World Finance: David, you said in the latest issue of World Finance that interest rate increases are the most significant trend affecting liquidity today – could you tell me more about that.
David Barrett:Yeah, I think in a year where we’ve had an awful lot going on: AI has been a predominant headline, if you look at what’s gone on in crypto, you look at what’s gone on in world markets in general – you know, the US had three bank failures in March. There’s been a lot going on, but I think the predominant driver and influencer on all of those things has been US rates.
We’ve had a significant increase over the last 12 months, and even last night we had another increase from the Fed, although many people think that that’s probably enough. Rates have influenced and dominated the movement in pretty much every corner of the market, I think.
World Finance: We’ve had a decade of near-zero rates – what kind of behaviours became normal in this incredibly long period of time?
David Barrett:Yeah, it was a long period of time! And I think if you look at why it came about, it was perfectly justified. I think the authorities at the time of the crash in 2007-8 – I actually think they did a fantastic job!
I worked at an institution that was in the middle of that, and it was clear to all of us there just how poor the conditions in the market were. But I think it went on for too long. The biggest problem the world has had is that it’s decided that low rates are the new normal and it would carry on forever – and that’s clearly not true!
I mean, rates now aren’t high. Rates are more like what we would consider an average over the past few decades. But compared to where a lot of industry has grown up in the last 10 or 15 years and has really developed and survived in an environment of low rates, it’s come as a very big shock.
World Finance: So it’s not really that we’re entering a new normal – we’re entering the old normal again.
David Barrett: Yeah, I think it depends on who you ask. If you ask me, this is normal! Where we are now is much more like the normal that I could express as normal. I don’t think having artificially supressed interest rates is a normal environment.
I think it’s politically expedient! But it’s just not justifiable. And when you get something like inflation come along, lower rates create a huge problem, and solving them, you have a pretty blunt toolbox.
You know, higher rates will work against inflation, it will solve it. Being a blunt tool it tends to break a few eggs as it’s going along, and we’re seeing that now.
The consumer has been hit, but not perhaps as hard as you would think.
You know, always it’s the lower end of the economic stack that gets hurt most. And if you look at the way that inflation has taken hold and you look at the things that are being affected by it, consumer confidence is only one of those things.
I personally don’t think inflation will go away quickly – if anything I think we’re actually clueing ourselves up to maybe a second round of inflation. And that would be very damaging for markets, because they’re already trying to call a top on interest rates, they’re already predicting that the Fed’s going to start cutting at some point.
I personally am in the higher for longer and beware if we get more, camp.
The causes of inflation this time are different, and I think that the solutions and the time it takes to get rid of it is going to be a lot harder than people want it to be.
The reality is that we’ve had it incredibly easy for a long while, and it’s not as easy. And I think part of the problem for people in general is accepting that things have changed – particularly if they change for the worse, and not for the better.
When COVID hit the Philippines, the islands shut down. The country instituted one of the world’s longest and strictest lockdowns, resulting in a GDP contraction of 9.6 percent in 2020. But for Standard Insurance it was – uncomfortably – one of their most profitable years. Patricia Chilip, chairman and CEO of Standard Insurance, explains how the company has been performing since the country reopened, how Standard is channelling that growth back into the local community, and how it is leveraging technology to be there for its customers through difficult times for another 65 years.
Patricia Chilip:I don’t think anyone was ready for COVID. Nobody knew what was going to happen the next year, or the next day. Our first response was really to make sure that the employees were okay, make sure that everyone wasn’t sick, or if they were to get them to the hospitals.
But actually, my brother, who was running the company at that time, had a year before put all the systems on the cloud. Which meant we could issue policies, and deal with claims. So in that sense, we were actually ready.
World Finance: When COVID hit the Philippines, the islands shut down. The country instituted one of the world’s longest and strictest lockdowns – meaning that in 2020, the Philippines’ GDP contracted 9.6 percent. Nobody was going anywhere or doing anything – so for the non-life insurance sector, sales plummeted – but so did claims. For Standard Insurance, it was – uncomfortably – one of their most profitable years. I met with Chairman and CEO Patricia Chilip to find out how the company has been performing since the country re-opened.
Patricia Chilip:From 2022 we’ve been seeing like double digit growth, 15 percent, sometimes 20 percent. You know, there’s like pent-up demand because nobody bought anything during COVID. So now like, people are buying new cars, and people are travelling again because they haven’t travelled in two years. So it’s a surge of growth, and we’re using technology to keep up with it.
What’s exciting for us now is all the AI. We’ve been using that for our claims. We’re using chatbots to be able to answer frequently asked questions, ocular character recognition to be able to read receipts,. As well as doing some things for our value based adjudication of our claims.
Customers also engage with us now through fintech. So, we meet them digitally and we like to be present in all those platforms, whether it’s through fintech payment systems or online banking – we try to be at every touchpoint.
World Finance: When you’re seeing the kinds of success you’ve described, how important is it that you put some of that growth back into the community?
Patricia Chilip:Well it’s very important to us, you know. We are a Filipino company, and our customers are Filipino, and we want to give back to the Philippines.
We have a lot of advocacies. Our group chairman, my father, is a big supporter of the Philippine coastguard. We’ve donated speedboats to be able to patrol the Manila Bay, as well as make sure that the coast is clean.
We support a lot of scholars, young violinists. We make sure that they are educated in the best schools, like Giuliard, or in Vienna.
We’ve also supported nutrition for children and mothers. We’ve supported kindergartens for kids from three to five – that’s my favourite one, because that’s really when the brains of the kids are sponges, so we partner with MoveEd, and they teach as well as feed the kids at the schools.
For me personally because I care about the environment, I love that we planted 12,000 trees for our 60th, and we hope to plant more now that we’re 65. You know, you plant a tree… it’ll benefit the generation after us. So that’s what’s important for me. But everything we do is really for the development of the Philippines.
One of the values of Standard Insurance is really a passion for excellence. So all our advocacies make sure that the community has what they need to be able to have that passion, so you have to have the right nutrition, the right education, the right avenues, if you want to grow and excel. So that is really our passion, to bring Philippine excellence to the world.
World Finance: Finally, 2023 marks Standard Insurance’s 65th anniversary – how are you working to ensure that the company enjoys another successful 65 years?
Patricia Chilip:I’m happy to be here. Helming a company that has been of service to the Filipino for 65 years. And I’m just grateful for the officers and for the employees who have taken us this far. Really they are the heart and soul of this company.
