the continent’s 1.1 billion millennials and Gen-Zers. A report released in 2021 from Newzoo and Carry1st, showed that the number of gamers in Sub-Saharan Africa is set to increase by 275 per cent over 10 years, leading to a 728 per cent increase in revenue. Carry1st has positioned itself to be the conduit for international and local mobile game companies to profitably serve these consumers.

Carry1st provides a full-stack publishing solution, handling user acquisition, live operations, community management, and monetisation for its partners. The company enhances monetisation in the region through its embedded payments solution and online marketplace for virtual goods, which allows underbanked customers to pay for content in their preferred way.

Andreessen Horowitz General Partner David Haber adds: “We are delighted to be making our first investment in an Africa-headquartered company in Carry1st, a next-generation mobile games and fintech platform. We see immense opportunity for the company to mirror outstanding successes we’ve seen in markets like India, China, and Southeast Asia. We couldn’t be more thrilled to partner with founders Cordel, Lucy, Tino, and the Carry1st team on their mission to build the Garena of Africa.”

The company recently partnered with online payments pioneers PayPal, to enable people across Africa to easily and securely purchase virtual goods – such as Tinder subscriptions, mobile data, and gaming currency – on the Carry1st Shop. Consumers can pay via a range of local payment options including crypto, mobile money, and bank transfers.

Carry1st has signed publishing deals for seven games from a number of leading studios including Tilting Point, publisher of Nickelodeon’s SpongeBob: Krusty Cook-Off, which Carry1st recently launched in Africa. Other gaming partners include CrazyLabs, a world-leading casual and hyper-casual mobile games developer and publisher and Sweden’s Raketspel, a studio that has over 120 million downloads across its portfolio.

The company, founded by Cordel Robbin-Coker (CEO), Lucy Hoffman (COO), and Tinotenda Mundangepfupfu (CTO), employs a team of 37 people across 18 countries, including mobile gaming veterans hailing from Rovio, Socialpoint, Ubisoft, and Wargaming.

Nitin Gajria, Managing Director for Google in Africa, adds: “We’re thrilled to partner with Carry1st to unlock the mobile gaming industry in Africa and support the team as they scale solutions to the hundreds of millions of new consumers coming online for the first time.”

More than a fifth of British adults have been tricked out of money by financial fraudsters, losing on average £1,002, according to new research by Kalgera.

This rises to £1,523 for people who have a carer while those aged 25-34 lose the most at £1,355. Of those who have lost money, 3% have lost £10,000 or more.

Despite this week marking one year since the Financial Conduct Authority (FCA) issued guidance for banks and building societies to protect vulnerable customers, who are often more susceptible to scammers, financial vulnerability has risen. The FCA guidance has been designed to help financial institutions better understand the needs of vulnerable customers to enable them to make any necessary changes to ensure they are treated fairly.

But the Cost of Living crisis is only going to increase the levels of vulnerability, according to Kalgera, an AI powered platform designed to help banks and financial institutions identify and protect vulnerable customers from financial harm. The research it commissioned found that a staggering two in five (21%) respondents self-identify as financially vulnerable.

The pandemic, coupled with a hike in the cost of living, has taken its toll on the physical, mental and financial health of the nation with 17% of Brits admitting they don’t think through financial decisions as well as they did before the Covid-19 pandemic and 21% say they are struggling financially.

Despite the FCA guidance, the scale of the problem appears to have increased – and 39% of people say they are fearful, anxious or concerned that they will be targeted by a scammer. This rises to almost two thirds (67%) for those who have a carer. More than half of UK adults don’t think banks and building societies do enough to help customers who are financially vulnerable, rising to 68% of those who have a carer while 29% don’t know where to get advice, rising to 53% for those who have a carer.

Dr. Dexter Penn, Founder of Kalgera, said: “In the year since the FCA issued guidance for banks and building societies to better protect vulnerable customers it has become clear that the problem has worsened because of the pandemic, rising living costs and opportunistic fraudsters. Most of us know someone who has been targeted by fraudsters; the frequency of more sophisticated scam approaches has rapidly increased as the majority of payments are now digital and cashless.

Added to this, the increase in people using digital services such as online banking – some for the first time – has created more opportunities for fraudsters. More than 4 in 10 (41%) people say they have been targeted by a would-be fraudster since the beginning of the first lockdown (March 2020).

