What Is Data-to-text? Everything You Need to Know About It

Currently, there are 2.5 quintillion bytes of data created each day, reaching almost 40 zettabytes in 2018. Over 90 percent of the data in the world was generated in the last two years alone.

Data generation is expected to increase at an exponential rate as the number of connected devices continues to grow, thanks to technologies such as the Internet of Things (IoT) and 5G, as well as a reduction in the cost of electronic data storage.

Annual size of the global datasphere

A lot of data, which can contain very useful and beneficial knowledge, remains unused and unanalyzed due to human limitations iEn processing such vast amounts of information in a practical manner.

What Is Data-to-text? An Introduction

Natural Language Generation (NLG) is a subarea of the field of Natural Language Processing (NLP) focused on the construction of understandable text in natural language automatically. Data-to-text (D2T), a key component of NLG, covers the transformation of data into natural language.

The key difference between D2T versus other areas of NLG is that the input information does not come in another form of natural language, but in the shape of non-linguistic electronic data. This data is frequently structured data, i.e. stored as fixed fields within a record or file such as relational databases or spreadsheets.

Thanks to recent and spectacular developments in deep learning technologies, the data can also be unstructured. Unstructured data includes images, audio and video recordings, whose content can be translated to text and subsequently used to produce long narratives with D2T data-to-text techniques.

What Are the Applications of Data-to-text?

The potential applications of D2T are innumerable. Any report or communication based on structured input data can be automated. Here are some examples where the technology can be utilized:

• Journalism. Generate automatic news articles. Data-heavy topics such as sports, weather or financial markets are very well suited for these applications. In fact, this is one of the areas with the current highest penetration of D2T solutions. Narrativa is currently producing circa half a million articles in English, Arabic and Spanish every month, covering a variety of different topics such as sports, finance and weather.
• Business Intelligence tools. Enhance the normally graphical output of business intelligence tools for analysis and research. In order to extract meaning, numbers require calculations and graphs require interpretation. Users can then benefit from a combination of graphs and natural language to bring to life insights found in the data.
• E-commerce. Generate the descriptions of products being sold online. This is particularly useful for marketplace businesses that can offer millions of different products with high SKU rotation and in multiple languages. These product descriptions could even be generated considering the particular needs and interests of each individual customer, greatly enhancing the effectiveness of the already very successful recommendation systems of big e-commerce players.
• Business management. Generate required business reports for management, customers or regulators. This saves a lot of time and resources so that businesses can focus on decision-making as opposed to reporting.
• Customer personalization. Create personalized customer communications. Reports can be generated for “an audience of one”, and can even be generated in real time when users interact with the business through digital channels, providing information in real time.

What Are the Advantages of Data-to-text?

The use of D2T technologies present some very clear benefits over more traditional approaches, namely:

• Cost. D2T technologies can produce content at a cost at least 10 times lower than traditional human writing, and even higher in domains with highly-skilled, highly-paid staff. This even permits unearthing content that otherwise would never be analyzed and commented on due to lack of resources or the impracticality of writing for very small audiences. D2T makes feasible writing narratives for an audience as small as one person feasible.
• Production time. The conversion of data into text, once the system has been set up, is done in an instant. This is of particular interest in areas where it is important to report on recent information (e.g. news or personalized real-time reporting)
• Accuracy. Computers do not make mistakes or write typos. The only requirement is clean, correct data in order to obtain 100% accurate interpretation and analysis.
• Clarity. Information presented in natural language is easier to understand. In an experiment from 2017, the researchers found that the use of NLG content enhances decision-making under uncertainty, compared to state-of-the-art graphical-based representation methods.
• Scale. As long as there’s new data, there is no theoretical limit as to how much output volume can be generated, allowing an unlimited number of users to benefit.

What Are The Disadvantages of Data-to-text?

There are, however, some limitations to the broad applicability of these solutions, including:

• Lack of creativity. Machines cannot yet produce as much variety of content as humans can. Contrary to popular belief, this is not due to the inability of computers to create new ideas but to the limitations imposed by the data.
• Limited scope. Currently, machines using D2T techniques can only talk about the information present in the input dataset. This greatly contrasts to a human’s ability to gather information from other sources such as industry common knowledge or analogies.
• Setup time. In order to deploy D2T technologies to new areas, techniques must be customized for the specific domain of interest.
• Rigidity. State-of-the-art techniques require important customization for the deployment of each specific use case. Whenever there are important changes in the data source or application requirements, the technology needs to be retrained and reconfigured.