Our people really have a compassion to help, you know. It’s tireless service. every day they wake up, Respond to claims, respond to clients in need. They make sure our systems are all working. And now it’s 24 hours, I mean service is 24 hours. So they really are there for you, they’ll pick up your call when you’re like stuck in Madrid, or you’ve freaking had a heart attack, we will pick up the phone and take care of you. Really somebody got hit by a bus in Italy, and I swear this team didn’t sleep for like two weeks, to make sure that she came back to Manila okay. So that’s really how we do it.
It’s our life purpose to really be there for you when we’re needed. we’re here in difficult times, whether it’s typhoons, catastrophes, or whether you had a medical emergency abroad, I’m proud to be working with employees who will pick up the phone at any time at night to help a customer in need. And if we keep doing this for 65 years then, then our company will evolve and change and still be a relevant one that responds to all the customers needs.
‘The Philippines gets about 18-24 typhoons a year. We sit at the Pacific ring of fire, so we also have earthquakes. We have flooding. And with climate change, they’re more and more frequent,’ says Patricia Chilip, chairman and CEO of Standard Insurance, one of the Philippines’ leading non-life insurance companies. She explains how the business manages all that built-in risk, balancing customer needs with shareholder expectations, and how the company is working to become one of the world’s top 10 general insurers.
Patricia Chilip:The Philippines gets about 18-24 typhoons a year. We sit at the Pacific ring of fire, so we also have earthquakes. We have flooding. And with climate change, they’re more and more frequent.
On the ground that feels like a lot of, sort of, distress, when the event happens. You know, life can come to a standstill.
It happens every year, so, we’re kind of used to it. But you just want to be able to sleep at night knowing that someone’s got your back.
It’s really our life purpose to be there for them, when they need us the most.
World Finance: Patricia Chilip is Chairman and CEO of Standard Insurance – a leading general insurance company in the Philippines, with a mission to bring peace of mind to all mankind. But what does that mean in practice?
Patricia Chilip:Peace of mind for all mankind is really our hope for everybody, what we wish for everyone: happiness, a sense of contentment, a sense of security. We really want to make sure that our clients can sleep well at night knowing that their assets are covered properly, that they have what they need. That’s what we hope for everyone.
Our job is really to be on the ground, to answer those calls when they need us. We have branches in 65 provinces nationwide, so we have somebody on the ground to help you tow your car, or help you assess your damages, or just pick up the phone and answer all your questions. Because we want them to sleep well at night knowing that they’re covered with us.
One of the challenges we face is that when an event does hit, they realise they haven’t updated their values in 10 years. Even three years ago – you know, after COVID, construction costs have gone up 30 percent, 40 percent.
So it’s so important to update your values, because if you haven’t updated your values then it’s going to be a struggle when you make a claim. Because even if you get totally paid out, you’re like: oh, it’s not enough to reconstruct my house.
That’s our campaign for 2023, to make sure that our clients have updated their values that their property’s insured for, so that when a big event hits, they’re really covered properly.
World Finance: That must be incredibly challenging as a business – taking on and managing all that risk.
Patricia Chilip:Well you know we have a really good team of underwriters. We also have all the technology behind us – we have a catastrophe risk monitoring system, a CRMS, which, you know, you can plot a GPS point and it gives you whether a place is high risk for a typhoon or flood or earthquake, and it helps us advise our clients as well, in terms of how to rebuild or mitigate their risk.
Of course we have excellent reinsurers. We have a couple of decades of relationship with them, and they know our underwriting, and they always respond so quickly. We have some of the best ones in the world. So, that kind of helps us respond to Philippine cat.
World Finance: So how do you find that balance between your customers’ needs and your shareholders’ expectations? How do you grow a successful, sustainable business?
Patricia Chilip:Well, we grow organically with our partners. We’re happy to be partners with the biggest banks in the Philippines, and the biggest automotive companies in the Philippines. And because we share a customer base, if they grow we grow.
So we’re grateful that people have approached us for partnerships, like travel regionally, pet health globally, and now we have a new partnership for automotive collision in the US. So we’re very excited about all these like, global initiatives.
You know, we find that if we put one foot in front of the other then things will take care of themselves. We do our best every day, and we find that if we do a small job well, bigger jobs come.
People in the Philippines are big on social media, so if you do a good job everyone knows. And if you do a bad job everyone knows as well. So it keeps us on our toes. And it aligns our customer expectations with our shareholder expectations. If the customer is happy, the shareholders are happy.
World Finance: Your vision for 2035 is to become one of the world’s top 10 finest general insurers. How do you earn that position and acclaim?
Patricia Chilip:You know, the customer experience has to be great. Our customers are millennials and Gen Z. And they want everything faster, everything digital. Everything seamless. So we want to be a 21st century insurer, on the cutting edge of technology, able to respond to customers’ needs. Because they need us constantly.
We want to be part of their lives. We want to be someone who makes life less stressful. And if – God forbid – a typhoon happens, we want to be there for them as well.
Our vision for the Philippines is to see a country that is prosperous, a country that is abundant, a country that is resilient from all of these nat cats. And everything we do is working towards that. Being there, to help our countrymen build and rebuild.
By taking care of them, and taking of their needs, we will find our way to becoming one of the world’s finest insurers.
World Finance speaks to Malta Enterprise and Residency Malta, the government agencies behind Malta’s new residency by investment programme for start-ups; as well as Malta Tourism Authority and the CEO of Trust Stamp, to understand what makes Malta such an attractive destination to live, work, and grow a new and innovative business.
World Finance: Freedom of movement and the ability to explore the world have long been recognised as vital to human and economic development. But more than ever before there is a high demand for politically and economically stable jurisdictions to welcome migrants to settle, work, and establish businesses.
Malta is one such jurisdiction. Small but agile, the Mediterranean island state recently created a residence permit for digital nomads; and has now launched programme for non-EU entrepreneurs who would like to use Malta as a launch pad for their ventures.
Economic development authority Malta Enterprise has been working to make it as simple as possible for new businesses to succeed on the island.
Kurt Farrugia, Malta Enterprise:We’ve been working together with our start-ups for the past few years, and we’ve been developing schemes in the form of grants or a payment advance, as well as ensuring that it’s a lot easier to setup a company to start up in Malta.
We try to facilitate as much as possible the business journey of a company. We step in to make synergies with our universities, with the technical institute, and also to attract companies and small start-ups with the highly innovative products and services to relocate and set up in Malta. And that is exactly what the programme aims to do.