Worryingly, 28% of people admit they don’t feel entirely confident or safe using online banking services while a quarter (26%) have bought something after seeing a sale or promotion on social media or via an unsolicited text or email from a brand unknown to them.

“There is concern that we will see a rapid increase in the number of people experiencing financial vulnerability, which leaves people more susceptible to becoming a victim of financial fraud. To reverse this trend, industries, including finance, technology and healthcare, need to come together to improve the way we detect the drivers of vulnerability and intervene before people are tricked into parting with their hard-earned money,” added Dr Penn.

The concept of the metaverse has accelerated massively since Facebook rebranded itself as Meta, encompassing all its affiliated companies. This allowed many to view the digital reality as something more outside of its gaming context. But what does this really mean and how will companies respond?

In a career spanning decades, Jawad Ashraf has been at the forefront of innovation in emerging technology. Having pioneered software development in industry and enterprise, he’s been a driving force in the early adoption of progressive technology. As CEO and co-founder of Terra Virtua, he’s an industry leader in NFTs, blockchain and the metaverse.  

Speaking to The Fintech Times, Ashraf analyses what the metaverse is at its core and how it will develop: 

The metaverse dominates news headlines and conversations, and in recent times interest has skyrocketed. Companies such as Meta (previously Facebook) and Microsoft, alongside brands like Disney and Manchester City Football Club are jumping on this latest tech trend, that allows users to play, work and socialise in virtual environments. But many questions still surround this emerging industry and technology.

What is the metaverse?

When thinking about the metaverse, it’s important not to think about it as a singular entity, but a series of virtual spaces that will overlap each other. An interconnected network of metaverses, which will enable new experiences, communities, opportunities to learn, places to game and much more. Virtual spaces which will grant the ability to experience more than we can in the real world, enhanced and unrestricted by physical limitations.

In many ways, the metaverse is an evolution of connected networks like the internet. However, it is important to remember that many metaverse projects are still in the trial-and-error phase. What we will see is successful projects and failures, as the metaverse’s true purpose is defined. We’re at a point where projects are blazing a trail into the metaverse, and hopefully we’ll soon be able to fully experience what it has to offer.

How does the metaverse work?

Despite a growing understanding of what the metaverse is, and more brands and individuals working out how they can get involved – we aren’t quite there yet. Currently, there are some isolated examples of companies building the infrastructure that could become metaverses. Think Meta, its rebrand from Facebook and Virtual Reality (VR) programme; and games like Fortnite and Roblox, with avatars (virtual characters that represent users), their own economies and live events that allow users to go beyond gaming.

The great thing about the metaverse is that there will be no set boundaries for what each virtual world might look like and how to access them. For now, users access the metaverse through their avatars. However, you can’t take your avatars and digital assets with you wherever you go, to use in another world or metaverse, and you can’t freely move between virtual places.

Once fully formed, the metaverse will be more like a network of virtual worlds. You’ll be able to move through connected virtual environments seamlessly, using fully immersive VR that overcomes the barriers of glass screens and heavy headsets. What’s more, in the future, we’re expecting it to be a far more immersive experience, blurring the boundaries between the real and virtual world.

What can you do in the metaverse?

One day, you’ll be able to do almost everything you can do in the real world in the metaverse. Only you’ll have all the benefits of the virtual world – convenience, enhancement, everything at your fingertips, without physical barriers such as geography – with the capability to interact with others and the environment as deeply as you can in the real world.

In the meantime, there are a number of experiences already available to us in the metaverse. These include:

• Entertainment: From socialising with your friends, to attending virtual concerts and weddings.
• Virtual Property: People are increasingly interested in climbing the virtual property ladder through NFTs and purchasing homes, land, events, space and even yachts.
• Gaming: Some users are gaming not only to make friends, but to make money via play-to-earn games such as Nitro League and Axie Infinity.
• Working: Increasingly, workplaces are investing in VR headsets, allowing employees to get together in virtual workspaces and new starters to be on-boarded.
• Learning: Platforms are reinventing virtual education, offering interactive and immersive educational experiences through VR and AR.

Are you ready player one?

