Ares & Co


Real Time and True Time

Real Time and True Time

The surge of the need for real time solution

The recent statistics on the usage of smartphones show that consumers can use their device up to more than one hundred times per day. They are connecting a myriad of sites the most popular are of course like Facebook, Twitter and Wikipedia, the bank sites are also raising in terms of usage. In the capital markets world, the High Frequency Trading (HFT) platforms are now generating orders to the trading book every nanoseconds.

The appearance of real time in the Financial Services industry is also getting concrete in every days life for activities like car-pooling, couch surfing, instant payments. Subsequently, real time forces the adaptation of the offerings and of the organizations. FinTech do offer more and more those services.

Many aspects of the financial services industry are in some ways affected and have strong impacts on the market structures. Take the examples of HFT where new platforms are being created at a fast pace, with an impact on market prices and on the traditional brokerage business. It is also to be noted that the frequency of mini market crashes are increasing due to spot liquidity crisis on specific securities.

On the more long run, if you factor in the way insurance can be impacted by rented "self-driven" cars, then, you can imagine consumers willing to purchase an insurance for the time of their ride: real time insurance quote for a restricted period of time.

The surge of the need for real time solutions for the financial institutions (FI) is a major transformation program. Most IT systems of the FIs are based on batch logic; historically their foundations are built up on the accounting system.

In our mind then the question is how to provide real time in a true way and incorporating it inside the fabric of their operating models, is it always needed or is it the new paradigm a FI needs to adopt to be sustainable long term?