Despite the attractiveness and effectiveness of D2T solutions, the implementation of this technology is still quite limited. These limitations fall into two main categories:

• Lack of awareness. Most people are not aware of the existence of D2T solutions and are very surprised by the quality of their output. In simple terms, these technologies are not often utilized because potential users do not know they exist.
• Lack of input data. Not all knowledge domains have sufficient data with the required volume and quality to automatically produce interesting content. Even when the data does exist, sometimes the owner has neither the knowledge nor the expertise and interest to exploit it, foregoing the opportunity to extract insights and value from that information.

Article written by David Martínez de Lecea and published in Plug and Play on 24 April 2019.

The New Frontier: The Rise Of Fintech Brings With It New Opportunities

Any new technology brings disruption to the established order. But can it also bring new opportunities? Fintech, for example, is big business. In 2016, according to KPMG, US$24.7 billion was invested in fintech companies globally. Even though this represented a reduction on 2015, after what KPMG called ‘a challenging year’ for fintech, it is still a significant figure.

A survey from Innovate Finance showed that in China last year fintech swallowed up US$7.7bn of investment, while in the US and the UK the figures were US$6.2 billionn and US$783 million respectively. And while fintech investment in the UAE has lagged behind those levels, it is set to be transformed over the next few years. According to a report by Wamda Research Lab, the UAE leads the way in the MENA region, with US$50 million in growth expected next year alone, adding to the US$100 million already invested in fintech over the last ten years. Wamda predicts that by 2020 the number of UAE fintech companies will more than double from 2015 levels, to around 250 firms.

Defining fintech 

When we talk about fintech, we mean financial technology, but in particular we mean new, disruptive and non-traditional ways of operating. Examples are crowdfunding platforms, peer-to-peer (P2P) payment services, and new approaches to lending and raising capital, as well as payment solutions like the standard bearer PayPal.

In fact, payments and lending businesses represent 84% of all MENA fintech startups today. According to Wamda, two-thirds of the 250 predicted fintech companies operating by 2020 will be payment, lending and capital raising platforms. A good example from the UAE is Payfort, a Dubai-based online payment system, which processed more than AED3bn in payments during its first year of operation. 

Firms like this are the new kids on the block, and bring tech-enabled products and services that improve on traditional ways of working, often where nobody else has seen an opportunity or need for improvement. They’re normally startups, so while they’re seeking big growth as rapidly as possible, they’re often as keen on collaboration as they are on competition. We’ll see why that’s important later.

What’s been the fintech impact so far? 

Although fintech has had a slower start in the region than elsewhere, the UAE is a potentially lucrative breeding ground. Currently 86% of the country’s population does not have a bank account. While that can mean no financial record and no credit score –which can be an obstacle to providing financial services– one thing the UAE does have is very high smartphone penetration. In a country where e-commerce is set to quadruple over the next five years, this is where the ‘tech’ part of fintech comes into its own. Startups can serve sections of the market that traditional providers can’t. They’re smaller, more flexible and more responsive to change than larger corporations and, even among those customers who do have bank accounts, many are keen to explore new ways of working. A recent survey from YouGov and Payfort found that, of 1,429 banking customers in the MENA region, almost half were interested in exploring working with new companies that offer payment, lending and investment services.

While the early movers in UAE fintech investment were mainly focused on making and receiving payments, the second wave of new fintech firms in our region includes firms working in areas, such as wealth management, reflecting the trend in other markets, such as the US. For example, there have been new fintech startups in the region providing both robo-advice and tailored investment solutions built around a client’s risk appetite, income and investment time horizons. Platforms such as Finerd didn’t even necessarily require Gulf Cooperation Council (GCC) residents to open an account, and attracted significant interest particularly from expats.

How does it affect brokers?

Technology generally makes things happen more quickly. For a broker, that can be good and bad. On the one hand, it gives clients more opportunity to do their own research, and robo-advice can give people means to manage their own wealth without involving a broker. These automated services can provide unrelenting, real-time insight on the move. It’s a proposition that chimes with an audience of investors, many of them millennials who are already well versed in social media and concepts like P2P. And while the UAE isn’t quite there yet, online solutions don’t fear national borders. 

On the other hand, not all clients have the time or the confidence to go it alone, or to wade through the profusion of information on offer. So, while cutting out the middleman can seem appealing, conversely it can draw attention to the middleman’s value and expertise, which can be a beacon of sense in a sea of numbers. Meanwhile, as automation gives back more of a broker’s working hours, there’s extra time to conduct research and hone that professional insight.

