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Twenty-two

Manu Peleteiro - Inbest

More personal financial planning    …

Manu Peleteiro - Inbest

More personal financial planning

Open Banking will transform financial planning, allowing consumers to access their own banking data so they can understand the state of their current finances and manage their money all the way into retirement. Manu Peleteiro, CEO of Inbest, has developed a digital platform which enables financial advisors to automate the complicated, time-consuming business of gathering and analysing all of this financial data – saving everyone money and making his business a promising prospect for future investors...

When someone says they have developed a new kind of platform to automate a complicated process in business, the first reaction often is that this will put machines in charge and make human beings redundant. But Manu Peleteiro has a radical solution for financial planning which automates the “boring bits” and could make financial advisors more human, allowing them to focus on the personal long-term requirements of clients, while the “robots” crunch the numbers.

According to Peleteiro, it can take three to five hours to aggregate and analyse an individual’s “big” financial data, and this makes it much more expensive to offer advice to a client with relatively limited assets. With wealthier clients, the data may be bigger and more complex, but the value add will also be significantly greater. Because it cuts the costs for everyone by automating all the time-consuming processes, Peleteiro describes his solution as the “democratisation” of financial management, using a digital platform called Inbest.ai which takes advantage of the latest advances in data analytics “to provide a holistic, personal and realistic financial planning service.”

Peleteiro also thinks the benefits of Inbest.ai are a win–win situation for consumers and professionals: “Inbest helps customers feel confident about their financial decisions and helps their financial advisors build stronger customer relationships by focusing on the emotional aspects of financial planning, at the same time as delivering a premium service.” Intelligent technology will always be important in providing financial advice, but psychology and social science also play a major role, along with professional training – in other words, we still need human beings on the job.

Open Banking

Apart from its intelligent technology, the key to the success of Peleteiro's new product is the recent change in banking regulations which gives consumers access to their own financial data – what is called Open Banking. This “disruptive” regulation also allows you to give your financial advisor or service provider permission to access your data – as long as they are regulated by the relevant government organisation, which in the UK is the FCA (Financial Conduct Authority) and meet the relevant security requirements. Unrestricted access to all your “big data” makes it easier to understand your situation better and help you reach your long-term goals in tune with your personal needs and desires, including attitude to risk. “Open banking will be a major force improving financial health,” says Peleteiro, who also believes it's important to deliver the financial data in a simple, friendly and jargon-free format. Similarly, giving permission to access your personal data will also have an impact on the future of healthcare, enabling anonymised medical records to be used in research.

In simple terms, if you use Internet banking, you can provide a link to any trusted organisation, so they can look at all your transactions and balances, pension funds and investments, etc. This makes your financial situation transparent to any advisor, making it easier to manage and plan your finances, based on your actual behaviour and real facts and figures – rather than what you declare. For example, you may be repaying a loan, saving for a holiday or buying a pension. When you fill in a form, you may forget these individual transactions, but Inbest misses none of this detail, so outside advisors can see the whole picture.

“Our experience with Open Banking gives the UK and Scotland the edge,” Peleteiro believes. “We are probably two years ahead of the rest of the world, and our financial culture and regulatory framework are also big advantages – especially the emphasis on defending the rights of consumers.”

Inbest aims to build on this strategic advantage: “Scotland is a centre of excellence in Open Banking,” Peleteiro explains, “and we want to export that excellence to other countries in Europe.”

The road to Scotland

Peleteiro came to Scotland in 2012 when he was offered a job in Edinburgh by Moody's Analytics, a New York-based consultancy which provides economic research, focusing on risk, performance and financial modelling. Among his clients then were RBS and Scottish Widows, and when he decided to “emancipate” himself from the world of employment and start his own business, they hired him as a consultant. Peleteiro also studied at the Institute and Faculty of Actuaries in Edinburgh from 2013 to 2015.

Prior to this, Peleteiro was a quant analyst at Accenture, based in Madrid, and an equity analyst for BPI, based in Spain and Portugal, after gaining a BSc in economics and finance, followed by an MSc in financial mathematics, at the Esade Business School in Barcelona, where he studied from 2003 to 2008.

