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Attempted fraud transactions increased 92% year-on-year - Industry roundup: 13 March

Deutsche Bank green loan to power Pepperl+Fuchs’s sustainable factory in Vietnam

Pepperl+Fuchs has announced the inauguration of a new sustainable manufacturing facility in Vietnam, financed with a US$15m green loan from Deutsche Bank. The loan and associated advisory services from Deutsche Bank allowed the German industrial sensor manufacturer to meet international green building standards and establish a model for seamlessly extending its global sustainability commitments to its operations in Asia. 

The facility produces industrial sensors for factory automation technologies, including sensors, signal transmission devices and printed circuit board assembly. It significantly expands the company’s production capacity in Vietnam.

The new manufacturing facility has obtained a LEED (Leadership in Energy and Environmental Design) Gold certification. LEED is a green building certification programme developed by the US Green Building Council, providing a benchmark for sustainability in real estate. Building projects earn points for addressing carbon, energy, water, waste, transportation materials, health, and indoor environment quality to achieve corresponding levels of certification; gold certification is the second highest level.

Commenting on the news, Andreas Bouche, Executive Vice President Global Finance, Pepperl+Fuchs, said: “We are proud to begin our ESG financing journey in Asia Pacific. Four of the eight countries globally where we operate manufacturing facilities are in this region, and the opportunity to help set a strong standard for responsible manufacturing in these developing economies is great. Deutsche Bank has been a reliable partner in this journey; we are glad to have benefitted from their valuable advice and practical ESG expertise in Asia Pacific.”

Kamran Khan, the bank’s Head of ESG for Asia Pacific, added: “This transaction exemplifies Deutsche Bank’s Global Hausbank strategy – we are committed to helping our clients in all regions and on all products, including support to companies like Pepperl+Fuchs in meeting their global sustainability standards in APAC.”


Finastra ESG Service aims to help banks deliver sustainable lending to corporates

Finastra has announced the availability of its ESG Service, a cloud-native SaaS solution that streamlines sustainability-linked lending. The solution is designed to facilitate the integration of sustainability performance target criteria into ESG pricing for Finastra Loan IQ and other back-office systems in the market.

Sustainability-linked loans use complex pricing structures with multiple moving parts that need to be tracked against the sustainability targets outlined in the credit agreement. This can tie up resources, limit banks’ scope in ESG product offerings, and introduce risks associated with manual processes. An automated solution for managing the KPIs and ESG pricing changes of sustainability-linked loans enables banks to grow these lending portfolios efficiently and minimises the risks tied to manual processes.

Transaction volumes for sustainability-linked loans have increased considerably in recent years due to a broader push towards ESG-focused financing. Following a record volume of ESG financing totalling $1.6 trillion in 2021, sustainable loan volumes held up in 2022 despite the challenging macroeconomic environment that saw reduced capital markets activity across asset classes.

“A shift in the mindset of corporate stakeholders, investors, customers and employees is pushing banks to adopt a more sustainable business model and this is driving demand for sustainability-linked loans,” explained Simon Thorogood, Senior Director, Corporate and Syndicated Lending, Finastra. “This creates a huge opportunity for banks to grow revenues and become leaders in the space, with borrowers looking for banks to help shepherd them through their ESG journey.” 

With complex and constantly-evolving ESG regulations on the horizon, having a centralised store of data should aid banks in efficiently and accurately meeting their regulatory obligations and relevant disclosure requirements.

ESG Service is designed to support sustainability-linked loan pricing. As a cloud-native SaaS solution that uses open APIs, it provides flexibility to support varied deal structures and offers extensibility for including new capabilities and partner applications. It also has the scope to add additional pricing components beyond interest and ongoing fees and the ability to support multiple transaction processing systems that require loan pricing adjustments.

By providing an automated means for tracking ESG performance and the related margin changes – which can be consumed directly in the relevant servicing systems via APIs – the service aims to deliver benefits to users across the middle and back office, including credit managers, borrowers and sustainability coordinators.


BILL and BMO partner to support digital and streamlined business payments

BILL and BMO have partnered to digitise and streamline business payments through BMO Bill Connect, a bill pay and invoicing platform. The cloud-based platform aims to give users more visibility and control over their financial operations. It offers end-to-end accounts payable and accounts receivable services and is specifically developed to work with accounting software such as QuickBooks and Xero. 

The solution is designed to streamline the accounts payable process, enable electronic payments, and improve the accounts receivable process by offering invoice and payment tracking capabilities and the ability to accept payments.