Another area where fintech has contributed positively is risk. Risk management in banking has changed dramatically in the years since the global financial crisis, and one of the ways new technology has contributed is in machine learning– the ability of automated systems to improve the accuracy of data models. While still in its infancy in wealth management, the potential of automated systems that can incrementally improve risk models -while saving both time and money– is compelling.

Fintech isn’t going away, and people are increasingly receptive to it. Brokers who embrace it and find a way to combine its speed, accuracy and convenience with their professional knowledge, hard-won experience and real customer service can reposition themselves as the forward-thinking ‘best in breed’ in the market. They can absorb the advantages of fintech and automation, while at the same time offering expertise and experience that the newcomers can’t. Collaboration can give savvy brokers a way to market themselves as innovative and groundbreaking, leading clients through the cacophony of fintech noise.

The power of collaboration

Fintech firms themselves are well aware of the value of this kind of collaboration. According to Wamda, almost nine in 10 UAE fintechs seek an established collaborator, while a report from Accenture shows that those who choose to collaborate, rather than compete directly with the establishment, are getting the lion’s share of the available investment.

Fintech startups can also use collaboration with established players to help navigate regulatory hurdles. As fintech specialist David Martínez de Lecea noted, this is one of the biggest challenges faced by new fintechs in the investment space, which can require a complex and time-consuming set of licenses. He also pointed out the idiosyncrasies of the UAE ‘know-your-customer’ (KYC) laws, which apply extra due diligence requirements, particularly to politically exposed persons. This kind of work is something that doesn’t come naturally to robots, and is another potential advantage for real brokers.

So, fintech startups as well as established financial institutions have clear opportunities to help one another. Where established firms may lack innovation, fintechs often face issues around regulation, reputation, trust and security which collaboration with an established firm can help mitigate. 

Digital Darwinism

However, while many firms are grasping the opportunity (or need) to embrace fintech, many are yet to open up. PwC research found that, globally, 67% of established businesses surveyed saw pressure on margins as the biggest threat from fintech, while 59% believe the biggest danger was loss of market share. Yet, when asked whether their organisations had put fintech at the heart of their strategy, 24% either didn’t know or actively disagreed.

In a recent interview, author Ray Wang put it succinctly, saying ‘Digital Darwinism is unkind to those who wait’. The march of fintech in the UAE has begun and isn’t going away. In their recent survey, Wamda found that 98% of fintech startups in the UAE plan to expand their activities. The key international financial centres and their regulators are starting to get behind it too. To demonstrate this, Dubai International Finance Centre (DIFC) recently launched its FinTech Hive accelerator, hot on the heels of Abu Dhabi Global Market (ADGM) unveiling its new fintech sandbox.

From the days of the machine-smashing Luddites in the early nineteenth century, there have been three general responses to new technology. You can resist it and be overwhelmed. You can ignore it and risk being blindsided along the way. Or you can embrace it and learn not only to live with it, but to harness its power. Those who are successful will see the future not so much as the rise of the machines, but rather as the coming together of natural ability and new technology. So maybe the future of a successful broker in the new fintech world will be a blend of old-fashioned skill and brand new efficiency, able to unleash real expertise more quickly and accurately than ever before. 

Article written by Marco Saviozzi and published in appMedia on 23 August 2017.

IT staff recruitment poses major challenge in UAE and wider region

Organisations in the Middle East must create competitive IT recruitment strategies if they are to attract the right people

Organisations in the UAE face a challenge to attract and retain top-quality CIOs and other key IT staff as the region seeks to tackle a technology skills gap.

As the UAE pushes ahead with its digitisation agenda, the ability to attract and retain IT talent is critical for local enterprises – and salary levels are no longer the be-all and end-all for IT professionals.

The Middle East as a whole is suffering a shortage of IT professionals with the right skills and experience. For example, figures from Cisco show that the Middle East was short of 48,000 skilled networking staff in 2012, and that number had grown to over 100,000 by 2015.

“This gap is a direct result of the positive news that the UAE is embarking on a period of intense digitisation,” said Mike Weston, vice-president at Cisco in the Middle East. “But the flipside of this is that the country faces a shortage in the number of skilled IT workers required to turn these digital dreams into reality.”

However, the UAE has put itself in a good position by creating a culturally tolerant business environment designed to attract a growing number of overseas workers, said Weston. The country also maintains the advantage of acting as a hub for the broader Middle East region, with many multinational IT organisations using it as their regional headquarters, he added.