We are looking at entrepreneurs outside of the European Union which are the game changers in various industries. Eligible activities that fall under the residence programme would be in manufacturing, software development, industrial services, health, biotechnology, and blue and green economy; as well as other activities that would provide solutions to any of these sectors. So we’re looking at the highly innovative start-ups that come up with great solutions.
World Finance:The programme is a collaboration between Malta Enterprise and Residency Malta Agency, the government body that manages Malta’s residency by investment programmes.
Charles Mizzi, Residency Malta:Residency Malta comes in to facilitate the relocation of these talented individuals to Malta. We will provide residence permits to the founders and co-founders, together with core employees who will be crucial in setting up and operating this business.
But we won’t stop there. We will also be providing residence permits to family members who will be relocating to Malta.
At first we will give a three year residence permit. If the business is doing well, we can renew for a further five years for the founders and co-founders. Core employees have their permit renewed for another three years.
The programme has been designed to provide flexibility and peace of mind to these individuals. We know this is a big decision for them, so we want to make this as smooth as possible.
We welcome people from all walks of life, and we hope to attract more and more people to come and live on our island and enjoy all the benefits that our country has to offer.
And it does have a lot to offer. Last year 2.3 million people visited Malta – and 20 percent of the population are ex-pats who found that the islands’ lifestyle, hospitality and infrastructure made it the perfect home.
Francesca Vincenti, Malta Tourism Authority:Well the island of Malta is in the centre of the Mediterranean sea; it is Europe’s smallest member state, both in terms of land mass and its population size. We’re very well connected to airports in Europe, Turkey, Israel, North Africa and with the Emirates as well.
It’s a very safe place to live, and it’s one of the most affordable countries to reside in compared to other European nations. Malta is extremely welcoming to newcomers, and we have two official languages: Maltese and English.
Due to the fact that the islands are small in size with short distances between one spot and another, combined with the great weather – 3,000 hours of sunshine per year – the excellent education system, reliable healthcare system and transport, and of course the multilingual population; this creates the perfect hub for anyone looking for a happy and social work-life balance.
Now whether you’re into history, fine dining, diving, wine tasting, going to the theatre, to concerts, participating in sport competitions; you’ll never run out of things to do, and you’ll encounter people here that may just become friends for life.
World Finance:Trust Stamp is an identity technology company that made Malta its European headquarters in 2020. Its CEO, CFO and CTO moved to the islands just to help the operation get started – until they and their families fell in love with the country. Now they are all permanent or temporary residents through one of Malta’s residency schemes – and the business is thriving.
Gareth Genner, Trust Stamp:The single biggest benefit of being in Malta for Trust Stamp has been our ability to grow at a faster rate than we would anywhere else. And that’s both because of the funding that the government gave us to support that growth, but also because costs in Malta are much lower than virtually every country that we operate in, and because there are talented personnel here.
Malta has the unique distinction of being both a member of the European Union, and a member of the Commonwealth. Therefore it was a very logical leaping off place for us to go into those two networks of countries. And for us, a country where we could do business and deal with government in English was an obvious attraction.
Malta Enterprise worked with us, both advising us on all of the aspects of law and regulation we needed to deal with, together with the things that we would find that are different in the Malta market.
But once we had moved here, they remained committed. We’re in year three of being in Malta, but Malta Enterprise remains as supportive for us as it ever has been. And the range of opportunities that they seek to put before us keeps growing.
We found that being completely open and flexible in communicating with them meant that they joined in the process and became a creative partner in helping us work out how best to make that move a success.
We have found working with Residency Malta to be very straightforward and collegial. Now the new residency initiatives that Malta is establishing will broaden the range of individuals who are able to come to Malta. These programmes have clearly been designed very pragmatically to say, ‘If you are going to bring your talent to Malta, and your energy to Malta, then we want to have you here.’ And again, that’s a very proactive and positive approach, as opposed to the gatekeeper approach which you’ll find in many countries.
World Finance:The programme does seem to have accessibility at its core. Each application costs just €750, plus a small charge to cover the cost of the residence card. All the information about the scheme, and the financial and advisory support available, can be found at startinmalta.com
Charles Mizzi, Residency Malta:Although there are two agencies behind this project, prospective applicants will be assigned one point of contact who will help them throughout the whole process: from application stage to their relocation.
The process is quite simple. The first thing is to set up a meeting with our team, so that we can discuss their plans and their ideas. Obviously Malta Enterprise will be looking at the business proposal to make sure it’s viable. From our side we will look at the residency, we will do a due diligence on each individual included in the application.
Then we will start a personal relationship with the applicant. We will have discussions online and possibly even invite them to come over to Malta so that they can see first-hand what’s available for them.
Normally timeframes will take around 4-6 months in order to conduct full due diligence and evaluation of the business proposal, and then hopefully we will be welcoming a lot of innovative start-ups to Malta.
Kurt Farrugia, Malta Enterprise:Added to that of course we can assist with the implementation of a project. We’re not only assisting by granting a residence programme but also we can offer our support packages, helping you throughout the whole business journey. We’re looking at the business model and if it is a good match for the island and for the start-up itself.
Our geo-strategic location is excellent. It’s easy to do business here, and this is a really good island to live or to raise your kids or to have fantastic healthcare or a good education. A good quality of life, which is so important in this day and age.
Alpen Capital is an investment banking advisory firm specialising in debt and equity solutions for institutional and corporate clients in the Middle East, Africa, south Asia and beyond. CEO and Executive Chairman Rohit Walia explains how the firm’s work with development finance institutions and impact funders in emerging markets automatically tends towards impactful projects – and how Alpen started measuring that positive impact. In the first half of this interview Rohit talks about Alpen Capital’s rapid expansion and its other recent focus of providing funding to banks around the world.
World Finance: Rohit, you released your first sustainability report earlier this year, called Sound Impact. Why did you put this report together, why have you released it?
Rohit Walia: I think in a fashion and form to measure the impact that our transactions have. It’s something we’ve always been aware about, the fact that we work in most of the emerging markets in the world. All of them have some impact or another.
Our largest funding partners are development finance institutions or impact funders. And each of them has a different thought process on what part of society do they want to fund with. So if I look at the last few years of our transactions, a huge part of our funding has come from these people, which automatically tends itself to fund projects which are impactful – either on climate, or on the society.
So the idea was to, instead of just talking about it, see what was the impact. And then potentially put some KPIs in place over the next two to three years to measure, and aim towards potentially doing more transactions in certain areas that we feel are more impactful, both to the environment and to the societies we work in.
World Finance: Well talk me through some of the most socially impactful transactions you’ve been involved in.
