IBS Journal November 2015


Pasha Bank in front-to-back office overhaul with Oracle FSS


Azerbaijan-based Pasha Bank has embarked on a core banking software overhaul project with Oracle FSS. The bank is implementing Flexcube


Universal for core processing and Flexcube Direct for online operations. The project is carried out together with


Oracle FSS’s local partner, Datas. Pasha Bank is keen to become a sig-


nificant force in the region, says the ven- dor, and was looking for ‘a core banking solution that would enable it to compete effectively internationally as well as in its domestic market, while still reducing its operational costs’. The bank plans to establish a regional


network in Turkey and Georgia. ‘The region that Pasha Bank and its


subsidiaries operate in is changing rapidly,’ says Taleh Kazimov, the bank’s CEO. ‘We selected Oracle FSS to revolution- ise our core banking systems’.


The bank has been on the software


renovation path for a couple of years. In 2013, it selected a new treasury and capital markets system from Calypso. Flexcube will support the established


corporate operations of Pasha Bank and will also assist with growing the retail bank- ing business.


Pasha Group Pasha Bank was set up in 2007 with a focus on the corporate and high net-worth sec- tors. It belongs to the Pasha Group, which also operates in the travel, insurance and construction industries in Azerbaijan. Pasha Bank’s initial remit was to service


clients in the expanding non-oil sectors of Azerbaijan, following the government’s economic diversification efforts. Pasha Group also has another bank under its umbrella, Kapital Bank. The bank is a more established player in the market,


being a successor of Azerbaijan Savings Bank (established over 140 years ago). Kapital Bank focuses on the retail bank-


ing sector, with over two million customers, it has been using Oracle FSS’s Flexcube for nearly a decade.


Flexcube in Azerbaijan Flexcube is a well-established system in the country. Its first taker was International Bank of Azerbaijan, back in 2004. The aforementioned Kapital Bank followed in 2006. The local operations of Finca, a global


microfinance network, were added in 2007/2008 as part of the multi-country roll-out. Bank Respublika also signed for Flexcube in 2008. In 2012, Bank Technique turned to


Oracle FSS following its disastrous attempt to implement Temenos’ T24. Tanya Andreasyan


Sweden mulls life as first cashless country


Sweden could become the world’s first cashless society, according to a study by Stockholm’s KTH Royal Institute of Technology. The famously progressive nation has


embraced IT and cracked down on organ- ised crime and terror, which have all helped this cash-free vision take off. Niklas Arvidsson, an industrial technol- ogy and management researcher at KTH, says the widespread use of mobile pay- ment systems are also helping speed up the day when Sweden replaces cash alto- gether. ‘Cash is still an important means of


payment in many countries’ markets, but that no longer applies here in Sweden,’ Arvidsson says. ‘Our use of cash is small, and it’s decreasing rapidly.’ In a country where bank cards are


routinely used for even the smallest pur- chases, there is less than SEK 80 billion ($9.6 billion) cash in circulation, a sharp decline from just six years ago, when the


total in circulation was SEK 106 billion ($12.8 billion). ‘And out of that amount, only some-


where between 40% and 60% is actually in regular circulation,’ Arvidsson says. The rest is tucked away in people’s homes and bank deposit boxes, or can be found circulating in the underground economy.


Staying ahead With digital giro systems, early electronic payment services and other advances in online financial services, Swedish banks have been early adopters of advanced IT systems, he says. ‘Combined with a strong IT sector, this


has led to more competitive financial ser- vices in Sweden. The success also depends on the Swedish consumer tradition of wel- coming electronic payment services.’ Besides simplicity and lower costs, dig-


ital payments also add transparency to the nation’s payment system. Several banks in Sweden already have 100% digitalised


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branches that will simply not accept cash. ‘At the offices which do handle bank-


notes and coins, the customer must explain where the cash comes from, according to the regulations aimed at money laundering and terrorist financing,’ Arvidsson says. KTH says bank staff in Sweden are required to file police reports in response to suspicious cash transactions. In spite of its popularity, Sweden will


still have to ensure that all people are able to participate in the new payment system, Arvidsson says. The transformation would present serious challenges for those who are unfamiliar with computers and mobile phones – mainly older people living in rural areas. KTH says other segments of the pop-


ulation likely to feel the impact are the homeless and undocumented immigrants. In a society without notes and coins, they will be even more at the mercy of govern- ment systems to survive.


Antony Peyton


IBS Intelligence has launched its IBS Chat Forum, a global platform to bring industry participants together on everything related to banking and financial services technology. Log on to www.ibsintelligence.com/ibschat and connect with peers across the globe now!


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