We’re at the start of something big and we’ve still got a way to go until we truly see what the metaverse can offer. There is still much to be built, and many key decisions to be made – including how it will be regulated; how it will affect and be affected by real world events and restrictions; and what exactly it will offer us.

The movie Ready Player One is the perfect example of what we want to achieve in the metaverse, but we need to avoid potential pitfalls – we need to make sure there is a layer of regulation and protection especially when it comes to identify, anonymity and data retention.

The metaverse will create a big societal shift, we are truly stepping into a space that has never been explored before, there will need to be rules to ensure everyone is made to feel welcome and can enjoy everything the metaverse has to offer.

About Terra Virtua:

Launched in 2017, Terra Virtua is a digital collectibles platform built on sustainable blockchain technology. Which offers immersive collectible, gaming and social experiences, through NFTs, and provides a gateway to the metaverse.

Jawad Ashraf, CEO and CO-Founder of Terra Virtua: https://www.linkedin.com/in/jawadashrafuae

In September 2021, the People’s Bank of China and nine other Chinese government authorities jointly released the Circular on Further Preventing and Handling the Risks Concerning Speculation in Virtual Currency Trading. Together with another official notice to stamp out cryptocurrency mining, cryptocurrency-based mining and other crypto-related activities in China are set to be tightly regulated. 

See this alert from our China fintech team which summarises some of the recent related regulatory developments and discusses several hot topics such as NFTs and China’s Digital Yuan Plan.

The UK retail sector is undergoing a revolution in consumer behaviour, leaving many merchants with stark choices to make about their business models. Two years of the global pandemic and its associated restrictions on movement have turbocharged a seismic structural shift from in-store to online shopping.

Fuelling this trend even further have been recent innovations in financial technology that make it easier and more convenient for retail consumers to purchase the items they need. The sheer pace of change has put players in the retail and payments landscape under pressure to adapt and offer greater flexibility, and checkout finance has emerged as a key transformation in the sector.

Rob Fernandes is Chief Product Officer of Deko, the leading retail finance ecosystem. His experience includes twenty years in payments and fintech, leading product strategy across a number of businesses as well as advising many others including Wepay, Vocalink, Nexi, Paysafe, Natwest Tyl, Yoyo Wallet and Tink. 

Here he shares his thoughts on how new BNPL fintech is upending the retail sector.

Going beyond mainstream BNPL

With the UK’s e-commerce market forecast to be worth £264bn by 2024, a 37% increase on 2020 levels, the significance of checkout finance will only continue to grow. Yet the one-size-fits-all approach used by many buy now pay later (BNPL) brands has its limitations. Early BNPL offerings in the UK boosted conversion rates using simple, single lender products. But, despite their rapid growth, demand in the market has evolved across different sectors and basket sizes and it is now possible to further optimise acceptance for long-term success.

While there have been innovations in consumer experiences that have increased checkout impact for merchants, less focus has been given to boosting flexibility and coverage of financial products to address different consumers and their purchase goals. Nor has there been enough attention paid to accelerating the integration of these solutions, broadening sector reach, and making everything available through one platform.

Mainstream BNPL products are already going beyond the limitations of traditional cash and credit cards – spending via this method in the UK is forecast to rise from £9.6 billion in 2020 to £26.4 billion in 2024. Checkout finance products are increasingly expected as standard; already almost 9.5 million UK consumers avoid retailers that do not offer BNPL at checkout and nearly a fifth of UK adults now use BNPL services once a month.

The next stage of innovation will include platforms that aggregate both short-term BNPL and higher value and longer-term monthly instalment finance. They will also operate across a wide spectrum of risk appetites with a panel of lenders including prime and near-prime underwriters, and credit providers covering different sector demands. This will mean far fewer abandoned baskets and more sales – helping merchants make the most of their e-commerce capabilities.

Catering for all basket sizes

In the UK, some 41% of consumers have abandoned a transaction during the online checkout process, while 24% have walked away from a purchase in physical stores. A Barclaycard survey also found that, on average, British shoppers abandon £30 in online shopping baskets per month. A lack of payment options is a leading reason for this, with research showing that close to 10 million Britons chose not to buy from merchants that don’t offer alternative payment methods at checkout.

