Is the end of FX sales teams nigh, as traditional calls make way for new fintech solutions?
No pressure on Forex brokers’ clients and lower costs for companies are amid the targets of OSYSTEMS’ latest solution, Jonathan Frankenstein and Martins Skromans say.
Cyprus has been enjoying a transformation from an FX brokers’ hub to a center for financial technology innovation. That is why, it comes as no surprise that fintech companies there face the big questions about the future of the industry and the changes that artificial intelligence (AI) solutions present to the technology and FX sectors. Are AI programs about to replace human staff in Forex companies? How does technology reshape certain Forex services? How can automation help FX brokers improve the experience for their customers and enhance regulatory compliance?
FinanceFeeds has recently sat down with Jonathan Frankenstein and Martins Skromans from OSYSTEMS to discuss these issues. The interview was taken at the Institute of Directors, where the latest FinanceFeeds London Cup event welcomed top-level industry executives.
We started by asking Mr Frankenstein and Mr Skromans about how (if at all) automation is helping Forex companies boost efficiency in terms of costs.
Both Mr Frankenstein and Mr Skromans agreed that the main goals of OSYSTEMS’ new solution OSYSFX are to reduce costs and increase engagement, with the first big problem that the new platform seeking to solve being low conversion rates.
“We build in-sale funnels that make the conversion process much more easier. We try to create a relationship between the broker and the client. We incentivize the clients so that they can actually come and see the trading conditions on a real account without any obligation, make a conscious decision without being pressured in one way or another to give their money”, Mr Skromans explained.
Mr Frankenstein told us about a test performed with a standard registration page and with a page where the prospective client just enters an email – OSYSTEMS saw a difference of about 35% in favour of people registering when they just have to put their email. “Because there are none of those staff calling and nagging”, he said. Mr Skromans added that the platform sorts out the masses and gives the broker only the people who are interested to receive a call and to give those people the deserved attention.
This way, Mr Frankenstein said, the platform takes away all of the aggressive part from marketing. Basically, it operates as a freemium system.
The freemium system where customers don’t get a sales call and instead get to trade according to what their circumstances are and receive automated messages based on their trading behavior is a good way to avoid the high-pressure sales approach, which leads to customer complaints and problems with regulators.
Next, we asked about the way forward for FX brokers in terms of targeting potential customers. Both Mr Frankenstein and Mr Skromans agreed that the current situation is radically different from what it was some 10 years ago, when people were not utilizing the Internet that often and needed explanation about what an account or Forex was. “Ten-twelve years ago, people did not know what an account or what Forex was, so they needed that call and they were waiting for that manager to assist them. Nowadays, people use phones on a regular basis”, Mr Skromans said.
This trend of using mobile gadgets and chat applications to tap into the Forex world is indeed dominant in many markets, especially in China, a critical market for the FX industry. As FinanceFeeds has reported, everything FX is done via messaging on the phone and chat in China. No one calls anybody. Even big IBs there don’t call their customers. So, that is the way forward.
Regarding the issue of costs, Mr Skromans stressed that OSYSFX is a solution compatible with MT4.
“A beautiful part about OSYSTEMS’ solution is that it allows improvement of brokerages’ existing systems. As long as they have MT4, the solution goes on top of it. This is cost-efficient, as brokerages do not need big investments to bring their operations to the 21st century”, he said.
Of course, we could not skip the question about the future of FX sales teams and the possibility of human staff being replaced by AI solutions.
Mr Skromans said: “No. We are not at the point where machines can replace people. I still buy my bread at the local bakery because I love the relationship. What the software does is help to build a relationship – if the client needs an account manager, he will always be there. He is not going to be pushing himself on the client, however”.
“People still need attention and that one-to-one relationship”, Mr Frankenstein concluded.