Rohit Walia: IndusInd Bank, funding $35m. Complete funding has gone to women’s empowerment, lending to groups of women in the rural areas of India, some of the poorest states out there.
We funded Sahyadri, a farmers’ cooperative near Bombay, owned by 18,000 farmers. The equity came in from four development finance institutions out of Europe. This has changed the lives of all these people. We could do another dozen transactions in that fashion in the same country – huge impact on the society, on the environment.
We just did a transaction – again a few weeks back, for a large rated company called Shriram Transport, which enables existing truck drivers to become truck owners. So it creates businessmen. It was funded by Asian Development Bank, $100m.
On the corporate side, the most interesting one there has been for the Tata Group, in India. They have a huge business in about eight or nine countries in Africa, selling trucks and buses – again, makes the individual bus driver into an entrepreneur. And the Tatas fund this transaction.
So what we have done for them is taken the whole bucket of receivables, as we say. Put it into a structure into Abu Dhabi, and funded it. It’s a very interesting structure, it’s taken us one year to just put the legal structure in place. It cost a million dollars in legal fees, if nothing else. But it’s been running now very well for two years, and it’s got a huge potential to grow.
We’re looking to fund a few climate change projects in Vietnam – that’s an interesting new market. That’s one of the few countries in Asia that is actually doing a lot of work towards green energy projects.
World Finance: And now that you’ve released your first report, are you going to be updating it into the future? And is this sort of transaction going to become an important part of Alpen’s strategy?
Rohit Walia: So, we will take a look at what we have done during the year, and potentially update this by early first quarter – at least for the next two to three years. And then like I said, we will put KPIs in place for different aspects of our business.
I’m not saying we’re specifically looking for such projects. But as and when we find such projects, they tend to be more of a priority for us to take a look at than other projects which come on to the table.
Alpen Capital is an investment banking advisory firm specialising in debt and equity solutions for institutional and corporate clients in the Middle East, Africa, south Asia and beyond. CEO and Executive Chairman Rohit Walia discusses the firm’s rapid geographical growth, and the most important transactions that Alpen has advised on recently – and in particular its trend towards funding financial institutions. In the second half of this interview Rohit talks about Alpen Capital’s first sustainability report, and the impact that Alpen’s work has in emerging markets.
World Finance: Rohit, reintroduce us to Alpen Capital and the services that you offer.
Rohit Walia: So we’re a 22 year old firm, born in the DIFC in Dubai. Grown quite rapidly over the last 20 years.
Two very specific services: we are good at raising money for growth capital. And number two, at any M&A transaction which you may have in mind.
There are a lot of people who are looking to grow their businesses, i.e. acquire a business, either regionally or globally. Or we have clients who are looking to divest businesses.
We’ve got very good connectivity within our reach, and we very clearly understand what it is that you need, and how do we get there. And we also have a very good idea of what would work in which part of the GCC markets, which we can help with.
The GCC markets have become more receptive to setting up industry. The largest GCC market, Saudi Arabia, they’ve actually set up an institution, Dussur, with whom we work very closely. We’re running two transactions with them right now, to help clients set up a manufacturing base in the region.
In Abu Dhabi we have something called ADIO – Abu Dhabi investment Office. We work with them very closely too.
Each has a different offering. So we have to make sure what is it that the clients requires, and how do we match it up with what is available.
World Finance: Now tell me how you’ve grown over the last few years since we last had you in the studio.
Rohit Walia: Our home markets remain the GCC and south Asia, but we’ve grown dramatically geographically.
We were working in what, six to eight countries, now we’re in about 25-28 countries.
A lot of it is in Africa, so there’s a dozen-odd countries there: east, west, and Francophone Africa. And Asia. We’re actually running transactions from Mongolia all the way down to Cambodia. And anything in the middle!
And these are countries where either we have done, or are doing a transaction. So that’s where the growth has come from: 15, 20, 25 percent growth, year on year. But I think each of us has become a lot more efficient, you know, given the last three years of COVID and how we worked. Maybe we figured out a better way of doing things.
World Finance: Talk me through some of your most important recent transactions. You’ve been providing a lot of funding to banks lately?
Rohit Walia: Yeah: the latest one is right here in the UK, where we’ve provided equity to one of the Neo Banks. Just got licensed a couple of years ago, called Monument Bank. We just got the documents signed a month ago – a large client of ours, Dubai Investments, has taken a nine percent equity stake. It’s an important transaction, a very nice transaction.
In other markets we’ve done some very large ticket funding for financial institutions in India. A bank called IndusInd Bank. Huge impact around women empowerment lending.
So exotic markets are where we’ve had some of our recent successes.
World Finance: And the other side of your business, Alpen Asset Advisors: what does this offer?
Rohit Walia:So this side of the business actually looks after your money, whereas Alpen Capital helps you raise money.
Our clients here are mid-sized banks, large family offices, corporates; who have short-term surplus funding which needs to be parked in a fashion which can be accessed quickly and rapidly for their businesses.
World Finance: And what is going to be the strategy for Alpen Capital, moving forward?
Rohit Walia: I think we keep focus on our core: emerging markets. We can grow them, grow them a lot. There’s a humungous potential.
We’ve done very well, very successful means we’ve done one or two transactions in each of these countries. So I think there is huge scope to grow in all of them, and that will be our key focus going forward.
Beyond Globalisation: The British Virgin Islands’ contribution to global prosperity in an uncertain world is the new report published in April 2023 by Pragmatix Advisory for BVI Finance. In the third part of our interview with BVI Finance CEO Elise Donovan she discusses the key ingredients to the British Virgin Islands’ success over the last 40 years, since the BVI Business Company was first established; and how the leading international business and finance centre will continue innovating in response to the challenges posed by changing globalisation.
World Finance: Now, the British Virgin Islands has built its reputation as a leading international business and finance centre over the last 40 years; what have been the key ingredients to its success?
Elise Donovan: One of the most important things is the establishment of the BVI Business Company. We first established the BVI Business Company in 1984, and right now we have 375,000 BVI Business Companies all over the globe. So every corner of the globe you can find successful businesses using the BVI Business Company. And that has been critical to the BVI’s success.
Why do they use the BVI Business Company? Because it provides legal and commercial certainty, it’s tax neutral, in the sense that we don’t add an additional layer of tax. We also provide a sound legal and regulatory framework. We’ve established an international commercial court, as well as an arbitration centre, to help businesses navigate any conflicts or disputes that may arise.
And more importantly, the BVI is innovative and agile. We continue to create new legislation and new products and services. Right now the BVI has become a hub for digital assets, and so we are moving into that space. So we are agile, we are innovative, and we are also creating new opportunities for businesses across the world.
