NewDay, new opportunity

SPONSORED INSIGHTS

FinTech Futures speaks to senior executives at NewDay, who obtained a highly commended award for Best Digital Initiative at the 20th Banking Technology Awards.

Building a technology platform from scratch may sound daunting but, as specialist financial services provider NewDay has discovered, it is also an opportunity to implement state-of-the-art technology and refocus to take advantage of new opportunities.

NewDay improved functionality by bringing digital acquisition and servicing in-house.

In 2017, NewDay was a leader in the UK credit card market providing products in the co-brand and near prime sectors to more than five million customers, partnering with some of the UK’s most established retailers.

Until then, outsourcing technology to a third party had been a key strategy in the growth of the company. NewDay saw the opportunity to improve functionality by bringing digital acquisition and servicing in-house, which in turn offered a multitude of benefits:

• Enhanced internal digital skills
• Rapid implementation of changes to the business model
• Reduced run and change costs
• An improved offering, including mobile apps for brands

The decision was therefore taken to create a world class digital engineering capability and build the best digital credit card platform available in the UK.

“We realised that our technology was not up to scratch and that we needed to own our customer-facing systems,” explains Bernhard Kainz, NewDay’s Director of IT and Digital. “Our immediate challenge was that we did not have any in-house engineering capacity, so over the last two and a half years we have built up our technology resources.”

In tandem with this commitment to in-house development the business has gone through some significant changes. “Digital technology has become a core component of the lending process and we have transitioned from being a credit card company and lender into having retail financing as a focus,” adds Kainz.

Kainz was brought into the company as Director of IT and Digital to manage the technology transition, which has leveraged the public cloud from the outset. “We have built a cloud-native platform underpinned by software development practices that allow us to rapidly create and deploy new features,” says Gavin Storey, head of digital engineering.

One of the main challenges NewDay faced during this period was getting the right people on board. “We only hired our first developer in September 2017 and bringing in the skills we need has been a strong focus, particularly as the business has also grown rapidly over that period,” says Head of Digital Change, Gareth Tupper. “The greenfield approach has enabled us to work with the latest technologies, which in turn has enabled us to attract top engineering talent.”

This growth has seen headcount increase from 1000 to more than 1200 and new account acquisitions rise to 1.2 million a year. NewDay now facilitates consumer expenditure of £5 billion across 107 million transactions.

“We were conscious that we were building the platform at the same time as recruiting the people we needed, so our engineers needed to hit the ground running,” says Tupper. “We also had to figure out how we wanted the development teams to work from scratch, so we are very proud of the progress we have made.”

The result is a unique customer experience platform for credit card with rich functionality and extensive multi-channel capability.

This platform supports all digital channels – web, mobile, conversational (chat) and voice recognition – as well as in-store, contact centre/back office and aggregators. Seventeen different brands run on the platform, which supports the complete lifecycle of a credit card from acquisition to servicing.

Security is paramount. The traditional security model is based on putting infrastructure into a controlled network environment and locking down access to this environment – the NewDay platform is based on globally distributed platform services and needed a security model based on different principles.

Being cloud-enabled has meant that the company is able to deliver agility and control in delivery execution; allowing it to measure, learn and adapt based on very granular data on delivery performance. The white label approach bundles common functionality into a customisable user interface, which means adding partners or brands can done quickly and adds little to the run cost of the platform since it is driven by usage rather than the number of brands or partners on it.

Customers have responded positively to the platform. NewDay’s NetEasy Score – which measures how easy customers find it to interact with an organisation – has risen consistently since the first quarter of 2019 and it has an average rating of 4.6 (out of 5) in the Apple Store.

The number of customer complaints for every 1000 active accounts fell from 1.25 in June 2017 to 0.76 in May 2019

“Building this platform has enabled us to massively increase our competitiveness in a constantly changing market,” concludes Kainz. “The next stage of our development will involve expanding the platform to other areas of the business, such as our back office functions. This insourcing approach will eventually extend across the entire company.”

By Paul Golding, senior staff writer, FinTech Futures

This article is also featured in the February 2020 issue of the Banking Technology magazine.

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