Following the news about Playtech (LON:PTEC) dropping the acquisition of AvaTrade and Plus500 amid regulatory hurdles, Finance Magnates has learned that the company is taking some restructuring measures in-house. The current operational structure of the company’s financial business is getting a revamp alongside client on-boarding procedures.
Earlier this year, Playtech acquired Cyprus based FXTrade, which has been operating the Markets.com brand. Coincidentally or not, the gaming company has decided to revamp the modus operandi of the retail forex and CFDs brokerage to make it more competitive in a market which is increasingly relying on technological advances.
Finance Magnates has learned that the sales departments in the firm's offices in Israel and Bulgaria have been reshaped. The broker is re-focusing its resources on automation of client on-boarding and client retention while limiting direct customer facing relationships.
Our strategy has been focused on developing Markets' own technology
Commenting on the matter, a Playtech spokesperson stated to Finance Magnates: "Our strategy has been focused on developing Markets' own technology and the natural evolution of the business toward becoming its key offering to customers. As part of the delivery of that strategy, and as the product evolves over time, we divert gradually to more automated onboarding processes, which enable us to focus and strengthen our retention team."
"We have significant capabilities supported by our unique CRM technology being a key differentiator in the space. Our Bulgarian business continues to operate as before, focusing on back office services, education and customer support, and hasn’t been affected by this process, and Markets’ Israeli subsidiary is operating, and as before focuses mostly on software development, Analytics and online marketing," the official response concluded.
we are diverting to more automated onboarding processes, which enable us to focus and strengthen our retention team
The focus on automation comes as online firms across numerous industries have have been adopting technology to track customer conversions. Unifying reporting from referral sources and website tracking, online companies are able to analyze the most cost effective campaigns for marketing and ongoing engagement. The result is greater efficiency in on-boarding customers and less reliance on direct pre-sales calls.
KYC changes
Also part of the restructuring, the company is also initiating new on-boarding processes as part of its know-your-customer (KYC) procedures in order to match the expectations of various regulators. Put in place in 2016, deposits via credit and debit cards and bank transfers will have to be accompanied with a proof of ownership.
For card Payments , customers will be required to send clear copies of both sides of a client’s bank card before payments can be processed and deposited into their trading account. Although this practice has been widely adopted among regulated brokers, especially in the UK, some firms allow customers to initiate first deposits for limited amounts without full card verification.
With the purchase of TradeFX, alongside the Markets.com brand, Playtech (LON:PTEC) has also acquired an FCA regulated subsidiary named Epsilon Finance.
In Playtech's most recent conference call, it was stated: "The plan for the future, which is right now being established, is to be in a position where UK customers are being on-boarded under the FCA, where the remainder of the customers are on-boarded onto the CySEC license". As such, the new KYC procedures may also be part of the broker to unify its on-boarding procedures to meet requirements across all of their licensing jurisdictions.
End of Finexo
In other news, Playtech has chosen to consolidate its trading brands and has shut down the Finexo brand as of this week. Acquired in 2010, Finexo customers have been transferred to Markets.com. Prior to the transfer, both trading brands had operated under the same Cyprus regulatory license, SafeCap Investments, with little to no changes expected for Finexo clients.