World Finance: Tell me more about that, because in this report you’re identifying different forecasts for globalisation. How is the BVI going to respond? How are you going to be agile and innovative in approaching these potential different futures for the world?
Elise Donovan: This is why this report was done – we look at what’s happening in the globe, and we determine how can we position ourselves? How can we adapt, how can we best change what we need to change, to ensure that we continue as a leading international business and finance centre.
One of the things that we’ve recently done is establish a virtual assets of service providers legislation. And this is to deal with what we’ve been seeing in terms of BVI becoming a hub for crypto currencies and digital assets. So we’ve responded by creating a regulatory framework that responds to that. And that’s what we do: we remain agile, we remain innovative, and we create opportunities so that businesses can thrive.
Beyond Globalisation: The British Virgin Islands’ contribution to global prosperity in an uncertain world is the new report published in April 2023 by Pragmatix Advisory for BVI Finance. In the second part of our interview with BVI Finance CEO Elise Donovan, she explains exactly how much the BVI contributes to global wealth, employment, and tax revenues; and how different scenarios of the future of globalisation will change the role of the British Virgin Islands and other offshore financial centres. You can also watch the third part of the interview: BVI Finance CEO: ‘We create opportunities so that businesses can thrive’
World Finance: Elise, tell me more about the findings of this report.
Elise Donovan:Well the report shows that the BVI is home to a globally respected international business and finance centre; an established intermediary with a proven track record of success, of facilitating global trade and investment.
We mediate $1.4trn of assets that are held across the globe, the investment in that generates 2.3 million jobs across the world, and it also creates $14bn in government revenues.
Second, the BVI is also a very cooperative international finance centre: we participate in all the global tax initiatives, as well as for anti-money laundering standards.
And third, the BVI contributes positively to the UK economy. It does not take revenues from the UK, and in fact it holds assets in the UK of $153bn. That generates 134,000 jobs, as well as tax revenues of $3.5bn. So overall we have a very positive impact on the UK economy, and we’re fiscally self-reliant.
World Finance: A significant component of the report is exploring the future of globalisation: different scenarios and the ways they may impact on the BVI; could you explain?
Elise Donovan:Yes – globalisation is changing, and the role of intermediaries like the British Virgin Islands will be more important than ever before. There are three scenarios that have been identified in the report as potential of what the future of globalisation will look like.
The first scenario is weaker internationalism. And what that means is that globalisation continues, but at a much slower pace, and of course there are more political obstacles to navigate.
The second scenario is the bloc economy. We’re seeing economic and regulatory integration between countries, but those countries are also going into geopolitical blocs, and those blocs are diverging.
The third scenario is new economic nationalism. And what that means is that countries are deciding to sort of reverse globalisation. They’re becoming more protectionist, and that of course creates more political obstacles.
And you’re going to need intermediaries, international finance centres like the BVI, who are able to navigate the complexities that are being created as a result of these scenarios.
Elise Donovan:Thank you for having me. This report, Beyond Globalisation, does two things. First, it demonstrates the BVI’s significant and continued contribution to global prosperity. It looks at how we create jobs and generate revenues. And second, it looks at various scenarios with regards to the future of globalisation, and how we can best adapt to those scenarios to maintain our position as a leading international finance centre.
World Finance: Now why did you commission this report, and why have you released it now?
Elise Donovan:Well, globalisation is changing; we’ve seen a lot of uncertainty and risk in the world recently. There’s inflation, there’s war, there’s banking crises, there’s crypto crises. So much is happening, and it’s creating risk and uncertainty.
The BVI is an intermediary that facilitates global trade and investment, and global trade is going to be more difficult. It’s going to be more challenging. And so this report answers the questions on how intermediaries, international finance centres, can respond to this risk and uncertainty. How can we adapt? How can we change? How can we be best positioned to respond to the risk and uncertainties that are being created in the world.
World Finance: And who is the report for, who’s it aimed at?
Elise Donovan: The report is aimed at a wide range of stakeholders; and this includes the clients doing BVI business all across the world. The advisors and firms that service those clients. The policymakers as well as regulators who set the standards for global business. And of course it includes the local BVI community; whether it’s the government or the private sector.
The report is tangible, evidence-based research that demonstrates how the BVI contributes to the global economy, how we support and create jobs, as well as how we generate revenues for government coffers across the world.
It also debunks some of the myths that are often propagated about the jurisdiction. We are a small force on the global stage, punching way above our weight. An established intermediary with a proven track record of success of facilitating global trade, investment, finance, and mobility. And we’re a significant global contributor.
Dubai Electricity and Water Authority is the exclusive electricity and water utility provider for the emirate of Dubai. It generates, transmits, and distributes electricity and potable water to more than a million end users throughout the emirate, with a number of landmark projects and achievements that have made it one of the most effective, efficient, and sustainable utility providers worldwide. DEWA Managing Director and CEO, His Excellency Saeed Mohammed Al Tayer, explains how the authority has embedded the UN’s Sustainable Development Goals into its vision and strategy, is making viable progress towards achieving its carbon zero ambitions, and has established world-class governance across its operations to provide a sustainable service for the people of Dubai.
H.E. Saeed Mohammed Al Tayer:Sustainability is an essential part of our vision and strategy. DEWA is the first government organisation to adopt the 17 UN sustainable development goals in its strategic plan to achieve long-term sustainable growth with its economic, social, and environmental aspects.
Guided by the vision and directives of the wise leadership, we have a clear target for the energy sector to provide 100 percent of the energy production capacity from clean energy sources by 2050, based on the Dubai Clean Energy Strategy 2050, and Dubai Net Zero Carbon Emission Strategy 2050.
For many years, DEWA has stopped launching new projects that produce energy using fossil fuels. All our future generation and desalination capacity growth is intended to be based on the use of renewable energy.
One of our biggest projects to achieve 100 percent clean energy by 2050 is the Mohammed bin Rashid Al Maktoum Solar Park. This is the largest single site solar park in the world, utilising the independent power producer (IPP) model. Its current production capacity is 2,027 MW; about 14 percent of DEWA’s total power production capacity. By 2030 it will have a production capacity of 5,000 MW, using photovoltaic solar panels and concentrated solar power.
We are working on a 250 MW pumped-storage hydro-electric power plant in Hatta, that is the first of its kind in the GCC region. It will have a storage capacity of 1,500 MWh, using the water stored in Hatta dam.
