Bridging the Trust Gap; Migom Bank, the Neobank for Modern-day Clients
In 2021, according to Wikipedia, the world will have fifty six million millionaires, more than ever, with over 40% residing in the US. Wealth may be relative and in a historical sense challenging to measure, but without doubt, with the world population at its highest in history, the impact of wealth on lifestyle and protecting that wealth for future generations is inherently important. In the equation of wealth preservation, trust is paramount.
While many are talking about the future of remote banking and the neobanks challenging the elite of high street banking, Migom Bank has quietly established itself as a rapidly developing practical role model in the global “underbanked” markets as it connected with customers via an innovative range of regulated financial services as the basis for mutual trust. the approach appears to be working particularly well and Covid-19 has driven customers into digital adoption, which has further swelled customer numbers looking for alternative banking solutions.
The psychology of wealth is borne from the need for security, and in a capitalist economy, money is power. Having access to wealth and the ability to exchange one currency or medium of exchange for a variety of asset types is critical in the digital economy. Migom Bank’s ability to provide this service and investment in its proprietary technology makes it the only digital bank to have in your pocket, which enables you to navigate the modern, digital economy within a true one-stop shop solution.
Unsurprisingly, in the age of wealth, private banks are on the rise in developed economies, offering elevated services to clients. Migom Bank’s private banking arm offers personalized financial services for high net worth clients, to help grow wealth with the minimum of risk exposure. Migom Bank also puts a global network of safe custody and wealth management solutions at the disposal of its clients.
The emergence of new banking providers and enhanced services is not a revelation. In the wake of the financial crisis in 2008, the financial sector was vilified for its insatiable appetite for returns, exemplified by speculation and reckless conduct. The LIBOR rate scandal and Subprime mortgages will remain terms associated with the severest recession since modern times. Safety of customer deposits and a return on savings became questionable almost overnight, rocking the global economy.
In the calm after the storm, aided by digitalization, new players like Migom Bank emerged, Neobanks and Fintechs, predicated on the notion that they are a force for good, levelling an unequal playing field in favour of millennials and tech savvy consumers, many millions of whom belong to the “underbanked” class across the globe. The disruption was a good one, identifying and exploiting a service gap — an enviable outcome in any economy; expanding choice and driving growth.
Bank customers would historically have only held one currency but customer understanding, needs and expectations have changed. Migom Bank has reacted to that demand, building digital asset exchange and custody solutions to Swiss standards with their European correspondent bank. Banking with Migom underpins a modern lifestyle with custody for fiat money, as well as digital assets such as Bitcoin or exchanging fiat currencies at interbank rates as seamlessly as going from crypto to fiat in one click. With all the crypto and digital asset features tied to traditional banking and the innovative compliance and risk mitigation, that removes the need for the customer to engage with multiple vendors and dramatically reduces friction in managing one’s finances.
Trust is inherently at the forefront of the customer’s mind — millionaire or millennial, it is all relative, who to trust with money? Trust is a commodity that is not evenly distributed across banks, geographies and generations. Data tells us millennials are much more at home sharing their personal data than older generations. Engaging with digital entities with little or no physical footprint is a foreign concept to older generations weaned on the traditional high street banking model. In this respect Migom Bank can be defined as the global Neobank for the millennial or GenZ, where traditional banking has moved onto the cloud and is seamlessly integrated with the brave new world of cryptocurrencies and blockchain-based assets.
Migom Bank has successfully simplified the customer journey into crypto by removing the need for a separate fiat on-ramp, digital exchange and wallet.
By integrating these components into the digital banking model that is above all regulated, Migom Bank has a unique offering for crypto newcomers and old hands alike, removing multiple compliance friction points in a simple, yet intuitive interface. The added benefits of peace of mind against loss of funds from hacks or activities of unregulated service providers should not be underestimated. Migom Bank stands out from the Neobank crowd, with its fully regulated “Whole in One℠” offering.
In emerging markets trust remains an issue but for the most part without the historical correlation of physical structures. Corruption and hyperinflation and security in general are crucially important, yet emerging markets have their own trust story in the age of digitalization and their service gap is better defined as barriers of digital and financial inclusion. Doubtless the unbanked dilemma is a significant hurdle and equally a growth proposition in emerging markets but there are also success stories in digital adoption. In Kenya, for example, the pesa mobile currency system has proved popular, reliable and has spread to other territories. Fundamentally, many populations in these regions are digitally capable — there are more mobile phones than bank accounts, which presents the foundations for nimble Neobanks like Migom Bank, to fill the gap.
There are differences in markets. For modern economies, in the digital context, banks hold more information about their customers than any other tech giant. Spending patterns, frequently used retailers, favourite dining location and more — payment data is interwoven into the fabric of each of our lives. Compliance, embodied by KYC and AML, is interwoven into the data journey, for example, by digitally validating transactions and using multiple automated monitoring and risk mitigation systems. In emerging economies customers may not have the same protection of data history. Arrival of properly structured neobanks is expected to assist with solving that inequality. The risk of financial attack on customers’ data is expected to be mitigated by financial providers such as Migom Bank, and the subsequent impact of outcomes is anticipated to be managed by them, with regulatory guidance. At Migom Bank the policy and the focus of its technological development is to employ compliance and risk management to propagate business, serve the customer and the regulatory requirements, building trust and confidence in wealth management and other banking services with the digitally-savvy customers around the world.
In the physical world exists an unseen parallel universe, originating from unseen data centres. There is a digital divide of data. Megabytes, gigabytes and terabytes of data that bounce off satellites or flow through pipes that criss-cross our ocean floors. Packets of data contain a broad array of sensitive details — stored securely in encrypted enclaves on mobile devices and transmitted securely in SSL packets through the ether. One can only speculate at the amount of data stored by banks, petabytes, surely. All of which is used to maintain compliance in modern economies.
The absence of this data in emerging economies is perhaps the biggest barrier to financial inclusion for digital banking in emerging markets — how to tackle the challenge of compliance, with little or no historical data and less rigorous personal identity protocols deployed by host governments is a challenge that individual banks can tackle, with the right approach. Migom Bank has the solution.
Differentiated from the mainstream digital banking offering, Migom Bank has geared a customer-first approach to facilitate on-boarding in these territories.
Customers will not be rejected programmatically but will have the chance to open an account, within regulated limits, and gradually establish respective credit limits, spending patterns and other vital characteristics, which are the paramount criteria of the ongoing compliance with most of the international banking regulations. By banking with Migom Bank, customers not only gain access to Migom Bank’s “Whole in One℠” services but are also able to build a digital version of their own identity, under the protection of the Migom Bank brand.
Over time technology can be employed to gain trust. Real time analysis, behaviour patterns, IP tracking, device authentication and MFA are all valid tools of cyber security and preventative measures, but do customers understand them? In all likelihood they do not. Customers understand customer first service, not technology.
Newly emerging digital banks like Migom Bank, that can balance customer numbers over revenue will remain appealing, nimble and sustainable in an ever changing world, where technology may define the service, but not the relationship.
