With little competition and a fresh market, this may be the best time to set up an on-demand fuel delivery business, especially in a world emerging from the shadow of lockdowns and the automobile industry seeing a resurgence.   

The Building Blocks 

With the global gasoline/diesel requirements consistently outweighing the capacity of fuel stations over the years, on-demand fuel delivery is bound to be an imperative in the coming years. However, with that said, one must play their cards right at the very beginning, partnering with a reliable IT solutions provider, securing compliance from governmental authorities, and so on.   

The next step must be to build your fleet, equipped with the resources for everything from transportation to maintenance and safety. Businesses must do it with a keen eye on the reasons for the very existence of this market and the audience the firm specifically caters to. For instance, companies must hire HAZMAT (Hazardous Materials) drivers, who are elite drivers involved in the transport of flammable material. Digital Solutions that complement the fleet must also be in place simultaneously (real-time tracking systems, forward-looking camera systems, IoT sensors, collision mitigation technology, and the like).  

It is also vital at this juncture to address the towering safety concerns involved in transporting highly combustible liquids and gases over significant distances by road. The companies must immaculately monitor the transportation tanks to ensure safety; they must appropriately allocate funds to ensure this, without which the company’s existence will perennially hang by a thread.   

Only then must intrepid business owners venture into creating the on-delivery app to enable the service, though last is not the least. The usability shortcomings of the application are hurdles many entrepreneurs fail to cross, with order tracking and route management being the Achilles’ heel in these solutions. The architecture of the app backend is another crucial hallmark as end-users will use the app over data or Wi-Fi all the time. Thus, the seamless delivery operation is staked almost wholly on some key app features that demand discussion.   

Vital features of an On-Demand Fuel Delivery app: 

• Pricing charts  

The customers must get a glimpse of the savings they make through properly illustrated price charts; the introductory offers may be the bait for most customers. However, no compromise must be made on fuel quality, with double-filtered fuel as the norm.   

• Real-time tracking  

Given that the orders for fuel delivery often are in emergencies, the two-way tracking system will be equally valuable to the delivery agent and the customer while also winning the customer’s long-term trust. In addition, they can use third-party maps that show the delivery routes with ETA.   

• Accept/Reject options  

Since safety is paramount in an on-demand fuel delivery service, the fuel delivery agent must have the right to reject orders if they are inaccessible or compromise security in any manner. There must also be an option to keep charges pending until the delivery agent can make an informed decision.  

• Synced with various payment options  

      The customers should be able to make their payments over a broad range of payment methods at their convenience. They must be aware of the various situations the customers may find themselves in and be adaptable to COD, online banking, and the slew of mobile banking apps with whom they must ensure compatibility. There must be an order/transaction history so the users can keep track of their expenditure online.   

• Customer support  

The business must address the fears and misconceptions of their customers by establishing communication channels between the people and expert employees who can mitigate their doubts and create clarity over the ins and outs of the delivery protocols. Automated messages can also have a positive impact in this regard.  

blackrock recently built a digital platform for on-demand fuel delivery for a US-based early-stage enterprise. You can read the complete success story here. 

If you have an idea for a big change in the automotive world and need the right IT support to help you realize it, drop a mail to sales@blackrockdxb.com.  

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In the first six months, the global revenues for payment systems declined by an estimated 22% when compared to the same period in 2019. According to BCG, from 2019 to 2024, the global payments revenue is likely to increase by around 1% to 4%, depending on the speed of recovery from the pandemic. However, even in a best-case scenario where the rebound is quick, the expected growth rate would be half the rate of the prior 5 years. 

However, in the past six months, e-commerce, digital payments, and other online services have all registered excellent growth. The pandemic has reshaped how consumers and businesses interact with each other and this will shape the future of the payments industry. 

Here are a few of the trends that were observed during this time.

Cash to Non-cash conversion

Even countries that have been traditionally cash loyal have experienced a drop in the use of cash for transactions and have seen a rise in digital payments. For instance, the UK has seen a 50% drop in cash usage in March 2020. Payments made in-person are reducing every day, as people are being encouraged to stop handling cash to curb the transmission of the virus. In fact, most businesses encourage contactless payments, with some going so far as to not accept them at all. 