“This dynamic means that skills, particularly advanced technical skills, are more readily available than in some other Middle Eastern countries,” he said. “The UAE is also one of the more mature in terms of technology adoption in the region, which is one of the reasons for the high growth in demand for emerging technology solutions.”

But as the UAE continues to drive its digitisation and economic diversification efforts, it is experiencing a particularly acute skills gap with new IT positions. According to recruitment firm Robert Half UAE, professionals with skills in IT security, virtualisation, mobility, ITIL and Cobit, the internet of things (IoT) and convergent technologies are currently in great demand and will continue to be sought after for the next few years.

Gareth El Mettouri, associate director at Robert Half UAE, said other key technology positions to fill included enterprise resource planning (ERP) application and functional experts, project managers, business partners and IT security managers.

“The technology sector within the UAE is growing rapidly as firms update their systems and adopt emerging technology to compete more effectively on a global scale,” he said. “Firms are seeking professionals who not only have technical expertise to execute these projects, but also have a collaborative nature and cultural fit.”

El Mettouri added that the local technology sector was progressing to meet international best practice standards in cyber security, cloud integration and business transformation.

“As multinational corporations in the region review their operational standards on a global level, the implications are having an effect within the region,” he said. “These businesses are eager to hire the specialist talent within Dubai to drive these changes.”

Nelly Boustany, regional head of human resources at SAP, agreed that technology was changing rapidly, and senior executives in the UAE needed to drive organisation-wide skills development to bridge the talent gap.

“With 100 million young people entering the Middle East and North Africa workforce by 2020, more than half of UAE organisations (54%) said millennials are impacting workforce strategies,” she said. “It is vital for UAE organisations to develop a talent pipeline starting from university, with key differentiators for millennials including a good work-life balance.”

El Mettouri agreed that pay was not the only factor in retaining talented tech staff. “For organisations looking to attract and retain key technology experts, they not only need to offer remuneration packages that are competitive on a local and international scale, but they also need to review their job offers for work-life balance and be able to provide training and development opportunities that will support the individual’s career progression plans,” he said.

David Martinez de Lecea, principal at strategy consultancy Roland Berger, said most IT professionals were looking for opportunities to work with new and promising technologies, rather than old systems and frameworks. Specifically, the importance of artificial intelligence (AI) for most industries is making companies with access to large data pools attractive workplaces for AI specialists, he said.

“In the short term, the biggest barrier to hiring and developing IT skills is the high administrative costs associated with employment, particularly if sourcing from abroad,” he said. “In the long run, the development of home-grown talent in universities of technology and specialist centres is the best way to ensure the availability of a vibrant IT labour force.”

The skills gap, particularly in the ICT field, continues to be a top government priority in the Gulf region. To address the skills shortage, regional governments are deploying policy and training programmes to help solve what Cisco calls “the world’s fastest-growing gap in networking professionals”.

Cisco’s Weston said specific programmes and targeted policies were needed to expand the total pool of qualified IT staff in the region. “More effort is particularly needed to expand networking talent by increasing the number of new networking employees (new graduates), encouraging and enabling mid-career professionals to transition to ICT and networking and increasing the country’s total talent by encouraging immigration,” he said.

Saeed Agha, general manager – Middle East at Palo Alto Networks, said competition for scarce IT talent was a global challenge, “particularly so with talented cyber security resources that we come across when working with our customers and partners in the UAE”.

Agha said common practices such as creating a trusting environment, acknowledging top performers, and clear, transparent communication were essential for organisations to compete in the UAE talent market.

He said IT staff retention could be improved by “offering a challenging work environment that matters and creating a sense of purpose for your employees, ensuring they feel connected to the business and its mission”, adding: “It is also important to provide growth opportunities and flexibility for changing roles and focus domains for your IT employees.”

According to Computer Weekly research, more than half of organisations in the Middle East plan to reduce the amount of money they spend on IT staff in 2017, despite the skills gap. While only 17% of IT decision-makers surveyed by Computer Weekly/TechTarget expect overall IT budgets to be lower in 2017 than in 2016, 53% expect a drop in budgets allocated to IT staff.

Article written by Alicia Buller and published in Computer Weekly on 7 March 2017.

Virtual reality takes off in the Gulf Cooperation Council countries

There is a thriving virtual reality industry in the Middle East, with the technology’s application expected to go far beyond gaming

The UAE is mirroring global trends by eagerly adopting virtual reality (VR) technology. At last year’s annual Dubai-based tech show, Gitex, a major focus was placed on VR products and how they can support the region’s rapidly expanding travel, hospitality and media sectors.