Dubai achieved 21 percent CO2 emission reduction by the end of 2021, exceeding the target of 16 percent. We have a new target of 30 percent CO2 reduction by 2030.
Our other main initiatives include a joint district cooling company, Empower, with more than 40 percent reduction of electric energy consumption; a Super ESCO company to promote energy efficiency by retrofitting 7,792 existing buildings in Dubai to date; and installing 350 EV charging stations throughout Dubai, to date – it is planned to reach 1,000 EV charging stations by 2025.
DEWA also encouraged its customers to install photovoltaic solar panels on their premises with a connection to DEWA’s distribution network, to meet a part of their demand. By the end of 2022 the total installed capacity reached 493 MW.
Last, executing the Dubai Demand Side Management strategy resulted in a 17.1 percent reduction per capita in electricity consumption, and a 21 percent reduction per capita in water consumption.
Last year DEWA became a listed company on the Dubai financial market. This marked the beginning of an exciting new chapter in DEWA’s growth journey to become one of the leading companies regionally and globally.
DEWA has a world-class governance system and a continuous record of good governance across all its operations.
DEWA is quite active in the Middle East and North Africa OECD regional working group on corporate governance. This active partnership allows DEWA to benefit from the OECD countries’ corporate governance experiences, as well as highlight DEWA’s positive strides on corporate governance.
Bank of Industry is Nigeria’s oldest, largest, and most successful development finance institution. Over the last six years it has provided financing to over four million enterprises, helping create more than seven million jobs, and diversifying Nigeria’s economy beyond dependence on the volatile oil and gas industry. BOI’s managing director and CEO is Olukayode Pitan – he explains the role that Bank of Industry can play in improving financial inclusion, how the bank supports women and young entrepreneurs, and the role that home-grown fintech is playing in the bank’s transformational mission. You can also watch the first half of this interview, where he discusses that mission in more detail.
World Finance: I want to talk to you about financial inclusion, which continues to be a challenge in Nigeria; what role do development finance institutions like BOI play in addressing this issue?
Olukayode Pitan: The Central Bank of Nigeria, one of the things they want to do is to ensure we have over 90 percent inclusion. Financial inclusion in Nigeria requires a lot of fintech. But BOI has been able to develop a platform that leverages technology, big data, biometrics, and having physical agents on the ground.
The government uses that platform to distribute NGN 75 billion – about $160-170bn, through BOI, to about 1.2 million people. That same platform is what is being used now for the World Bank programme to alleviate poverty caused by the coronavirus. Thirty of 36 states in Nigeria are using us. We have reached millions of people; in fact that platform won an award recently. So that is what we are doing to promote financial inclusion.
World Finance: You have products specifically targeting under-served groups – women and young people, for example. Talk me through the work that BOI is doing here.
Olukayode Pitan: Most of the small businesses that we have in Nigeria are actually owned by women.
What we have done in Bank of Industry is to create a gender group, catered to women and women-owned businesses. Because most lenders, they didn’t want to lend to the women. But lending money to women is good business! Because one, when you look at the ratio of repayment – women versus men – women do much better. And then when you give money to the women, the whole family benefits.
Also, Nigeria has a lot of youth. Many of them don’t have collateral, because they’re just leaving school. So we take risks on these young ones, who have the entrepreneurship spirit. We can look at what they want to do, they can borrow money at single digits from the bank. So we are being innovative in financing the areas where there’s need.
World Finance: The bank has become an official signatory to the UN Principles for Responsible Banking; how are you incorporating this firm commitment to sustainability into your operations?
Olukayode Pitan:One of the first things that we did is to ensure that our staff are trained, so that we can actually do what we have signed up to do.
For new customers that approach the bank, we want to ensure that what we are financing is responsible, we’re not going to create more problems for the environment.
We’re also going to help customers that we have already financed to have that transition to ensure that they are going to reduce carbon emissions.
World Finance: As industry is becoming increasingly automated or digital-first, how are you staying on top of technology trends to ensure that you can continue delivering this vital work into the future?
Olukayode Pitan:Most of the things that we do are digital. For instance, we raised $1bn in March 2020, and €1bn in December 2020: all done virtually and online.
So the platforms are there. They’re good. But you need good people too. And that’s now a problem! Because their skills are required all over the world.
So we have designed a product to invest in fintech, putting $18m in of our own resources. It’s going to be a fintech fund of $75m. We are also building tech hubs. We have built 10 as part of our corporate social responsibility. There are four that are ongoing. But the target is that every state in the country, we have a tech hub donated by Bank of Industry.
In Nigeria today there are some companies who have become unicorns. They were small Nigerian companies that now are playing in the world sector, and they are worth over $1bn. There are many more smart Nigerians who can create businesses that can become the unicorns in the future. We are part of that dream.
Bank of Industry is Nigeria’s oldest, largest, and most successful development finance institution. Over the last six years it has provided financing to over four million enterprises, helping create more than seven million jobs, and diversifying Nigeria’s economy beyond dependence on the volatile oil and gas industry. BOI’s managing director and CEO is Olukayode Pitan – he explains why the bank’s funding model is so important to Nigeria, and how the bank’s focus on sustainability and responsible banking is ensuring it can have a lasting impact on Nigeria’s industries. You can also watch the second half of this interview, here he talks in more detail about how the bank supports businesses, particularly those led by women and young entrepreneurs.
World Finance: Olukayode, tell me more about those four million enterprises. Who are you helping, and why is it so important that Nigerian businesses get access to the kinds of financing you provide?
Olukayode Pitan: Thank you very much. Like you said, Bank of Industry is Nigeria’s oldest DFI. Our mandate is to transform the industrial sector, you know, for the economic development of our country. And we do that in many ways.
We provide advisory services and funding to micro, small, medium and large enterprises. We have access to long term financing; so, we’re able to give loans for up to 80 years. We’re able to give them cheaper costs of funding – most of our loans are priced at less than 10 percent. Today in Nigeria inflation is slightly over 20 percent. So you are getting a good deal when you actually come to Bank of Industry!
And then we focus also on the areas that government has interest in. Because that is one of the reasons why this bank was set up. For instance, the creative sector. Now it’s popular; but initially we were the bank that went in there to basically de-risk that environment. And so many other areas: agro, manufacturing, IT. Basically we finance virtually everywhere.
World Finance: Why does Nigeria’s industry need to be transformed? And how will you know if your work is ever done?
Olukayode Pitan:When you look at Nigeria, most of the things that we use now are imported. That’s a drain on the foreign reserves of the country.