Electronic peer-to-peer and consumer-to-business payments have experienced growth during this time. Debit cards, normally associated with lower value transactions, have also exhibited growth. On the other hand, ATM transactions and cash use had experienced a decline during the same period – In India, ATM usage fell to almost 50% and a steep decline was observed in the UK as well. It was estimated that transactions executed via cash will decline by 4 to 5% during this year, which is around 4 to 5 times the annual decrease experienced during the last couple of years. 

Boost for e-commerce 

The pandemic forced a significant percent of the population to shift towards digital channels for their retail purchasing activity. Industries that depend on travel such as hospitality and tourism as well those that depend on density such as entertainment are likely to be unfortunate casualties in the short term, based on how the crisis has been progressing. However, niche segments such as fresh food, pet supplies, in-home entertainment, and so on are expected to grow at better rates. In the retail sector especially, a shift in buyer behavior was observed with customers moving from brick-and-mortar to online retail shopping. This was evident from Amazon’s second-quarter numbers that recorded a 40 % Y-O-Y boosted by the growth in grocery sales. 

This shift in consumption could also lead to a shift in the payment method used. For instance, in place of using credit/ debit cards, consumers could shift to contactless payment modes such as digital wallets or cryptocurrencies.

Move from “physical” to “virtual banking”

Banks in various parts of the world are closing branches either temporarily or permanently due to the current scenario. This has been aided by the adoption of technologies for real-time payment facilities.

In the words of Deepak Sharma, Chief Digital Officer at Kotak Banks, India – “Ninety-five percent of transactions moved out of branches post-COVID. Unless there is a great need for customers to visit branches, we don’t see it happening (again anytime soon). “

“We have also seen fast adoption of WhatsApp banking and conversational banking bots. Very soon, we will see (these changes apparent) while doing small business transactions and loan origination as well. Even after we come out of COVID, this shift in habits that we (have seen) will continue,” he added.

Cross-border payment flows severely affected

Because of lockdowns introduced by Governments, international travel came to a grinding halt causing a massive decline in international transactions. This was further worsened by waivers offered on the transaction to boost demand. Inter-regional trade had a deeper impact than intra-regional which further hurt cross-border payments, while at the same time the prices of commodities such as oil dropped since demand declined. This had a 2-fold effect on the transaction values since both the volume as well as the unit price dropped. 

To conclude, crises often create an opportunity for firms to take a good look at how they conduct business. COVID-19 is no different except for the speed at which it has managed to affect change. Payment systems have been forced to accelerate and meet the challenges raised against them. The most talented firms that adapt to the situation, leap ahead of the competition, and deliver exceptional value to customers will survive and shape the industry.

The post Digital disruptions that will shape the global payments industry appeared first on Black Rock IT Solutions – Software Product Engineering Services.

In the wake of this uncertainty, firms have been focusing on investing only in the following areas:

Operations: to ensure continued access to basic services;

Supply chain: to address emerging supplier and customer needs;

Revenue: to ensure the continued viability of the business; and

Workforce: to support employees and remote working amongst disruption.

As per a study conducted by Boston Consulting Group (BCG), around 60% of firms have paused the deployments of new IT systems, for instance, and 44% have delayed upgrades to their existing systems. A study done by Gartner shows that the banking industry, one of the largest IT spenders, is expected to cut down on their IT spending by nearly 4.7% owing to the turbulent market. They are focusing on investing in technologies that will keep their businesses running – specifically by going digital and investing in emerging technologies trying to adapt to the “new normal”.

The New Normal

The entire world is currently transforming in an attempt to adjust to the new normal – the practice of social distancing. Even though a lot of industries can work with the limitations of social distancing poses, there are many which cannot. 

Banking is one such industry. Banks build trust in very tangible ways – with retail outlets that are designed to emanate confidence and security. Older and larger banks rely on the security that comes from human contact, reassuring customers that their money is safe and in a concrete vehicle, as opposed to a mere tab in their internet browser. 

