Stephen Openshaw, CEO and Managing Director, Eiger Trading Advisors LTD
Stephen Openshaw, CEO and Managing Director, Eiger Trading Advisors LTD speaks about how the institution has stayed ahead of the tech trends.
editor's pickTuesday 06, November 2018
What is the Eiger Trading Platform and what does it do?
The Eiger Trading Platform (ETP) is fundamentally an online commodities trading platform that provides real-time Shari’ah-compliant support to Islamic financial transactions. Eiger was the first intermediary broker to bring technology to the commodity Murabahah services space with the launch of the ETP in 2009. Through the ETP, Eiger can provide various different commodities from around the world to its banking clients to support their commodity Murabahah transactions. Over the past decade, the ETP has evolved and continues to be the most technologically advanced and flexible Shari’ah-compliant commodity Murabahah trading platform on the market.
What was the initial mission of Eiger when it was founded, and has it evolved since then?
The origins of Eiger Trading began with the goal of creating a ‘green’ coffee fund that would invest in supply-chain and logistics in the coffee market right through from grower to roaster. The mission was to offer an ethical investment fund by 2008.
Unfortunately, the global financial crisis hit, and the fund wasn’t able to raise the target capital needed. The company wanted to retain an emphasis on green or ethical practices, so the company adapted towards environmental, social, and governance ideals. We took some time assessing the market, competitors, and participants, and identified a need within legacy operational communications which required a platform that could cater to commodity supply and documentation management.
With my experience working in Middle East, I joined the company in 2009 to help facilitate the development of a Shari’ah-compliant commodities trading platform. Nine years later we continue to be a leading fintech company in the Islamic finance industry and we are focused on further developing the ETP with our clients’ needs in mind. Our mission has changed slightly over the years although the goal of offering an ethical, Shari’ah-compliant product has always remained at the forefront of our strategy. We believe in driving technological innovation and making Murabahah available to everyone.
Do you see yourself as collaborative or disruptive?
I believe that Eiger is really both collaborator and disrupter. We brought huge levels of disruption to the status quo when we burst on the scene and the incumbent service providers could no longer continue to offer slow and manual services, utilising old technologies such as fax, which open the door to errors and processing bottlenecks. We have even spoken to banks that previously had to enforce significant lending limits due to the fact that their previous providers could not process transactions fast enough for their demands.
On the flip side, Eiger is also a collaborator as well, and we pride ourselves in offering bespoke services for our clients. We prefer to collaborate and work closely with our clients to deeply understand their needs and the pain-points in their existing processes. This allows us, in conjunction with our clients, to design a solution that alleviates processing bottlenecks and time or cost inefficiencies.
How have you stayed on the cutting edge of technology developments?
People. We have always had a keen focus on understanding where technology is going by assessing both the market and the future requirements of our clients because their needs drive our progression while also reinforcing Shari’ah principles. Therefore, I believe that it is about having the right people within the company with the passion and vision to drive innovation while being flexible and sensitive to our clients’ requirements. We are a people business and while technological innovation is crucial, it is people that drive that innovation.
How have you built your client base over the years?
We feel that it is exceptionally important that the growth in our client base is completed organically through face-to-face interactions. My team and I spend a lot of time travelling to the various countries where our clients are located, and I see this as vital in order to maintain relationships. As I mentioned previously, we are a people business and having that personal relationship with our clients is an important part of our business. Through this strategy, we have successfully built a reputation of being sensitive to our clients’ needs, efficient, responsive, adaptive, flexible and always acting with integrity.
What are your thoughts on the general landscape for Islamic tech? Do you think that institutions are aware of its importance?
Generally, we believe financial institutions operating in the Islamic finance industry are acutely aware of the importance of keeping up with modern banking technology in order to remain relevant. I read an article a few years ago that forecast that 50 per cent of the banks in existence today would disappear by 2050 because they will be unable to adapt to technological change.
Underlying customers demand cleaner more efficient services from their banks and financial institutions, and the industry overall recognises that technology will be essential to the evolution of meeting that demand. Technology will also make it easier to provide access to Shari’ah-compliant products and services which is why we will continue to innovate in this space to help support the needs of our clients.
What are the biggest challenges facing your institution, and what is your plan to overcome those challenges?
Our clients operate in a regulatory environment that is constantly evolving as market supervisors look to implement new regulatory frameworks to encourage better transparency and promote markets which are fair, efficient and orderly. Given that our clients are located across the globe and are under jurisdictions with differing interpretations of Shari’ah, we face challenges implementing the individual requirements of our clients.
To help us cater to this, our highly experienced in-house IT development team has designed the ETP so that it is adaptable, flexible and fully configurable to match the unique internal and external processes of our clients, as well as support multiple methods of integration to enable straight-through processing. Our development team is able to react quickly to produce fully tailored solutions which meet even the most diverse requirements.
What have been the major milestones for Eiger in 2018?
2018 has been an exciting year for Eiger with the addition of new staff into the business who bring with them experience in technology, marketing and sales, with the view to expand our product suite and develop our marketing strategy. We are also very proud of developing innovative solutions over the last year that is truly market leading.
One active example of a bespoke solution that we have developed is a retail banking client based in the GCC who needed Murabahah services integrated with the delivery of various online retail deposit and financing products. In the past 12 months, we have completed 12,000 transactions with this client which have helped deliver almost $500 million of real value to the lives of everyday individual banking customers.
What do you have planned for 2019?
Our vision is to become the leading provider of commodity Murabahah to Islamic financial institutions all across the world and with the introduction of new staff and a new marketing strategy we are building a platform to deliver on that vision through organic growth in the future. We also have new technology on the horizon that could make a significant impact to the industry and this will be a major focus next year.
Do you think the Islamic finance industry has a ‘social obligation’?
Absolutely and when looking to the future, I am confident that Eiger will play its part by utilising our technology to help give back to the global community. A fundamental part of Islamic business ethics is the idea that corporate social responsibility should be integrated within general business practice to support some of the needs of those less fortunate. This builds on industry discussions around ‘Ethical Banking’, differentiating the Islamic Finance industry from conventional finance as well as the core ideals around sharing within Islam.
We believe that the ETP can be used to support not-for-profit initiatives that help stimulate investment in projects that focus on helping the community especially in the less fortunate regions. We would be happy to work with organisations involved in supporting micro-financing initiatives to very small businesses that have difficulty accessing finance.
What is your personal management style?
I am fond of a quote from Steve Jobs that states, “it doesn’t make sense to hire smart people and tell them what to do. We hire smart people so they can tell us what to do”. I have a firm belief that by hiring good people with the right experience and attitude, I can let them get on with what they do best—innovate. Our ability as a business to be flexible, adaptable and reactive is born from removing barriers internally and empowering staff with the ability to make decisions.
As a small company with less than 20 people, I can remain close to the team at a personal level while giving them the space to deliver on our strategy. I am proud of my team and I know we have the right people in place to grow into the future.