 Dubai-based digital media house Reach Mena, for example, launched its first virtual reality product last summer to support its creative studio. Through Sense R, as it is known, the company offers a platform to businesses to engage with audiences and make promotions.“Property developers currently use 3D models to promote their projects, but with VR they are able to show potential customers more accurate 360-degree views,” said Usman Ahmed, senior account manager at Reach Mena.

Similarly, hotels are using virtual reality to display hyper-realistic footage of their facilities to encourage guests to stay with them.

For government entities, VR is a much more effective tool than traditional media for getting messages across to the public. “We’re using our technology with government departments, especially for training and awareness campaigns,” said Ahmed.

Google’s global VR chief, Clay Bavor, has stated that by 2026, virtual reality will be almost indistinguishable from reality. With numerous multi-billion dollar corporations competing for both the consumer and enterprise VR market globally, it’s likely that innovation could come about at a lightning pace.

David Martínez de Lecea, principal at Roland Berger Dubai, said: “When one looks at how much computer-generated environments have improved in just a few decades, there seems to be no reason to believe we will not be able to perfectly replicate reality in virtual environments. In fact, some people argue that there is a very real possibility we are already living in a virtual world.”

In line with steep global VR hardware growth rates, research firm IDC reports that annual spend on augmented reality (AR) and virtual reality in the Middle East and Africa is set to top $6bn annually by 2020.

According to management consultancy Deloitte, VR growth in the Mena (Middle East and North Africa) region is set to be driven by four main factors: increased focus by companies on delivering innovative, tailored products and services; increased pressure to reduce operational costs due to continued depression of oil prices; lower acquisition costs and greater accessibility to VR technologies and expertise; and an increased number of computer gamers and interest in VR-enabled gaming and enterprise applications.

“Early adopters of concept gaming products will continue to be the mainstay of the industry, but increasingly more products will begin to be purchased by casual gamers. VR-enabled games are delivered for PC consoles and mobile platforms, with the largest segment being PC solutions,” said Zaid Selman, assistant director transaction services at Deloitte Corporate Finance.

“VR applications delivered through smartphone and tablet devices will also continue to grow, however most are still at an early stage of development and will mostly appeal to casual gamers or technology enthusiasts.”

Investing in the virtual reality space

M R Raghu, head of research at Kuwait Financial Center, said many Gulf Cooperation Council (GCC) organisations are strategically planning to get ahead of the curve by investing in the virtual reality space. “VR has many potential uses across various sectors, beyond just gaming. Industries in the GCC are eager to adopt AR and VR technologies to streamline processes and enhance the lives of employees, students and the general population.”

Raghu added that AR/VR could be used to deliver “on-the-go information” on daily purchases, discounts and coupons, thereby offering a more refined retail experience. He said it could also be used to improve the quality of education in the region through virtual tutors.

Other uses for AR/VR in the region could include virtual hands-on training on vocational courses, such as construction, medical and military. The technology could also be used to conduct virtual surgeries on those who cannot afford to travel for medical purposes.

Shaping the way content is consumed

Martinez de Lecea agreed that the biggest AR/VR demand comes from consumer entertainment, but said other applications for tourism, education, marketing, healthcare and real estate could develop very soon.

 “AR/VR is a completely new form of communication that could dramatically shape the way recorded and real-time content is consumed,” he said. “We are just seeing the infancy in the development of the technology and its applications.”

Dubai-based entrepreneur Dany El Eid told Computer Weekly he saw a gap in the local market in 2012, prompting the foundation of his VR firm, PixelBug, which helps high-profile brands to adopt augmented reality to engage their customers. In May 2015, he launched his flagship patented AR platform Colorbug, a family-orientated app available on iOS and Android.

“We’re currently working towards implementing our AR/VR tech into the educational sector to help kids learn in a more flexible and interactive way,” said El Eid. “We particularly want to encourage learning Arabic by making it more fun and gamified. Learning Arabic is a big issue in the regional educational landscape.”

Success in VR depends on futuristic thinking and creativity

Lebanese entrepreneur Karim Saad is another local businessman who has set his sights on the regional VR market. His Dubai-based firm GigaWorks provides VR experiences, apps, tours and imagery for local businesses and the government.

The company is already competing on the international stage. “Technology nowadays is cheap and available to everyone. For me, if you really want be ahead of the competition, it’s about futuristic thinking and creativity.”

In just a decade’s time, the GCC’s virtual reality landscape is likely to look unrecognisable from today.