Many of those things could be manufactured and produced locally. Because one: we actually make use of our local raw materials, we increase capacity of the companies we have locally, we reduce the pressure on the foreign exchange of the country. And then of course, massive employment.
In Nigeria there are about 41 million SMEs. They provide about 80 percent of employment. That’s why Bank of Industry is very important.
World Finance: And how is this important work made possible? Talk me through your own financing.
Olukayode Pitan: In the last five years we have been quite successful in raising funds. Either we raise through syndications or the bond market. We approached the Eurobond market for the first time this year, and it was quite successful.
All these funds are in foreign exchange. Now the question is, how do you protect the bank from foreign currency rate risk? So we normally swap all of these monies into naira, through the Central Bank of Nigeria. And they have helped us tremendously by providing guarantees. So that’s where the funding has come from for the activities that we have been doing.
World Finance: World Finance of course is proud to call Bank of Industry our Most Sustainable Bank in Nigeria for 2022; what does this recognition mean to you?
Olukayode Pitan:Well, for us it means that our efforts have been recognised. We subscribe to responsible banking. That means that we are in alignment with the global SDG goals, and the Paris climate agreement, to ensure that the business we are doing is such that it’s fair to everybody, and it takes into account the future.
So we are proud, and we are happy. If you do responsible banking in Nigeria, it helps not only Nigeria but the whole world.
Chesapeake Utilities Corporation has been providing energy to the US east coast for over 160 years. But it is a modern, diverse company, with a clear commitment to the planet and to the people it serves, alongside its drive to develop profit for its shareholders. President and CEO Jeff Householder explains how the corporation is meeting the challenge to build an environmentally sustainable future: by reducing its own emissions, supporting suppliers and customers to reduce theirs, and innovating in the energy mix it provides. He also discusses the company’s corporate governance achievements – in particular how increasing board diversity has improved the conversation around Chesapeake Utilities’ strategy.
World Finance: Jeff, first can you introduce us to Chesapeake Utilities, and the scale of your operation?
Jeff Householder: Well we’re obviously a US corporation, traded publicly on the New York Stock Exchange. About $2bn, little bit more than $2bn in total assets and market capitalisation.
We serve around 300,000 customers over about nine states, with operations principally in gas transmission, distribution, some electric distribution. We’re probably the 15th or 16th largest propane company in the US at this point.
Our growth has been fairly phenomenal over the past 10-12 years; we’ve doubled the size of our company three times, over that period of time. We have a long, very strong track record of financial performance. We’ve seen returns above 11 percent for 17 years in a row. I think we’re on 60-plus years of paying consistent dividends. We typically are in the upper quartile of energy delivery companies in terms of just about every performance measure that you could think of.
World Finance: The energy industry is under more pressure than ever before to transform, and innovate, and enable an environmentally sustainable future: how is Chesapeake meeting that challenge?
Jeff Householder: Well I think first of all, we have accepted the fact that it is a challenge, that we have an obligation to perform. We are focused significantly on our internal emissions, doing everything from limiting vehicles, converting them from gasoline and diesel to other fuels.
We’re purchasing satellite time, looking for leaks in the system, and we’ve replaced literally hundreds of miles of pipeline and tightened up our systems significantly.
We’re also focused upstream on our suppliers, to make sure that we’re getting supplies from individuals that are also paying attention to their emissions. And we’re working with our customers to make sure that we can do everything we can to ensure that their emissions are reduced.
World Finance: Your stated mission is to “deliver energy that makes life better for people and the communities [you] serve” – what does that look like in practice?
Jeff Householder: Well I think that follows several different patterns. One is, everywhere we go with natural gas, we find that economic development improves. We bring jobs to the communities, it really is an amazing thing to see communities blossom when they get natural gas service for the first time.
I’ll give you an example, we recently expanded down into another area in southern Maryland that had not had natural gas service before. Converting oil, coal, much more significant emission fuels. And we’re seeing economic development in those areas flourish. I mean you’re beginning to see additional jobs come into those communities because of the expansions of industry and commercial development that’s occurring around the natural gas opportunity.
We also have a group of employees that are highly engaged and that are highly dedicated, not just to supporting customers, but to supporting the communities where we serve. And so we have high levels of charitable contributions, employee volunteerism. We really spend a fair amount of time in our company thinking about how we are providing services to customers, how we are supporting our communities. And what we need to do to make sure that our employees are engaged and able to participate in all of those things.
World Finance: Congratulations on winning the World Finance award for Best Corporate Governance in the US for 2022; what does this recognition mean to you?
Jeff Householder: Well I think it’s a testament to the great work that many people in our company have done over the last many, many years. This is not a recent occurrence for us; we take corporate governance very seriously, our board is taking it very seriously. We’ve seen increases for example over the last few years in the diversity of our board. And it really has changed the way that the board interacts, the way that the board thinks about issues. We’re seeing a much more robust conversation about where we need to go strategically, and it’s all because I think that we have more significant diversity on the board.
We’ve made a number of efforts to increase the transparency of our reporting. And we have a fundamental value in our company of integrity. And I think we try to live by that every day, and our governance actions and practices speak directly to that.
World Finance: Finally, what is your vision for a sustainable energy industry, and for Chesapeake Utilities?
Jeff Householder: I think there are several things; as I mentioned earlier, we have an internal obligation I think to make sure that our emissions are as low as we can possibly make them. I think beyond that there are a number of actions that our company is taking and can take.
We will see definitely a change in the chemical composition in the gas that we provide through our pipeline services. I think you’ll see much more renewable gas, we’re moving down a path to invest in those operations ourself. I think you’ll also see an opportunity to introduce hydrogen into our systems. We’re already starting to test that in some of our industrial facilities.
I think natural gas has a long runway ahead of it: to reduce coal, to reduce oil, to reduce other fuels that are much more impactful on the environment.
We also see significant opportunities both for our employees and for our customers to let us help them manage their emissions reductions. And so I think those are just a handful of the issues that really drive us forward, not only doing the right thing in the environment, but actually being able to do that and continue to satisfy our investors’ needs for earnings.
Grupo Financiero Banorte has long been at the forefront of digital banking in Mexico; Chairman Carlos Hank Gonzalez explains the bank’s latest ‘1-2-3’ digitisation strategy, how it is delivering high value, banking-in-minutes functions for its customers, and how Banorte is able to move closer and closer to a hyper-personalisation mode of promotion and service delivery.
World Finance: Carlos, tell me about Banorte’s current digitisation strategy.
Carlos Hank Gonzalez: After successfully concluding our strategy for 2020, we defined a new vision named 123. This new vision aims to make Banorte the best doing banking in a digital world, and we are on track to achieve it.
