Tech Bytes - Daily Digest: October 31, 2016
Algorithms built on digital footprints will revolutionize lending, Will the fourth industrial revolution have a human heart, Why big data leaders must worry about IoT security, 5 mistakes to avoid when building the business case for IT, Financial sector urged to strengthen governance and more.
Fintech will also be very influential in the area of payment banks. One of the reasons for the slow growth of bank lending is that there are very few banks that have licenses. The deposit rate and lending rate is quite high so there’s a lot of sticky money in the economy. Until now, there was no competitive dynamics that upset the apple cart. Now with the emergence of fintech firms on the credit side and the rise of payment banks on the deposit side, the established banks will face pressure on the credit and deposit side. This will also mean that the customer will benefit both ways, from a higher deposit rate and with lower interest rates on loans and at the same time with better access to both. So, fintech will change the nature of existing businesses in areas of transaction, credit, and deposits.
In many startups, centralized authentication is a "future us" problem. Setting up centralized auth is useful for managing your network, but requires time, domain knowledge, and patience to get many of the technical solutions working. Compare this with the ease of user management via configuration management (CM) tools that your DevOps teams are already using — they work well enough (and did we mention that they're already in place?) — so it makes total sense that many organizations "punt" on this issue. However, once your organization grows to a certain size, managing users through CM can be a hassle. For one thing, not all systems are going to rely on UNIX authentication (such as Jenkins, Grafana, etc.), so you’ll need to start configuring those separately and possibly outside of your CM platform.
In this new industrial revolution, it is believed that robots and humans could be living and working together a lot more. This raises questions of trust. A good example is if a person is faced with an illness and a robot and human doctor prescribe different drugs and care strategies to get well. It would be hard to know who to trust. Another great example provided is if you were arrested for a crime that you didn’t commit, would you rather get tried by a robot or a human judge. These are questions we may face and sooner than you think. In fact, in some cases it is already happening. Some believe that there could end up being conflict between people and robots. This could have two potential outcomes. One would be and economic struggle where humanity is destroyed at its core.
"To ensure that enough time is available to work through the important details of this remedy, particularly those that ensure that customers’ data is secure at all times, we are requiring that the release of information under this remedy takes place in stages," Smith said. "The least sensitive information – for example about banks’ prices, terms and conditions and branch location – will be made available by the end of March 2017. We expect that all aspects of an open banking standard will be up and running in early 2018 to coincide with the implementation of the second Payment Systems Directive (PSD2)." Smith described the CMA's open banking plans as "the most fundamental" of its remedies from its market review and said open APIs have the potential to "transform the financial services sector".
Here’s a simplistic breakdown: a neural network consists of several layers of neurons. Inputs are passed into the first layer. Individual neurons receive the inputs, give each of them a weightage, and produce an output based on the weightages. The outputs from the first layer are then passed into the second layer to be processed, and so on. The final output is produced. Then the magic happens. Whoever runs the network defines what the “correct” final output should be. Each time data is passed through the network, the end result is compared with the “correct” one, and tweaks are made to the weightages until it creates the correct final output each time. The network, in effect, trains itself. This artificial brain can learn how to identify chairs from photos, for example. Over time, it’ll learn what the characteristics of chairs are, and increase its probability of identifying them.
One problem facing companies that use or are planning to use IoT with their big data plans is that there currently is no consensus on how to implement security in IoT on a device. This lack of consensus is an issue for standards committees to resolve, not for corporate IT to address. So what do you do if your company is using or planning to use IoT? Follow these steps. First, identify all of your IoT exposure points for hacks and breaches, and write and enact a plan for regularly monitoring them. This monitoring should occur at two levels: regular physical inspections of devices and continuous software-based monitoring and logging of emissions from these devices that are conducted by a network-based system. If unusual activity from a device is detected at any time, there should a way to immediately shut down that device.
Now, more than ever before, companies are looking closely at the impact of IT spending on their bottom line. Economic pressures, coupled with years of heavy IT spending without clear returns, have driven corporate demands for a tighter rein on IT expenditures and clear justification of every dollar being spent. Technology and finance decision makers need metrics and measures they can trust to ensure that they are making IT decisions that will have a positive impact on the corporate bottom line. Although the buzzwords may have changed and the expectations for payback and risk have become more precise, the path to a credible business case hasn’t changed. Building a business case for a tech investment isn’t difficult, it’s just structured: identify the top areas of benefit, quantify the costs and benefits, and calculate the metrics.
According to Rwangombwa, banks can promote corporate governance by harnessing the relationship between management, shareholders and other stakeholders. He added that the structures through which a firm’s objectives are set, and the means of attaining those goals, and constant performance monitoring play a critical role in strengthening governance. “It is, therefore, important to ensure timely and accurate disclosure on all matters, including your financial health, performance, ownership and governance,” he said. He argued that financial institutions are unique and should uphold public trust to succeed. Rwangombwa noted that the concept of corporate governance is relatively new, adding that even some directors do not understand the ‘heavy’ responsibilities of a director.
Visa and Chain’s system represents a brand new effort to challenge the Swift electronic messaging network because the dominant methodology for moving giant sums of cash across borders between banks on behalf of companies. Swift has been the topic of recent high-profile hacks and is beneath intensive restrictive scrutiny. But cross-border payments ar still a moneymaking business for banks. Visa, that is attempting to become a a lot of relevant different within the space, are providing the merchandise beginning next year to its member banks as a tool to supply their business customers. The California-based network operator is best famed for facultative personal line of credit and debit cards.
As an Enterprise Architect working in the IT Management, you have the heavy task of aligning between different organisational silos as well as architectural framework, and industry standards and best practises. Whilst each existing framework and standard has its own intended points of focus, they all share the same restrictive principle i.e. they take a “toolbox” approach where the more content you have in your framework, the more value you provide to the architecture practitioners – but only in and of the particular framework and do not take into account the need to provide insight into how they connect to the broader environment. It is therefore difficult for practitioners to implement the frameworks, understand how to integrate between multiple frameworks or what to prioritize for the benefit of the organisation.
Quote for the day:
"If someone likes your idea the first time you explain it, your idea isn't risky enough." -- Nicolas Cole