PixelBug’s El Eid said: “By 2027, VR tech will be part of the fabric of life and society in the same way televisions are today. It is the first observable step towards symbiosis between man and machine.

“Some people will be entirely consumed by the virtual world where they are stuck in many parallel universes, with their own niche societies and rules. AR and VR are going to eliminate the distinction between the digital world and the physical world,” he said.

Article written by Alicia Buller and published in Computer Weekly on 23 February 2017.

QFC ‘at the forefront’ of fintech discussions

The Qatar Financial Centre (QFC) Authority has hosted its first financial technology (fintech) event of 2017 in collaboration with the global strategy consultancy firm, Roland Berger.
The session, which was held at the QFC’s headquarters, attracted business and financial professionals from Qatar’s public and private sector. It aimed to identify and explain the key trends in the financial services sector and clarify how fintech is disrupting current practices and creating a completely digitalised method of banking and financing.
Kamal Naji, the QFC Authority’s chief strategy and business development officer, highlighted how fintech has transformed the financial services industry over the past few years.
He said: “Now more than ever before, the financial industry is relying on cutting-edge technology and technological innovation to provide its consumers with the highest levels of service.
“For so long, the financial industry refrained from resorting to technology as it continued using traditional methods to manage assets, provide commercial and retail loans, raise funding and transfer money. All of this is now changing across the globe.”
He added: “In the UK, reports show that the 11 leading start-ups in the robo-advice space currently manage over $15.7bn in client assets.”
During a presentation on the opportunities of digitisation and fintech for financial services companies, David Lecea, Roland Berger’s head of Banking Middle East, said: “We are now moving into a new era of fintech where collaboration of financial institutions and fintech startups will be the norm — it is exciting to see the QFC being at the forefront of such discussions.”
Peter Tavener, CFO and COO of Beehive, the GCC’s first peer-to-peer financing platform, said: “We found the event‎ very engaging and look forward to continuing the discussion of how Beehive can contribute to the nascent fintech ecosystem in Qatar. We would like to thank the QFC and Roland Berger for inviting us.”
The event concluded with a group discussion on the different methods and uses of bringing the power of fintech to bear in Qatar and how these methods would benefit and strengthen the local economy and provide additional support for SMEs. The event comes as part of the QFC’s continuous efforts to develop human capital as a driver for economic growth and prosperity in line with Qatar National Vision 2030.

Article published in Gulf Times on 7 February 2017.

Robo-advisors: wealth managers, get ready!

We are witnessing the rise of “robo-advisors”. More accurately, we should call them automated investment management solutions, since they are neither robots, nor do they provide comprehensive financial advice.

Following the disruptive appearance of FinTech startups such as Wealthfront and Betterment in the US, some of the biggest players, e.g. Vanguard and Charles Schwab, launched their own automated investment solutions. The industry is forecast to reach more than two trillion dollars under management by 2020. Other parts of the world still lag behind, but are also expected to follow this trend.

Therefore, traditional wealth managers and financial planners must get ready for the new status quo. What should they do in response to the rise of robo-advisors?

1. Accept the new reality
   Robo-advisors are receiving close scrutiny from regulators and customers, who still haven’t gone through a bear market with their money being managed by these new solutions. The automated investment model might be tweaked, regulated and transformed but it seems robo-advisors, and their low fees, are here to stay. If they haven’t developed their presence in a specific region yet, it is likely they will.
2. Consider offering your own robo-advisor
   Given the success of this model, wealth managers would do well to consider entering this market, particularly if they want to serve the retail mass affluent segment that is ideally suited for this model. Some managers ask themselves if they should offer their own automated investment management services, and if so, how? Well, developing a proprietary solution, buying one off-the-shelf or partnering with another provider are all current models that have been successfully deployed.
3. Focus on the things machines cannot do (yet)
   Not all customers’ needs can be met with an automated solution, at least not yet. If asset portfolio building and management can now be done more efficiently and less costly with an automated tool, wealth managers and financial planners will struggle to justify their fees unless they provide other services. The good news is that there are many aspects of financial planning that cannot be fully done by machines yet: budgeting, insurance, tax, trusts, succession planning and most importantly, behavioral coaching. Leaving the machines to do what they are best at, while focusing on the services humans do better sounds like the best combination to provide an excellent service.

Post originally published in Roland Berger’s blog on 7 December 2016.

Robots on The Rise. How AI Can Change the Financial World?

Why artificial intelligence (AI) might be a game changer for the financial industry.

