Without external expertise It is difficult for banks to respond to new technology challenges. At the same time, credit institutions, like no one other, understand their business. Here is the why partnership and correct division of roles between bank and integrator is the most important. Director for development and implementation of software in Jet InfoSystems Vladimir MOLODYH told NBJ about trends in banking IT and examples of effective business-oriented interaction of the bank and the integrator.

NBJ: Jet InfoSystems works a lot with banks. What are the trends in technological development of financial organizations today?

V. MOLODYH: The main trend is an effort to move from mass solutions to individual, either for rules of client service,  products and services creation algorithms,  , work with own staff or information security policy. This approach can be realized only by using automation and high-level IT solutions. These are, in particular, the systems allowing to form personalized offers for each client, and security solutions in which machine is capable to sort each incident individually. 

I will emphasize, automation today means delegation to system not only such processes as document flow, coordination, accumulation and structuring data as was earlier, but also decision-making processes, providing of expert opinions and individual programs for clients. For this purpose it is necessary to work with a huge number of various data from various sources – both internal, and external (from traditional credit bureaus, black lists and bases of invalid passports to social networks, website monitoring systems, etc.). 

The more sources, the more it is difficult to analyze information – and here not to do without technologies of artificial intelligence any more. Expert systems will inevitably develop in the direction of machine learning and predictive analytics. Thus, the key trend regarding business applications is that  data volumes will grow in them, and machines will be engaged in preparation and implementation of individual decisions and strategies.

NBJ: Considering serious competitive fight in the banking sector which organizations, in your opinion, will appear in more advantageous situation?

V. MOLODYH: Will win those banks which competently apply individual approach and faster involve such valuable capital as client data. For example, many banks have credit conveyors using modern scoring models, nevertheless the problem of a non-return of the credits remains. It is possible to reach much higher results, having connected a large number data sources – it will allow to reveal a huge number of hidden regularities. For example, machine is capable to find some risk factors, analyzing the client's profile in social networks: its records, friends list, subscriptions, etc.

NBJ: High-quality automation - what short definition of this concept would you offer?

V. MOLODYH: At the business level – it is individual work, but made for a huge number of consumers. At the level of IT – it is work with possible ways given and the increasing delegation of a substantial part of this work to machine.

NBJ: What role do you think the external IT expertise plays for a modern bank?

V. MOLODYH: Now the market undergoes serious changes: banks reserve expertise on steadily working systems, and scales of similar practice will grow. The logic of banks is quite clear: it reduces their risks and expenses which arise during the work with the integrator. In this direction IT company would be attracted in an outstaffing format. 

However bank isn't able to be an expert in all latest technologies which constantly come to the market. It is too expensive. Moreover, employee of an integrator, for example a highly professional architect, has any extensive experience of experiments which no bank could handle. In particular, our company gives more and more attention to research and development (R&D) every year.

NBJ: What are the practical results of your research?

V. MOLODYH: Among recent glaring examples – creation of own system of counteraction to fraud  Jet Detective which is based on  machine learning  technologies with elements of artificial intelligence. We have applied our expertise in the field of information security and software development to make antifraud quicker, more powerful and cheaper, and the work with such system –  more convenient, quick and simple.
Jet Detective applies both the general expert rules of analysis, and methods of machine learning that help to prevent not only the known types of fraud, but also new schemes. Besides, the solution is capable to reveal the preparing plunders and difficult cases of fraud when illegal actions are made by different persons, in different systems and at different times.
Several pilot implementations in financial and industrial sectors are already fulfilled.

NBJ: What other trends, maybe not such fundamental, but topical at the moment you can note?

V. MOLODYH: First, we see the obvious growth of popularity of co-branded projects with cards of loyalty. It means integration of client data bases of banks and retailers, and also preparation of the individual offer for the client. We, in particular, have realized such complex project for the LIKARD company where co-branding of fuel and cash cards has been carried out.

Secondly – development of services of virtual network operators (MVNO). It will allow banks to expand a line of services and to make them more individualized, and also to accumulate more fully financial flows of clients. As an integrator, we are ready to help with technical realization of such projects for, on the one hand, we have powerful expertise in construction of telecom systems, and on the another – 
deep  understanding of bank specific. Moreover, we already have successful experience in starting MVNO in bank.

NBJ: Aspiration of banks to the newest technologies does not cancel a huge layer of current IT tasks. What is the role of the integrator?

V. MOLODYH: As I already spoke, the farther, the more banks will solve the regular problems by own forces. The integrator is necessary to carry out high-quality changes in IT – for example, serious transformation of an IT landscape. Cases when owing to "historical" reasons (including mergers and acquisitions) the application-oriented environment of bank becomes similar to a scrappy blanket are frequent and needs integration. We solved the similar problem not so long ago in Bank URALSIB where just in two months we carried out merge of two CRM systems to one. Integration is realized not only at the data level , but also at the level of business processes. The challenge of the project was that it was necessary to provide a business continuity in course of migration, to execute the project in a short time and to make it without serious consequences for the organization and its clients. It is unlikely the bank would cope with this task alone.

Not to do without skilled partner in case it is necessary to rebuild banking IT on a modern basis. Rather typical history: business asks to start new service urgently, and the IT division needs several months just to develop and some more months for productive start. It is obvious that basic changes are necessary. As an integrator we can provide them, and teach the banking IT infrastructure to work in a new format.

We have realized such consulting project in the National Payment Card System. Working in the territory of the customer, our experts while testing have built processes of continuous integration and continuous delivery of software. That is we automated as much as possible all stages of development and implementation: for example, testing that previously required 100 man-days, we now carry out in 1,5 hours. Such approach helped to reduce significantly time-to-market, number of mistakes and the cost of development process in general. Especially important is that we have prepared and trained the internal testing team which is able to work further without our participation.

I would emphasize that an integrator has to work on such algorithm: when there are some new decisions or technologies, he comes to bank or other organization and helps to start process which in future the client will be able to conduct and control on his own.

NBJ: Which IT solutions are in the greatest demand among banks?

V. MOLODYH: Those which allow to reduce IT costs, but not at the expense of necessary functionality. After crisis of 2014 banks began to count money more scrupulously that, in particular, increased the demand for Open Source software. On open platform basis some banks are developing their own systems, others use services of contractors, and the third buy finished inexpensive Open Source products. Within the direction we developed Jet CRM –Customer Relationship Management System based on free solution Sugar CRM. Some successful implementations of Jet CRM were already carried out in banks. On the functional coverage Jet CRM is not inferior than expensive analogs because it concentrates all our expertise with banking in Russia. At the same time the solution allows customers to save on licenses.