Using BMO Bill Connect, SMEs should be able to get paid and pay bills faster by automating payments, digitising invoices and eliminating cheque writing, signing, stuffing envelopes and mailing. Users could also reduce time spent in data entry tracking by collecting and compiling information through effective reporting and complete audit trails that sync with leading accounting software.

The solution also offers a single dashboard to enable businesses to manage cash flow better and view all incoming and outgoing payments. With access to one central record, companies can manage all payments and invoices electronically in one place at any time from any device.

BMO Bill Connect also aims to help users reduce fraud risk, improve transparency into the status of physical cheques paid through the platform, and automatically get Positive Pay Protection. Businesses can also assign user-specific roles and permissions and route bills, providing full control over the end-to-end process.

“[Through this partnership] with BILL, we are making it easier and more convenient for our customers to manage their businesses,” commented Niamh Kristufek, U.S. Head of Business Banking at BMO. “By embedding the platform directly within the BMO Digital Banking experience, customers have a safe, convenient, and centralised solution for cash flow management.”


J.P. Morgan payments solution fuelling Volvo’s first electric car in India

In line with its ambitions to become an electric-only brand by 2030, Swedish luxury automaker Volvo Cars have rolled out the XC40 Recharge in India – the first fully electric car made available to customers in the country exclusively via a new direct-to-consumer model that is powered by J.P. Morgan’s online payment gateway.

Fully integrated into the auto manufacturer’s website, J.P. Morgan’s payments solution enables Volvo’s customers to select, customise and make down payments for their online car bookings through a wide range of digital payment methods. The outstanding balance is then facilitated through electronic fund transfers – ensuring an easy and seamless end-to-end online car purchase experience for customers.

In addition to the bank’s merchant services proposition, the underlying flow leverages J.P. Morgan’s virtual reference (VRN) solution, wherein each customer is assigned a unique VRN linked to their purchase order number, allowing for payments to be made synchronously both via the online payment gateway and electronic fund transfers - which are then seamlessly collected and reconciled.

Nitin Agarwal, CFO, Volvo Cars India, noted: “J.P. Morgan’s efficient and coordinated implementation approach with our teams at Volvo ensured that the payments solution was not only seamlessly integrated into our platform, but also met the aggressive timelines to align with our electric car rollout, while assuring us of a smooth end-to-end user experience for our customers.” 

For Volvo, the automated solution further delivers value-add in the form of detailed reporting that provides insights into customer behaviours, and reduces counterparty risk by working with a single global banking provider.

This news comes as the Reserve Bank of India recently announced a campaign to get all Indian citizens using electronic payments.


Carrefour Italia and Nexi look to boost digital payments at the checkout

Carrefour Italia and Nexi have announced a partnership that enables consumers to pay postal payment slips and PagoPA notices at the checkouts of more than 190 stores in Italy, including Carrefour hypermarkets and Carrefour Markets. PagoPA is an electronic payments system for transactions made to Italian public administration entities.

The service, created in collaboration with Poste Italiane, enables payment to be made using any method. Based on Nexi's technology platform, this solution allows Carrefour to manage, with one integration, the interface of the checkout system with the PagoPA node and with Poste Italiane's systems. This allows them to simultaneously enable the collection of both postal payment slips and PagoPA notices.

The service, which is available during all store opening hours, enables barcode reading of payment slips and QR code reading of PagoPA notices, allowing for checkout payment of bills, utilities, taxes, fines, school services and other payments to public administration bodies, with the assurance of a reliable and secure payment experience.

“This agreement with Carrefour Italia allows us to continue to support the modernisation of the country, contributing to the further spread of digital payments, specifically towards public administration,” said Andrea Pennacchia, Head of Banking & PA Solutions at Nexi. “This partnership also allows us to take another step in the digitalisation of points of sale, while guaranteeing large-scale retail trade the opportunity to expand the range of services they offer their customers without increasing complexity at the checkout.” 


Attempted fraud transactions increased 92% year-on-year, survey finds

The 2023 NICE Actimize Fraud Insights Report shows that the rise of banking fraud is a growing concern for financial institutions (FIs) and consumers alike. Fraudsters are becoming increasingly sophisticated, shifting their tactics from traditional account takeover and unauthorised fraud to more complex authorised payments fraud (scams). This complicates the fraud threat landscape and puts FIs at risk of double loss scenarios - both first-party and third-party victims. 