With the sharp rise in living costs due to inflation unlikely to slow down in the near future, many customers are reluctant to spend one-off sums of money on certain purchases. This doesn’t merely affect sales in smaller price ranges such as beauty or fashion, but can impact merchants who offer services like online education, healthcare, or home improvement. Providing finance options for a range of basket sizes is imperative to support the businesses underpinning the UK economy.

Deko’s technology matches customers with a marketplace of lenders during the purchase journey, increasing the approval rate of applications for finance at checkout and giving consumers the best chance of securing the goods or services they want. By guaranteeing the best match between consumers, merchants and lenders, merchants can gain an average increase in sales of almost 30%. With its proven plugins, the platform can also be installed into existing infrastructure in as little as 24 hours, ensuring minimal disruption to merchants’ business operations while delivering the finance tools their customers need online and in-store.

The next wave in payments innovation is here

It is clear that the upward trend driven by a convergence in online retail and fintech is accelerating, and the payments industry is alive with innovation. Checkout finance represents a permanent shift in the way in which both retailers and customers view payments based on choice and flexibility. But new platforms are going a step further – simultaneously optimising customer experience and coverage and acceptance too. Checkout finance aggregation can take this payments evolution to the next level, offering tailored, conversion-focused solutions to retailers and consumers alike.

About the company: Deko is a multi-product, multi-lender retail finance ecosystem focused on expanding access to retail finance for lenders, merchants and customers.

On this weeks episode of News & Views, The Fintech Times POdcast team speak on Esports, the future of Cybersecurity in Singapore through educational programs and Facial Recognition.

After experiencing first-hand the shortcomings of traditional collection agencies, Australia-based InDebted’s CEO and Founder, Josh Foreman, envisioned a better way with a product-led solution that is changing the world of consumer debt recovery for good. 

Foreman is a self-professed engineering nerd, with a background in computer science and a love for building great products and turning these products into companies. Using data science and digital communication, InDebted is placing the experience of people in debt at the centre of the process, rather than the amount they owe – disrupting a global industry to improve overall financial wellbeing, providing real support and real options to people at the time when they need it most. 

Here Foreman explains how his fintech successfully implemented the four-day working week, and discusses the lessons he learnt from doing so. 
NOWADAYS, it feels like you are never too far away from a discussion about the future of work. The pandemic has led to an explosion in the adoption of new working practices, whether that be a shift to hybrid working, working from anywhere, or even trialling new initiatives like the four-day working week.

We are all invested in the follow-up from the pandemic, how companies navigate shifting work patterns, as well as the demand for flexibility. The Great Resignation and subsequent ‘War for  Talent’ has further lifted the lid on the need for companies to adapt to the changing needs of workers, in tandem with new customer demands.

Employees are no longer content with a traditional nine to five, five days a week, and lengthy commutes. With the pandemic bringing about innovation in this space, the time for sitting on the fence has passed. Those who have not taken the opportunity to adapt face being left behind.

Our own path at InDebted has always started with questioning what has been done in the past and finding a better way for everyone. It’s this approach that truly sets us apart from traditional debt collectors. We have embraced technology and personalisation to improve outcomes for consumers, and we have sought to do the same for our employees.

We see the four-day working week as an opportunity to get the job done in a new way for our 250 employees, located across 11 countries while supporting their wellbeing. We see this flexibility as a key pillar in turbocharging InDebted’s growth, while maintaining our customer-centricity.

Our Story: How InDebted Implemented the Four-Day Working Week

In 2021, InDebted launched the four-day working week with an opt-in pilot programme for select teams in the business. This enabled us to monitor feedback during manager check-ins and see how this scheme would impact productivity across the business.

Following this trial period, we took a phased approach to transition our teams to this new way of working. This enabled us to take into consideration each teams’ unique needs, adjust hiring requirements, and address any issues with team goals so that no member of the company was worried about this move.

Our project management team further facilitated a comprehensive review and discussion with each department to carefully plan the transition to a four-day workweek company-wide.

During this period, we encouraged everyone to utilise asynchronous working tools for collaboration and more efficient ways of working. Meetings have become less part of the day – a sigh of relief for those experiencing Zoom fatigue – and when they did occur, calls were more focussed. We also hired additional resources to smooth the transition for teams like IT and customer service where there is an obvious need for an always-on 24/7 service.

The Evaluation: What We Learned From Implementing the Four-Day Working Week

Since implementing this programme across the company, the four-day working week has boosted our performance and supported our international expansion.

