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Financial services M&A update: Q3 2017

Banks and other financial institutions continue to consider new technologies, including the further adoption of blockchain, voice payments, and artificial intelligence while working to fight growing network-based security threats. This 'Financial services M&A update: Q3 2017' provides Deloitte Corporate Finance LLC insights and market data analysis that shed light on M&A trends in the financial services industry.

Financial services trends

  • Financial blockchain adoption continues1: Worldwide, banks, and other financial institutions are experimenting with and implementing blockchain technology to track finance related to trade. Through programs that automatically track goods and release payments, companies such as Maersk and IBM are experiencing successful results from the digitization measures.
  • Surge of voice payment technology2: Recently implemented technology in mobile banking applications now enables customers to conduct voice payments. Now, customers can send money simply by speaking to built-in voice recognition on a personal device and do not need to open the banking application. Payments are approved using fingerprint sensor verification technology.
  • Banks develop artificial intelligence3: Many banks are in the process of implementing artificial intelligence programs such as machine-learning and natural language processing to better manage costs and develop insights into their customers. This initiative is an attempt to better the perceived industry trend of 80/20 (that banks spend 80 percent of their time collecting and organizing information and only 20 percent analyzing it for results).
  • Network-based security threats4: As banks have improved efforts to quell physical ATM thefts, would-be thieves are resorting to network-based techniques to infiltrate machines. These techniques not only help them acquire the cash stored inside ATMs but also enable the logging of card data from bank customers for later use.

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1 Arnold, Martin. “Banks Team up with IBM in Trade Finance Blockchain,” Financial Times. October 4, 2017. https://www.ft.com/content/7dc8738c-a922-11e7-93c5-648314d2c72c, accessed October 5, 2017.
2 “Barclays Rolls Out Siri Integration for Voice Payments,” Finextra. August 21, 2017. https://www.finextra.com/pressarticle/70420/barclays-rolls-out-siri-integration-for-voice-payments, accessed October 5, 2017.
3 O’Donnell, Brian. “Artificial Intelligence Could be the Future of Banking,” The Globe and Mail. August 20, 2017. https://beta.theglobeandmail.com/report-on-business/rob-commentary/artificial-intelligence-could-be-the-future-of-banking/article36038026/, accessed October 5, 2017.
4 Zorz, Zeljka. “ATM Hackers Switch to Network-based Attacks,” HelpNetSecurity. October 5, 2017. https://www.helpnetsecurity.com/2017/09/27/atm-network-based-attacks/, accessed September 27, 2017.

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