When COVID-19 struck, their business took a hit even though most banks had already enabled digital banking for their customers. This was not because the business operations affected their customers drastically, but because they needed their employees to work out of their retail outlets to process transactions. Social distancing and working from home is feasible only when employees are enabled by the infrastructure they need. This new normal meant molding a secure environment that was safe for both the employees and for customers’ transactions.

Agility and Customer Experience

Banking, insurance, and other financial services are highly customer centric. Traditionally, they have always needed the human component to provide a sense of confidence to their customers. COVID-19 has put these companies in a situation that they haven’t ever seen before. Traditional financial systems have not been very agile when it comes to change, with a large cluster of systems hosted in an on-premises environment and large IT teams supporting it for years. The pandemic showed them the importance of agility in their systems and how it can impact their overall customer experience and hence, their business too.

During the initial days of the lockdown in different geographies, many banks could not keep up with the number of customer requests pouring in, and multiple outages were reported owing to the lack of staff. This was heavily impacting their business’s reputation. Soon, their customers’ behavior changed with the new normal and the demand for digital banking was at an all-time high. This is where an agile system would be quite useful, so they can quickly and efficiently change their business operations as needed by customer behavior. 

Risks and Business Continuity

With COVID-19, every organization was faced with a pressing question – how to keep the business running? This was definitely a concern for those who were doing business with banks or other financial services companies. 

For the banks themselves, the actual challenge was to reassess their customers’ Credit Risks. With a looming NPA crisis, it was already a tough task for banks to give out loans to corporates. Their existing formulas now needed a revamp, as the variables had changed. In many countries, a moratorium was announced by Central Banks, keeping private banks devoid of any interest revenue for that time. Handling the collection process and dealing with distressed customers was the other big challenge they faced as problems caused on this front were leading to a lot of reputation risk for the organization. Robust risk management functions would be needed with the active tracking of borrowers. 

Given the circumstances; their business operating model needed rework to ensure that business continuity is maintained.

How Can Technology Help?

Technology has been a key driver of the financial services industry for ages now, with the domain spending around 10 percent of its revenue on IT expenditure. However, now is the time for these companies to use this budget wisely, as technology is going to be what saves them from bankruptcy. 

In the current situation, there is an acceleration to the digital strategy of all bank leaders. Decision-making concerning these projects has quickened and “someday” or “one day” has become “today”.

Operational costs have become much higher during the pandemic due to unconventional methods of working and handling crisis management. Organizations have had to provide facilities for everyone, including their call center employees, to work from home. Thus, technology must play a key role to provide these facilities remotely – be it secure access through a VPN, or a security system to process the transactions without fail or delay. 

Machine Learning, RPA, and other emerging technologies could be an essential component to help solve a lot of these challenges, as they reduce the dependency on humans to an extent. It could be expected that financial services companies could start to adopt Machine Learning algorithms for their credit scoring systems to make their systems more agile. Insurance companies could adopt technologies such as image processing to help underwriters in claim processing and so on. There has also been a shift to Cloud hosting from On-Premise installations, which was highly preferred by the large traditional banks, to keep all activities remote. Some banks have started turning to intelligent automation to tackle problems related to collections and debt as well.

Conclusion

Going digital is the key solution, even though that is not the ultimate goal, as human interaction is still imperative when it comes to the banking and financial services sector. However, if  you work in financial services, now is the right time to look into developing a viable Digital Transformation roadmap for your company, and ensure you have the right technologies to stay agile and customer-centric.

The ability to balance technology and the human element will define every organization’s success in the future. At Experion, we help enterprises on their digitization journeys by developing FinTech solutions that are truly future-proof.  For more information on how we can help you stay future-ready, drop a mail to sales@blackrockdxb.com 

The post How COVID-19 is redefining the financial services industry appeared first on Black Rock IT Solutions – Software Product Engineering Services.

But the recent pandemic, COVID-19,  which has the whole world reeling from the repercussions of being locked down,  has made steady paychecks with health insurance benefits look a lot more promising. And while there are advantages to being in the gig economy, there are also disadvantages that cause incredible anxiety to the workers in the ecosystem, the biggest among them, undoubtedly,  being the payment question.

