Alternative and Receivables Financing Forum - Is fraud on the increase?

Dror Shapira, the author of this article, is co-founder and CEO of INVIOU. 

I had the honors of taking part in the 6th Annual Alternative and Receivables Forum, by BCR Publishing, November 14th 2019.

It was a full day of four different sessions, expertly chaired by John Davies and participated by an impressive delegation covering all industry players.

The discussion started with exploring the expanding horizons of the alternative finance sector, followed by technology overview and a summery of the current Open Banking, PSD2 and “Open Data” by Ryan Edwards-Pritchard.

Session two turned the two streams almost impossible to choose which one to listen to as both where so interesting, but once chosen, you immediately forgot and dived into the vibrant discussion of the future of the industry and its new opportunities, one panel discussing innovative solutions for SME financing with fresh statistics to spice up the debate and the parallel panel regarding investors, led by Andre Casterman.

Session three started with parallel sessions the first relation to almost nonexistent of auction-based market placed for invoice financing while future hides more business models for receivables financing. Next, and surprisingly, after lunch, a more interactive debate, led by John Davies that included the audience and focused about technology and blockchain in particular on the one hand and the next panel that stressed the different approachs of data sharing by big banks and credit insurers. All in all, technology and trade credit, both can be looked at as enablers and risk mitigants for the benefit of the industry.

I took special pleasure in participating in the panel session of: Is fraud on the increase and what are the latest methodologies for tackling it? It was expertly moderated by Andrew Bowden-Brown and was diversified by my fellow panellists, John Davies, Andrew Churchill and Harold Brako. We examined the environment for organized crime and the way they share data to the detriment of the financiers and businesses, the lack of resources across the law enforcement systems and exploring the new technological solutions to be used in when fighting off fraudsters.

A few facts and numbers:

  • Last year the advanced security systems and innovations in which the finance industry invests to protect customers stopped more than £1.6 billion of unauthorised fraud. But despite this, criminals successfully stole £1.2 billion through fraud and scams in 2018. (Fraud the facts 2019, UK Finance).
  • In 2018 alone it was estimated that there were 3.6 million fraud incidents in the UK, about third of all crime in England and Wales.
  • Naturally, there are many ways to perform fraudulent activities, that include, payments fraud, credit card fraud, invoice and tax fraud. I express the notion that many startups in this industry tackle some aspects of fraud as it can never be a one stop shop. I strongly believe that financial institutions and credit insurers should not fear to integrate more than one solution in order for them to be best covered.

    The day closed with a diversified panel attempting to portray an outlook towards 2020 and beyond to the industry, growth and political challenges. Well done BCR Publishing for such a succeful selection of both topics and speakers!

    INVIOU is operating in the receivables financing fraud reduction solutions.

    INVIOU is a financial records and charges registry based on distributed ledger technology backed by TechStars, Barclays, Nielsen, and IBM. It is disrupting the SME financing industry by enabling financial institutions and credit insures to provide instant, competitive safe and simple receivables financing to SMEs. Using INVIOU’s registry to verify invoice ownership and availability for financing, greatly diminishes the costs associated with the  fraud and friction which results from faulty, inflated, fictitious and double invoicing.