Since implementing our four day work week in September 2021, our headcount has grown by 71 new employees. As the business scales into new and global markets, the shortened working week has had a tangible impact on our talent acquisition in a highly competitive candidate market.

Following the launch of the initiative, there were more applicants for open roles in the first 45 days than the preceding four and a half months, with our average number of applicants increasing by 283 per cent. The four-day working week is a key differentiating factor for those that choose to come work with us.

With shorter work weeks, employees are given roughly 416 hours back every year to disconnect, take care of themselves and their families, and pursue passions outside of the office.

There have been amazing stories of how employees are using their extra day, whether that be volunteering for organisations fighting against climate change, starting up their own side hustles, or just being able to have more time with family. In our January pulse survey, 97 per cent of employees said that the four-day working week positively impacts their wellbeing.

Our Learnings: Advice if You’re Considering the Transition

When implementing a radical new workplace initiative, uptake has to come from leadership.

Leaders in the business need to set the precedent,  advocating for their team members to take their Fridays off and setting realistic expectations for the rest of the business to plan their weeks and manage their workload.

Transparency, communication, and visibility are important to ensuring the success of this scheme and will determine whether your business can make a success of it. Having the right tools in place that support asynchronous communication, collaboration and efficiency have been critical to the success of this rollout at InDebted. Getting this right has been vital to ensuring that our clients and consumers receive first-class service.

For InDebted, the four-day working week is just the start as we aim to create a winning formula for the future of work that works for both our employees and our customers. We don’t sit on our hands when it comes to supporting our team members,  and the results for the business and consumers from this initiative speak for themselves; higher retention; better and quicker recruitment; improved productivity whilst maintaining a high-quality, 24/7 customer service; and employee wellbeing ratings going through the roof.

As we expand into new territories, the bold steps we take to support our employees enables us to attract the best fintech talent in the market, benefitting our clients and customers alike.

The business succeeds when our employees succeed – the four-day working week embodies this.

Standard Chartered has announced it has partnered with the International Air Transport Association (IATA) to launch IATA Pay in India. IATA Pay, which is already available in several European markets, is an airline industry payment platform that brings optionality, convenience and an enhanced experience to consumers when purchasing tickets directly from participating airlines. The service leverages the Unified Payment Interface (UPI), a domestic real-time payments scheme in India, thereby enabling consumers to instantly pay for airline tickets from their bank accounts.

In addition to existing payment options such as credit cards, IATA Pay will be a new payment option that enables participating airlines to offer instant payment options such as UPI Scan & Pay and UPI Collect (Request to Pay). This new service will not only help participating airlines avoid bilateral integrations with multiple service providers, it also eliminates the need to pay an acquiring fee to card acquirers.

IATA Pay in India is powered by Standard Chartered’s Straight2Bank Pay, a payment platform that helps online merchants digitalise collections via multiple payment options through a single global connectivity.

Philip Panaino, Global Head of Cash, Transaction Banking at Standard Chartered, said: “We are proud to partner with IATA in launching this new service for the aviation industry in India. IATA Pay reflects our commitment and focus in driving payment innovation and building solutions that are not just fit-for-purpose, but also deliver value to all participants in our clients’ ecosystem. This new service will simplify the payment process for the consumers, streamline the collection and settlement process for airlines, as well as enable IATA to provide an industry-wide e-commerce solution”.

Javier Orejas, IATA’s Global Head of Banking & IATA Pay, said: “We remain steadfast in our commitment to simplify the payment process and drive enhanced experience for airlines and air travellers. As the industry rebounds in the post-COVID world, innovative and cost-effective solutions have become more significant than ever. IATA Pay underpins our focus on leveraging open banking and real-time payment solutions that will serve as a cost-effective alternative to conventional payment methods and bring efficiency to how money is collected and settled”.

The launch of IATA Pay builds on Standard Chartered and IATA’s existing partnership to co-create an industry-wide payment solution. In 2021, the two organisations launched IATA EasyPay in India, a pay-as-you-go payment solution that streamlines the ticketing and settlement process among IATA-affiliated travel agents, member airlines and IATA.

Following the launch in India, Standard Chartered will be supporting the rollout of IATA Pay in other markets.