Inbest was founded in 2014, with a mission to develop a digital platform to help consumers understand their own finances so they could make better financial decisions. Right from the beginning, Peleteiro also wanted to collaborate with academic researchers interested in data analytics and user interface design.

Two years later, Interface (a networking organisation which connects academic researchers with business), introduced Peleteiro to Edinburgh Napier University, who helped him apply for an RSE Enterprise Fellowship, so he could focus on developing his business while receiving one year’s salary plus mentorship and monthly training. Working with Dr Roberto Rossi, Director of Post Graduate Programmes at the University of Edinburgh Business School, and his colleague, Dr Raffaella Calabrese, Peleteiro also studied models which incorporate
socio-economic indicators to analyse people’s financial wellbeing, then later won funding from The Data Lab to look in greater depth at banking data, to develop a system to offer financial advice, including taking account of people’s “rainy day” savings and spending, automatically able to adapt to changes in market or user conditions. Another project studied the anonymised data of 200,000 customers, seeking to extract any relevant trends – the kind of work which large employers could do for their staff. Inbest has also won support from Scottish Enterprise and Scottish Development International, who recognise the company’s export potential and value what it offers to researchers.

Collaboration is a cornerstone of Peleteiro’s business philosophy: “I am delighted to collaborate with world-class academics in behavioural finance, financial mathematics and machine learning to alleviate a problem faced by consumers all over the world. We need to collaborate to develop content, product and services that make personal finances simpler and more accessible.”

Raising investment

Peleteiro aims to raise investment for Inbest by the end of the year to fund his expansion in Edinburgh, London and Madrid – strengthening his sales team and hiring more developers in Scotland and Spain. His current team consists of two developers and a data scientist, based in Edinburgh, and a sales director based in Madrid, and salaries account for the majority of costs – especially in Scotland where there's fierce competition for talent.

Investment will be welcome, but is not yet a priority for Peleteiro. “First, we have to ship the product,” he explains, “and demonstrate its value. We are currently working with two major banks, and this will be key to our future success.”

Banks do not tend to make decisions very quickly when it comes to implementing new technology. Inbest has to join the “product queue” with many other companies and win support from many different stakeholders before any project can even begin. But Peleteiro is confident both projects will deliver on schedule, and that the product will scale. Then investors will hopefully follow...

Lessons

So what has Peleteiro learned since setting up his business? “I've learned a lot about myself,” he answers, “including the fact I can be very stubborn.” Apart from putting in long hours, he's also learned he needs to be more flexible with working arrangements, dividing his time between Scotland and Spain, and anticipates this will continue to be the case over the next few years.

As well as learning how to run a business, Peleteiro also thinks that everyone needs to be taught more about money matters, starting in primary school, through adolescence, early adulthood, midlife and onto retirement – talking more openly and ending the “taboo” about personal finance. “Schools, universities, companies and local communities should also encourage financial education,” he adds.

Peleteiro has described himself as “a Fintech entrepreneur on a mission to democratise access to wealth management;” but for now, he is focused on proving the value of Inbest and looking after clients in the UK and Spain, so Inbest can become the go-to company for financial planning technology – and attract investment – by delivering concrete results.


What is Inbest.ai?

Inbest is a data analytics platform designed to “democratise” access to financial management by automating the financial planning process – gathering and analysing customer data so financial advisors can provide “more personal and realistic financial advice.”

The platform offers solutions for each stage of the customer lifecycle, including savings, retirement planning and pensions, plus an API for financial service providers to build their own custom solutions and workflows. It aggregates banking, investment and pension accounts, then categorises the data and analyses the financial status quo, keeping in mind lifestyle and investment goals, including the affordability of financial products.

There are three different modules, packaged for professionals and enterprise users, focusing on:
• financial situation
• financial planning
• tax planning

 

 

 

 

 

 

 

"Manu Peleteiro - Inbest". Science Scotland (Issue Twenty-two)
Printed from http://www.sciencescotland.org/feature.php?id=338 on 26/09/18 11:26:17 AM

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