According to a Global Marketplace and Gig Economy Payment Satisfaction report, a survey of gig economy freelancers from various industries around the world found that 73% of gig workers are likely to leave the marketplace due to payment issues. Many gig workers and freelancers face delayed or even denied payments, and many spend weeks tracking down payments every year. And this is where companies who rely on gig-workers can make a difference and digital transformation can be a lifesaver. One could argue that adopting a digital transformation platform to meet employees’ requirements in real-time –  an instantaneous payment platform for instance – will help the gig economy thrive going forward. 

In a move that seemed understanding of this predicament, the US Federal Reserve officially announced in August 2019 that it plans to build a real-time payment service by 2023-2024 called ‘FedNow’. Hopefully, the changes that COVID-19 has brought upon the world economy spurs them on to develop and implement this sooner rather than later. 

In the announcement, the Fed Reserve invited extensive feedback from members of the banking and payment community and in a much-publicized response, Google wrote to the US Federal Reserve Board detailing the successful example of the UPI (Unified Payment Interface) based digital payment platform in India to build FedNow. 

UPI, according to the NCPI website “is a system that powers multiple bank accounts into a single mobile application (of any participating bank), merging several banking features, seamless fund routing & merchant payments under one hood.”  It also caters to the ‘peer to peer’ collect request, which can be scheduled and paid according to your convenience. 

Google listed three major qualities of the UPI worth emulating: 

• Interoperability – account to account transfer and not just an online wallet
• Real-time money transfers
• An ‘open’ system – standards are open-source so technology companies can build their implementation of the solution

Let’s look at these qualities a bit closer and understand how they can become game-changers for the gig-economy.

Interoperability

The diverse requirements of the US FinTech industry necessitated multiple channels for enabling payments. The payment systems currently in place don’t interoperate seamlessly. Private solutions are closed-loop systems too –  real-time transfers are possible only between those users who use their specific solution. This is arguably the biggest drawback of the multitude of perfectly functional payments systems that have organically sprung up over the years.

Now imagine a new platform that can now provide you with access to the funds lying in your bank account and can transfer money from your PSP (Payment Service Provider) to another party’s bank account without worrying about the PSP the other party uses. This would essentially convert all PSPs into portals to your financial world. This is what the UPI platform accomplishes.  

Real-Time Money Transfer

As smartphones are replacing physical cards and POS systems, any new system being developed should be able to authorize a payment using a pin or two-factor authentication to transfer cash instantaneously regardless of the platform the merchant uses. Without Visa or Mastercard needing to act as intermediaries. A system that combines all the existing payment rails and can transfer money to any of the nodes seamlessly, just like UPI does.

‘Open’ System

In the current payment ecosystem, different payment rails need different types of authentication information. The new system should simplify and standardize these operations – the different types of authentication for each payment rail should be handled under the hood by the new system.  The result would be an open and interoperable payment infrastructure, compatible with all the existing technologies and has the potential to integrate newer ones. 

This is what will enable any PSP to facilitate transactions to any other PSP instantaneously, leveling the playing field for banking and non-banking PSPs (Fintech firms) when it comes to managing payments. 

The Entrepreneur’s Advantage 

The biggest beneficiaries of such an instantaneous payment platform,  other than gig workers, will be small business owners and the low fixed-income individual who has to wait for a couple of days after a paycheck is deposited for the amount to reflect in their account.

If FedNow works with this kind of an open system, it will create opportunities for small and medium-sized banks, credit unions, FinTech companies, and large retailers to develop their version of PSP applications. And while developing such a system, firms must ensure that they create a simple, intuitive platform for P2P transfers and digital POS systems for their customers. 

It will also create an opportunity for payment and ‘payment adjacent’ solutions providers to develop their own version of PSP apps. For instance, even small FinTech firms can utilize their existing infrastructure and leverage digital transformation solutions to meet customer requirements, offering innovative, secure and user-friendly solutions that can compete with the likes of larger banks.  In this way, they can reposition themselves for continued success, even post COVID-19.

Having developed FinTech solutions for their partners, companies like Black Rock IT Solutions have a distinct advantage in developing PSP apps for their client partners, that companies around the globe can rely on to be top-notch.

To know more about Experion’s Fintech offerings, drop a mail to sales@blackrockdxb.com

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