All banks are focused on minimising operating costs in the current economic environment, and this was particularly the case for The Access Bank UK Ltd when it set up operations in 2008. “We had very clear set budgets which could not be breached, and a demanding timescale for the implementation of the processes,” says Jamie Simmonds, Managing Director/CEO.
“We submitted our application to the UK Financial Services Authority (FSA) on 31st January 2008 and our aim was to gain authorisation as a bank by the summer of 2008, and to commence operations as soon as possible after that.”
In order to achieve these goals, a clearing bank partner was required to provide a range of services, including integrating with the bank’s new core operating banking software, automating its back office and implementing new straight-through processing methods. Another priority was the ability to bring the solution to market quickly. Finally, due to budget constraints, a pricing model was required which would enable the initial start-up costs to be amortised over the duration of the contract.
In January 2008, The Access Bank UK Ltd approached HSBC to discuss how these goals could be achieved while obtaining approval from the FSA. The chosen solution was based on HSBC’s Managed Payments Service (MPS) channel, developed in partnership with Simplex Consulting. “MPS is a payment channel to HSBC and other banks using SWIFT, offering the highest level of automation and reach for both domestic and international markets,” explains Simmonds. “A series of software applications offered as a ‘pay-as-you go’ managed service are provided by HSBC and its technology partners. This STP approach was essential to us as a small bank – we needed the best technological solution to overcome the need to have a very large corporate treasury and back office operation, which would have been impractical and prohibitively expensive.”
“The automation of payment flows, reconciliations and anti-money laundering, combined with the support for numerous formats, led to reduced costs compared to other start-up operations.”
MPS is a modular solution offering a wide range of functionalities which are tailored to The Access Bank UK Ltd’s needs. Key features include: a web-based payment capture capability for both domestic and international payments, an outsourced SWIFT connection to HSBC and other banks supporting XML and automated anti-money laundering checking. Files are formatted according to HSBC’s requirements and local clearing house, XML and SEPA formats are all supported. Nostro accounts and cash positions are reconciled on an automated basis, meaning that only exceptions need to be managed.
Crucially, the solution required no capital expenditure at the outset as charges are amortised over the duration of the contract. “This means that the benefits of MPS can be achieved immediately after transition and go-live,” says Simmonds. “Furthermore, billing is undertaken monthly to include payments charges, including the cost of the technology managed solution. This offered a compelling value proposition for a start-up such as us, with a reduced cost budget in the first few years, and greater speed to market.”
As a result, The Access Bank UK Ltd was able to obtain FSA authorisation and its customer propositions were launched on 6th October 2008. The automation of payment flows, reconciliations and anti-money laundering, combined with the support for numerous formats, led to reduced costs compared to other start-up operations. This comprehensive solution is also fully future-proof, with plenty of scope to be expanded as The Access Bank UK Ltd’s business continues to develop.