This strategic plan focuses on hyper-personalisation. This means offering custom solutions to match each personal circumstance by expanding our digital capabilities while placing the customer at the front and centre of our digital transformation.
To meet this objective, we defined a strategy based on three pillars:
First, and the key piece: maintain the acceleration in Banorte’s digital transformation process. Continue pushing for a digital offer, operation and service for people and companies.
Second: to accelerate the transformation of our digital services for our customers, we established strategic alliances with partners such as Rappi – with more than 600,000 credit cards already delivered.
And third: to launch a new digital bank, and explore all potential opportunities.
World Finance: And what are the first applications of this 123 vision?
Carlos Hank Gonzalez:Banking in minutes. We’ve already delivered significant progress in that area: branches can open personal accounts in just 15 minutes, 100 percent digitally, incorporating high-value functions and security for the customer.
Among other advances, credit cards and mutual funds are available from the bank’s mobile app in a matter of minutes.
There’s also paperless processing of contracts through any of our channels and digital identity verification to make it easier, quicker and more secure for our customers to access our services.
We will continue working on four major technological bridges: the use of the cloud, artificial intelligence, data and biometrics identification. All targeting the creation of custom services for each person.
World Finance: How else is Banorte innovating?
Carlos Hank Gonzalez: We invest around 13 percent of our total income each year in transforming our bank to continuously improve our self-service channels and enhance our banking operations, as well as to leverage on data about our customers and the market to achieve hyper-personalisation.
Among many initiatives, Banorte’s analytics team has developed indicators that incorporate information from its branches, including valuable insights on each micro-market to support existing clients and attract new ones.
We have moved from a strategy of one-size-fits-all promotion to one increasingly close to hyper-personalisation.
Also, we operate through a collaborative scheme called cell-based working, in which multi-disciplinary teams are assigned a specific task, such as improving a process or developing a new product, accelerating the execution to create an improved customer experience.
Thanks to these and many other efforts we recently received a Google Cloud Financial Services Customer Award, honouring Banorte for innovative thinking, technical excellence and digital transformation.
World Finance: And what about customers who may prefer a more traditional approach?
Carlos Hank Gonzalez:At Banorte, we believe we have found the right balance. The goal is to seamlessly combine our branch-based services with our digital efforts. It ensures a flexible experience that works for all ¬– whether a customer prefers to bank in-person or on their smartphone.
Innovation is at the core of what we do, and that’s especially critical for the industry as a whole during these unprecedented times.
The UK has entered a period of real interest rate volatility in the last year, as the Bank of England struggles to contain the inflationary impact of the invasion of Ukraine, soaring energy prices, and the European cost of living crisis. And for treasury departments still using manual processes and spreadsheets to manage their debt, this has meant frequent changes to formulae and even more work checking for errors – hugely compounded by the Bank’s move from LIBOR to SONIA. But Swedish debt and risk management company Nordkap has a solution: its cloud-based automation software can automatically compound the daily SONIA rate and perform scenario analyses to project the total cost of debt. Head of International Sales Fredrik Eriksson explains how Nordkap can save treasury management departments time and effort, and the company’s plans to pilot its services in the UK before launching in mid-2023. You can also watch the first half of this interview with Fredrik Eriksson, where he explains just how much time and money Nordkap can save for commercial real estate treasury departments.
World Finance: I’m back with Fredrik Eriksson from Nordap, the commercial real estate treasury management specialists. Fredrik, here in in the UK we’ve entered a period of real interest rate volatility, for so many reasons; but compounding that challenge for commercial real estate companies is the Bank of England switching from LIBOR to SONIA?
Fredrik Eriksson:Yeah; going into 2022, we saw interest rates going up already back in the fall of last year. And no one could imagine that we would have a war, and the energy crisis, and coming out of the pandemic with the supply shocks. And the inflation that took off because of that has forced the Bank of England to increase rates multiple times.
But with the overlay and the transition from LIBOR to SONIA: commercial real estate companies are sitting in a position where they have to update manual spreadsheets multiple times a year, unless they have a system in place. And with the SONIA new calculation method, that’s not really an easy feat. It’s time consuming, and again it comes down to searching for errors.
World Finance: How does Nordkap’s treasury management system address this challenge?
Fredrik Eriksson:Well it’s a matter of having the calculation method for SONIA intact and in place, because a lot of the companies today struggle with setting up processes in how to calculate interest.
When we had LIBOR, you knew going in to the new period how much you’re going to pay by the end of that period. You can’t take that for granted anymore – in fact you find out five days before the payment due date how much you need to pay.
Within our sleeve of modules we have the ability to do a lot of scenario analysis and what we call budget reporting. Where we can do a lot of simulations with… we look at the forward curve of SONIA, for example, and together with that we can run scenarios and see how your interest rates cost will change depending on different scenarios.
It allows you to be more proactive and have a better understanding of where will I be by the end of the quarter?
World Finance: And of course you’re here in London as you prepare to bring your services to the UK; how does the market compare with back home, and how are you adapting your offering?
Well it’s a good question. I mean we’re looking at the UK market now, and we are initially scratching the service. We’re realising very quickly that it’s a very, very large market, and of course that’s the reason we’re going after it!
But what we’ve found though, even in the last couple of days looking at some of those competitors, they’re not really focused 100 percent on the commercial real estate market. They are more broad in their nature. They might not even be automated! We heard about a competitor yesterday, a fairly big one. You can enter your debt in their system, but you actually cannot get the interest updated in their system.
So we feel that where we are right now, we’re fairly nimble in that regard. So that allows us for example, going into this pilot programme, and we find out more about the intricacies and the special needs of some of the UK market needs, we can scale up within our development teams and bring in more people. And really help focusing on some of the features that are more required in the UK, compared to for example Sweden.
World Finance: Yes so you’re starting with this pilot programme – tell me more about that, and, do you have a timescale for your full launch in the UK?
Fredrik Eriksson:We have this three phase approach here. We will bring in three or four pilots, basically to validate that our calculation methods are correct. We’ve of course checked with BoE and so forth, but we want to make sure that the nuances between the different banks, that we get everything right.
So that’s the first phase with the pilot programme, and it allows companies to be part of helping us, and customising a system tailored to their specific companies. So they sort of create a wishlist of things that they would like to see us implement and develop over time.
So the pilot programme is estimated to run Q1 of next year, 2023. And then we have phase two, sort of the second quarter, where we will go into a sort of free trial and roll out a more complete solution to then hopefully having regular paying customers in the second half of next year.