According to Stephen Hawking, the creation of a true AI will be the most important event in human history. This process is increasingly noticeable within the technologies such as blockchain, biometrics, quantum and cloud computing, etc.Artificial intelligence (AI) is an important part of many popular technology industries – entertainment, automation, electronic gadgets and others. Recently, it has also started to increase its reach and importance in the wider banking industry and financial sectors.

Enterprises directly linked to the FX, binary options, fintech and cryptocurrencies need to confront with enlarged competition, tighter regulatory surroundings and customer requirements – solutions in the field of the artificial intelligence may become a valid response to the booming market.

Machines Better Than a Human

In recent times the saying that anything you can do, AI can do better is becoming increasingly popular. In the world of financial services it may take an entirely new meaning – though we often do not realize, AI is present all around us in many actions of daily life – natural language recognition, self-driven cars, chatbots, etc.

According to Pedro Domingos, the author of The Master Algorithm, “People worry that computers will get too smart and take over the world, but the real problem is that they’re too stupid and they’ve already taken over the world.”

Although this statement can be considered as slightly exaggerated, computers and artificial intelligence really have become and indispensable part of our lives. Still, how this may translate into the world of finance?

At what point can we trace the applications that make life easier for banks, brokerage houses, financial firms and their clients? Many examples can be specified, but let’s start from the customer support, transactions and helpdesks.

Automatic assistants like Siri or Cortana start to gain popularity not only in the daily tasks, but also in the world of finance and banking. Such products as Kasisto by SRI International, a virtual assistant in DBS digibank, secure transactions using voice recognition from Santander or Lubo prepared by RBS as retail banking helper.

All these examples and automated support systems can be directly transferred to the activities of online brokers specializing in derivatives.

Financial Analysis, Security and Fraud Detection

Although above described solutions are impressive, they are currently quite common. So how the AI was implemented on the other fields? A great example would be a startup called Kensho – supported by Google Ventures – currently it is actively used by such banking sharks like Goldman Sachs or

JPMorgan. The tool for executing automated research and financial analysis provide immediate answers to questions expressed in natural language.

Transactions security and the service stability is another challenge faced by almost each brokerage. The response to cyber-attacks was presented by PatternEx – machine learning startup that developed a system to predict, identify and counteract 85% of the most popular attacks within the financial industry.

In the field of fraud detection, the case looks really similar. Feedzai machine learning services allows to monitor all customer’s authorization, clearing and settlement systems in order to detect any abnormal action.

Artificial intelligence undoubtedly affects the transformation of various industries – the financial world is no exception here. Institution which first begin to adapt to the changes will have a potential opportunity to take over the leading position in the coming years and decades. The race has already begun and will only increase its peace.

This article is an excerpt from the latest FM Intelligence Report.

UAE telco launches mobile wallet

Etisalat signs deal with technology company to offer its customers a mobile wallet service, as fintech expands in the Middle East

UAE telco Etisalat has launched a mobile wallet to enable its customers to make payments and money transfers on their smartphones.

The company is using a platform from Oberthur Technologies. As well as account management, the mobile wallet will provide automatic reports and notifications on transactions.

Etisalat said customers’ appetite for digital payments in the UAE had driven the project. “The UAE is at the forefront of digital  payment  development, so it was critical for Etisalat to provide its subscribers with innovative m-commerce and m-banking services,” said Rashed Al Abbar, vice-president of consumer innovations at the company.

This is a sign of a trend in the Middle East similar to that seen in Europe, Asia and North America, with technology companies looking to take a slice of financial services business.

For example, mobile operator Telefonica’s German business division recently launched a mobile-based bank account, and O2 Banking is using technology from Fidor Bank as a rebranded white label service. Fidor bank, which launched in Germany in 2007, has an office in Dubai’s Silicon Oasis park.

But while these alternative financial platforms have become the norm in the world’s fintech hotspots, including parts of Asia and Europe, experts says this global trend has yet to infiltrate the Middle East.

The latest report from FinTech Week said less than 0.1% of fintech investment originates in the Middle East. “Consequently, the region’s banks and fintech startups are lagging behind their foreign counterparts in the development of new services and business models,” David Martinez de Lecea, a principal at Roland Berger, told Computer Weekly in June.

But the region is now seeing increased investment in financial services technology. Last week, Abu Dhabi Securities Exchange said it would provide access to documents on listed firms via mobile devices through a blockchain-based system, while Emirates NBD banking group announced a pilot for the use of blockchain for transactions between the UAE and India.

