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Digital tools for supervisor ‘superpowers’

Cambridge SupTech Lab’s six inaugural tools, and how they serve as supervisor ‘superpowers’ in fostering innovation and the creation of suptech applications

For as long as I can remember, I have been driven to explore the power of technology to augment our already unique capabilities as humans. I’ve automated industrial machinery and designed aerospace equipment to expand our physical capacities. I’ve launched fintech platforms, built deep learning systems, given lectures and delivered bootcamp sessions to explore the expansion of our societal efficiency and intellectual abilities. I’ve created digital communication technologies and innovation galleries to test the limits of our collaboration and collective imagination. And, sometimes, I even like to experiment with new technologies for the pure joy of the experience in and of itself.

This wide-ranging journey over the past decades has taught me many lessons, but one stands above all else: the magic lies neither in the technical tools we build nor in the people who use them, but in the careful design of how those two come together. In other words, technology is neither just a tool (i.e. tech instrumentalism) nor is it a purely inevitable force that shapes our society and culture (i.e. tech determinism), but rather ‘a medium through which we perceive and manipulate our world’ (Cennyd Bowles).

Suptech is more than sup + tech

In holding this belief closely as my career led me through the financial sectors of many jurisdictions around the world, I have been fortunate to have played a role in launching many truly heartening examples of technology empowering otherwise vulnerable end users of financial products. However, I have also seen tools touted as empowering, but that through careless technical design and architecture actually brought net negative impact to the world via unintended consequences and externalities or were otherwise left vulnerable to bad actors who used them to prey on the already disenfranchised.

I jumped at virtually any opportunity to research, speak and actively work on this family of problems. In 2016, when my colleague Simone di Castri invited me to collaborate with him on building out the RegTech for Regulators Accelerator (R²A), I jumped at the opportunity to address these challenges by bringing together some of the tools and frameworks of the private sector in addressing the challenges of the public sector, and particularly those of financial authorities. Across the global community of these organisations, accounting for this double-edged nature of tech was already not only deeply recognised as a need but built into the ethos of our supervisory colleagues.

In collaboration with hundreds of supervisors across dozens of financial authorities, we have collaborated in breaking down departmental silos and exploring supervisory pains (‘What do you dread about coming to work in the morning?’) and gains (‘If you could snap your fingers and instantly change anything about your day, what would that be?’). We validated this ‘double-edged tech’ hypothesis and demonstrated that the very same tools digitalising the private sector and creating new supervisory risks could also be wielded by the supervisors themselves to mitigate these emerging challenges.

However, while the expertise of the supervisors and the novel technologies were each necessary ingredients, only a mindful approach to bringing them together would prove sufficient in creating valuable suptech solutions. To this end, we brought human-centred design (HCD) exercises to identify high-priority supervisory challenges (e.g. an inability to keep up with the volume of consumer complaints) and match them to novel technologies (e.g. mixed-language natural language processing models) in order to create terms of reference for global vendor competitions and develop suptech solutions (e.g. a “Taglish” chatbot to empower all Filipinos). The approach was demonstrated to be effective.

Scaling suptech via Cambridge SupTech Lab’s digital tools

Now, in early 2022, Simone and I and our team are hard at work building out the Cambridge SupTech Lab, a global supervisory innovation initiative at the Cambridge Centre for Alternative Finance (CCAF), expanding on both the successes of R²A and the community of individuals and organisations we collaborate with to co-create the future of financial supervision.

Among these efforts, inherent to the Cambridge SupTech Lab’s mission, is the decentralisation of expertise necessary to scope and build scalable suptech solutions. One component of this decentralisation is the transfer of frameworks and approaches to our community of Innovation Leaders via a structured curriculum and subsequent capstone projects. A second, equally important component is the transfer of knowledge and data via a set of digital tools, which serve to inform the context within which the curriculum’s approaches can be applied.

Personally, while my role within the suptech space has certainly evolved over the years, I generally continue to embody some combination of three main personas at any given time:

  1. Sherpa. In order to get a thorough understanding of the challenges, I guide interviews and diagnostic exercises and HCD to understand the existing processes, current state of digital infrastructure and priority areas for intervention.
  2. Translator. To evolve a common language and understanding of risks and opportunities in the face of capacity and resourcing gaps many financial authorities share, I de-hype and tame otherwise unwieldy jargon around emerging technologies.
  3. Advocate. To attract new talent to the space, to effectively match vendors with supervisors, and to foster growth of a global marketplace of solutions, it is necessary to build and maintain an active community, and I continually advocate for conversations and new connections across this network.

True to the mission of decentralising expertise, at the Cambridge SupTech Lab we are developing a digital toolkit that embodies the roles we have typically played as individuals. The toolkit’s six tools aid in the process of creation of cutting-edge suptech applications. We group them under three categories that align directly with my own roles listed above, and which I explain in more detail below:

1. Diagnostic tools support financial authorities in assessing the agency readiness for suptech, and the regulatory context (i.e. a digital sherpa).

2. Fintech intelligence supports financial authorities in understanding the anatomy of the fintech sector (i.e. a digital translator).