The report indicated that from 2021 to 2022, attempted fraud transactions skyrocketed by 92%, and attempted fraud amounts soared by 146%. This alarming trend highlights two key points: first, there is a dramatic increase in overall transaction volumes and second, fraudsters are becoming bolder and targeting higher fraud amounts. 

The report also stated that fraud is not limited to one specific channel; it’s a complex, multi-channel threat shaped by digital transformation, changing consumer behaviours and shifting fraud patterns. The report also estimated that the absolute amount of attempted authorised payments fraud overtook account takeover fraud amounts, with a 45.9% year-over-year increase from 2021 to 2022.

“Fraudsters are leveraging faster payments innovation to conduct sophisticated scams involving money mules who transfer funds away from the FI - funds that are often unrecoverable,” said Craig Costigan, CEO, NICE Actimize, “As the digital landscape evolves, so do fraudsters’ tactics. The threats identified in our report are a glaring reminder of the ever-present risk that looms over digital channels and payments. Financial institutions must fortify their defences, and review digital channel controls, to stay ahead of new and emerging threats.” 

As the world moves towards a cashless society, the volume of transactions is increasing. So, too, is the amount of fraud across all channels and typologies, including online, mobile, and in-person transactions. NICE Actimize's research sheds light on this pressing issue. It highlights the need for layering in cutting-edge technologies like machine learning (ML) and artificial intelligence (AI) to identify even the most sophisticated fraud schemes.   

The report also indicated that money mule-related fraud is a leading challenge facing financial institutions. Money mules are critical in authorised payments fraud and scams, new account fraud, and moving illicitly obtained funds. The report explains that, while mules don’t generate direct loss at an FI, they impact revenue because these accounts aren’t profitable, are costly to acquire and maintain, and expose FIs to regulatory scrutiny and reputational damage.   

The report showed that 59% of new account fraud is mule related. Most of these accounts demonstrate mule characteristics within 30 days, indicating that fraud is being conducted almost instantly. Money is typically moved in a mule network within two hours before it is completely gone, exiting the account within 12 hours. 

Using anonymised data, insights for this report were secured across online and offline payments channels, including P2P, ACH, wires, checks, and card transactions. Using NICE Actimize’s X-Sight AI, which uses collective intelligence and federated learning to spot emerging threats and suspicious activity patterns, the report was created by analysing billions of banking and payments transactions representing over US$110 trillion in value. 


Cambridge stakes claim as best UK city outside London for finance graduates

According to new research from UK financial services provider CMC Markets, Cambridge has the most entry-level finance job openings per capita in the UK, even more than London, The study analysed data from major job search sites, Indeed and Linkedin, and collated cost-of-living data from Numbeo for these cities.

Cambridge came out top for finance graduates, with 13.5 jobs per 100,000 people. The city with the second most entry-level finance roles outside of London is Oxford, with 5.6 jobs for every 100,000 people. It is, however, worth noting that Cambridge has the highest cost of living on the list, with the average monthly cost of living for one person coming to £1,765.23, including rent for an apartment outside the city centre. Oxford has the third highest cost of living, with monthly expenses for one person, including rent averaging £1,661.88. 

Norwich comes in third on the list with 5.4 entry-level finance jobs per 100,000 people and a monthly average cost of living of £1,366.65. Birmingham ranks fourth, with 3.2 finance vacancies for every 100,000 people. Birmingham, however, has the lowest cost of living on the list, with a monthly average cost of £1,269.89, including rent for an apartment outside the city centre.

Bristol has the fifth highest entry-level finance jobs per capita, with 2.9 jobs per 100,000 people and monthly living costs averaging £1,605.90 for one person. Brighton has 2.7 jobs for every 100,000 people and ranks sixth on the list. Coventry has the seventh most entry-level finance jobs per capita, with 2.5 jobs per 100,000 people. It is also the second most affordable city on the list, with the average monthly living costs for one person coming to £1,278.37.

Leicester is eighth on the list, and Edinburgh, the only city outside England on the list, has the ninth most entry-level finance jobs per capita, with 2.4 jobs per 100,000 people. The 10th city on this list is Leeds; it is also the third most affordable city on the list, with average monthly costs of £1,330.16 for one person.

People determined to have the London experience will find no shortage of opportunities, with 7.2 entry-level finance jobs per 100,000 people. Of course, they must consider the high cost of living at £2,347.92, including rent for a one-bedroom flat outside central London.

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