Barclays is collaborating with one of the graduates of its accelerator program to develop enhanced risk mitigation tools.
In an announcement sent to PYMNTS, Barclays reported a partnership with Simudyne, a graduate of the Barclays Accelerator, to test new risk mitigation solutions. Simudyne runs advanced simulation trials to reduce entities’ risk exposure.
Barclays has already been building simulations using Simudyne’s toolkit, the financial institution noted, using “agent-based modeling.” The simulation technology enables the automated recognition of a significant event in quantitative analysis, enabling entities to simulate more complex scenarios.
In its announcement, Barclays explained that agent-based modeling differs from regression-based models, which rely on historical behavior data analysis.
“By building agent-based models, we hope to spot and prepare for risks arising from dynamic and large, direct and contingent, counter-party exposures,” said Barclays Group Chief Risk Officer C.S. Venkatakrishnan in a statement. “This helps create a more robust and stable bank for our customers, clients and shareholders.”
“Agent-based modeling has opened up a number of opportunities for banks to test any decision before committing resources or taking any action in the physical world,” added Simudyne CEO and founder Justin Lyon in another statement. “Barclays’ decision to use simulation as a competitive advantage is just one expression of their focus on innovation.”
He added that Simudyne is working with Barclays’ Center of Excellence to explore additional functionalities of the risk management technology.
Simudyne participated in Barclays’ Accelerator program in London last year.
Earlier this year a report from Barclays and YouGov pegged the cost of fraud among small businesses at $55.7 billion and the loss of up to 50,000 jobs in the U.K. Its survey found 44 percent of SMBs said they had been targeted by some type of fraud, with more than a fifth reporting losses because of it.
“Fraudsters are targeting hardworking entrepreneurs, and in some cases impersonating suppliers and staff, intercepting emails and sending fake invoices,” said Barclays Business Banking chief executive Ian Rand in a statement at the time. “The staggering cost of these crimes can stop a small business from investing in new jobs, training or equipment, in turn boosting local economies.”