Article written by Karl Flinders and published in Computer Weekly on 25 October 2016.

Dubai the Center of the Middle East’s Fintech Industry

Dubai is looking to seize on the global Fintech revolution in a bid to compete with established centers like New York, London, and Singapore.

Fintech which involves using technology to provide financial services more efficiently – has grown rapidly in recent years. According to Boston Consulting Group, total funding reached $78.6 billion in 2015, up from $15.3 billion six years ago.

Both Dubai and Abu Dhabi have introduced new measures to regulate and encourage the growth the growth of Fintech startups in the region. David Martinez de Lecea, Fintech Consultant and Principal at Roland Berger says this a turning point:

“This year is interesting, 2016, it’s finally changing in terms of governments and financial institutions and most importantly, financial regulators… to allow these new businesses to foster.”

Almost 40% of the Middle East’s Fintech startups are from the U.A.E, according to MAGNiTT, a networking portal for the region’s startups, with the majority those in Dubai.

Governmental and financial institutions in the country are also looking to harness the power of Fintech companies. According to the BCG’s Fintech Database, although the North American firms accounted about 70% of absolute funding last year, Europe, the Middle East and Africa (EMEA) witnessed the most explosive growth in terms of the new funding.

Most of the biggest Fintech success stories from the MENA area have focussed on local problems. Omar Soudodi is the CEO of Dubai-based Payfort, which is a regional payment solutions firms:

“Fintech is already here today. Every market us unique. The Arab world has 80% unbanked population. You have over 5 million small and medium-sized enterprises that do not accept payment online and offline for that matter. So, people see it as a challenge. We see it as a huge opportunity.”

The Middle East’s Fintech industry and it’s potential growth was the focus points of last week’s Global Islamic Economy Summit, which took place in Dubai from 11-12th October.

Abdulla Al Awar, CEO of the Dubai Islamic Economy Development Center says that city’s support for the Fintech industry is a part of wider plan:

“The potential of Islamic economy is huge, and frankly, I think Dubai and the U.A.E. are well positioned to be at the center point. It is strategically located between economic hubs in the East and the West.”

The latest State of the Global Islamic Economy Report, produced by Thomson Reuters shows that U.A.E ranks second to Malaysia in terms of its Islamic Economy infrastructure. According to the study, the wider Islamic Economy was worth $1.9 trillion in 2015, with the Islamic Finance sector set to reach $3.5 trillion by 2021.

Article written by IndraStra Global and published in IndraStra on 19 October 2016.

Are FinTechs replacing banks?

Article written by AMEinfo Staff and published in AMEinfo on 13 October 2016.

Are FinTech firms going to replace banks in the near future? Had this been put to a banker even a few years ago, his response would have been: “How dare you ask such an insulting question?” But things have changed enormously in the past couple of years.

As Zubair Ahmed, senior vice-president, head of IT & Business Innovation at Emirates Islamic, says: “Fintechs have already done a major achievement by making bankers discuss them in this panel.” He was talking at a plenary session titled ‘The Tesla of finance is coming: are Islamic banks ready for the imminent FinTech disruption?’ at the Global Islamic Economy Forum being held in Dubai on Wednesday.

Other panellists also were certainly in agreement with Ahmed, but all of them rejected talk of an imminent disruption to traditional banking from the financial technology sector saying they are nothing more than overblown fears.

FinTechs have already made much progress and have started making money, and banks now recognise these new companies, which use technology to make financial services more efficient.

What’s next?

David Martinez de Lecea, specialist consultant, FinTech, at Roland Berger in the UAE, says collaborations are the way forward for FinTechs and banks.

Meanwhile, Ahmed says: “Increasingly, the relationship between banks and FinTech is being seen as a much more complementary and collaborative one than competitive.”

Abdul Haseeb Basit, CFO of the UK’s Innovate Finance, says banks have solutions for the major issues faced by Fintech firms, so a mutual partnership will benefit the latter the most.

“The challenge for start-ups is regulation. FinTech realises that regulation is where banks have an advantage, while they also have the ability to access a wide customer base. Banks already have that scale, so it makes sense for FinTechs to partner with them rather than market on their own.”

Abdulla Al Najran, deputy CEO, Boubyan Bank, Kuwait, is of the opinion that partnership is a two-way street. “Banks must work with FinTechs as they have ideas that the older generation will not come up with,” he says.

“Non-traditional customers are choosing to go with Shariah-compliant products and Islamic banks because of the transparency and, now, the technology. Technology and FinTech can help Islamic banks broaden their customer base,” he adds.