3. Marketplace development tools support financial authorities in becoming aware of the applications that are available off-the-shelf and those deployed by my peers, so I can make matches across the network (i.e. a digital advocate).

Diagnostic tools: X-ray vision

These tools give our Innovation Leaders the capabilities to develop X-ray vision through their institution, transparently sharing pain points and successes across otherwise siloed teams and processes to best inform prioritisation of strategic interventions, including the most appropriate areas for the introduction of suptech solutions.

Digital Diagnostic

As an Innovation Leader within a financial authority, I need to fully understand the pains and aspirations of supervisors across departmental and functional siloes, so I can identify priority areas that are most appropriate for addressal via suptech solutions. This involves a careful examination of digital infrastructure, data availability, manual and automated processes, and key roles across the organisation.

The Digital Diagnostic is a digital tool for financial authorities to map their use cases, applications, underling processes, data sources and data needs, and current and desired tech stack as inputs, and to receive as outputs a technical infrastructure diagram, process map and prioritisation of use cases.

RegSimple

As a financial regulator, I seek to quickly and thoroughly understand the latest trends in my peers’ approaches to regulating financial markets, so I can ensure I’m applying best practices in my own jurisdiction. However, manually parsing the full list of thousands of regulatory documents is unrealistically time-consuming, nearly to the point of the research being obsolete by the time it’s completed.

RegSimple, a tool built on top of the Cambridge Regulatory Genome, is a machine-readable regulatory benchmarking tool to simplify the comparison of regulations across different jurisdictions, analysing taxonomies and risks, and more.

Fintech intelligence: Expanded brainpower

These tools give the Cambridge SupTech Lab Innovation Leaders superpowers in the form of expanded brainpower, allowing them to hold and analyse extensive sets of information about their jurisdiction, calculating and developing deep insights and action points in mere seconds as opposed to weeks or months.

Global FinTech Ecosystem Atlas

As a financial authority, I want to understand the current state of the market(s) I am responsible for monitoring, analyse the distribution of business models at play and inform the creation of new frameworks to address novel risks presented by emerging technologies.

The FinTech Atlas is an online interactive resource to navigate the global evolution of fintech, and track entities and their activities across market segments and geographies over time.

Cambridge Alternative Finance Benchmark

As a financial authority, I want to keep my finger on the pulse of the rapid evolution of the fintech landscape, particularly in the face of massive disruptions such as the Covid-19 pandemic, so that I can adapt my frameworks to implications for market performance, regulatory needs and policy asks, and operational changes and implications.

In the Alternative Finance Benchmark, the CCAF has developed a comprehensive system to classify, in a consistent manner, providers of alternative financial services by their business model. The tool is aimed to unify and visualise the data collected by the CCAF’s Global Benchmarking Research Team, which since 2013 has been collecting global time-series data from fintech firms that undertake digital lending and capital raising activities, and has been designed to allow users to navigate the data and undertake analysis and comparisons between regions and business models.

Marketplace development: Telepathy

These tools give our Innovation Leaders a sort of telepathy, transmitting thoughts and experiences from the global community of providers and customers of suptech applications, to maximise the efficiency in developing solutions and the effectiveness of connections made across this network.

SupTech Solutions Tracker

As a financial authority seeking to modernise my supervision capabilities, I want to easily research what my peers have developed so I can understand the state of the art and build on their lessons learnt rather than investing in building from scratch.

The Solutions Tracker has been carefully designed to allow users to navigate our global inventory of suptech solutions by geography, risk framework, use case, technology, status, and more. Listings link to full reports for deeper research, project leads, outcomes, and more.

We strive for this tracker to remain up-to-date in the face of new suptech solutions regularly coming online. While our researchers are constantly monitoring the community for news on this front, it is always best to hear about solutions straight from the supervisors themselves. If you have a solution to share or would like to collaborate on, please make sure to let us know!

SupTech Vendors Database

As a financial authority with limited capacity and bandwidth to build in-house, I want to be connected to proven, world-class vendors of solutions so I can match their capabilities and off-the-shelf solutions to my internally diagnosed needs. As a vendor seeking clients for my applications, I want to share my capabilities with a community of prospective clients so they are aware of my offerings and can inquire as to how they can be tailored to suit their needs.

The Vendor Database is a dynamic, web-based tool to explore and connect with solution providers who have been active within the global suptech marketplace. Listings are filterable by geographies served, use cases and technologies, and include contact information and links to case studies to foster informed connections.

If you are a vendor who offers suptech solutions and you’re interested in being listed in our database, we’d love to hear from you! Please fill out our SupTech Vendor application form, and our team will be in touch on how we might collaborate.

Categories

Authors
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Cambridge SupTech Lab

Cambridge SupTech Lab

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Jose Miguel Mestanza Hirakata

Cambridge SupTech Lab

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Juliet Ongwae

Cambridge SupTech Lab

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Kalliopi Letsiou

Cambridge SupTech Lab

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Matt Grasser

Cambridge SupTech Lab

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Matt Grasser and Kalliopi Letsiou

Cambridge SupTech Lab

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Simone di Castri

Cambridge SupTech Lab

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