Financial data is as inherently interesting as it is illustrative. When examined en-mass, it offers profound insights: what knock-on effects various events and factors, such as economic downturns, have on peoples’ financial situations, for example.

However, considering the highly sensitive nature of financial data, it’s largely been locked away by those for whom financial data is a byproduct of everyday business — not least banks, whose products and services enable the public to receive, store, and use money.

In a concerted effort for the data to be used to drive positive impacts across society, outside organisations have increasingly gained access to the stowed away information. And for Scottish not-for-profit Smart Data Foundry, collaborating with financial institutions and partners in this manner helps it to meet its unique, inspirational mission.

DIGIT recently sat down with Smart Data Foundry’s head of data insights, Rui Cardoso, as well as its head of marketing, Richard Seabrook. We dug into what prompted the organisation’s founding, learned more about the milestones in its journey thus far, and discovered how, exactly, it’s unlocking the power of financial data for positive change.

All Change Starts Somewhere

Smart Data Foundry’s founding is, at least partly, owed to the recent evolution of the UK’s finance and banking sector. In early 2018 — and as part of a bid to spur innovation, known as Open Banking — new legislation came into force that ushered large financial institutions to securely share data with approved organisations.

Amid this change, Stephen Ingledew (chairman, Fintech Scotland), Gavin Littlejohn (founder, Financial Data and Technology Association), and Kevin Collins (assistant principal, University of Edinburgh) spotted an opportunity for the incoming data to be leveraged for societal benefit. As Seabrook explained, “The idea was that there was so much value locked up in financial data, and if that data and corresponding value could be unlocked for public good, that would be an incredible thing to do.”

However, before its official founding, the co-founders-to-be began applying for the funding needed to properly kickstart the organisation’s mission-led efforts. During this process, they received assistance from a team from Data-Driven Innovation, a University of Edinburgh initiative working to bolster the data credentials and capabilities of south east Scotland.

As a result, in August 2020, the considerable sum of £23 million was granted via UKRI — the UK government body for providing research and innovation funding. As Seabrook said succinctly, “We put together a very compelling bid to UKRI’s Strength in Places Fund that got us going with seed funding to last over a five-year period.”

In September of the same year, another significant milestone was achieved: a data sharing agreement with the NatWest Group, whose banks include NatWest and Royal Bank of Scotland. This then prompted Smart Data Foundry’s official founding, as well as its first projects, with one in particular cited by Seabrook as indicative of how it facilitates positive change.

Projects With Purpose

The project in question, and much like Smart Data Foundry’s founding, was inspired by an external event — though one not as positive. In light of the profound impact COVID-19 was having on society and the economy alike, the organisation decided to create an economic dashboard to garner insights into how people were earning, spending, and saving.

To facilitate the dashboard, and courtesy of the new agreement, the not-for-profit utilised de-identified data from a sample of over one million NatWest Group customers. Through the process of de-identification, which was carried out by NatWest Group’s team, the data no longer contained personal information — thereby protecting the individuals’ privacy.

While being used by Smart Data Foundry’s team of data scientists, the de-identified dataset was stored in a secure digital facility, known as a “Safe Haven.” The particular Safe Haven utilised by Smart Data Foundry for its projects is operated by the Edinburgh Parallel Computing Centre, based at the University of Edinburgh.

Once built, the insight-laden dashboard — which was regularly refreshed with new data — was then shared with the UK Government and devolved governments. It “gave them the tools to help make better policy decisions in terms of how to build back from the pandemic,” Seabrook said, enabling targeted support for the most impacted people.

For Seabrook, this particular early project speaks to the organisation’s ability to deliver against its purpose. “It was a really good example of how we were able to access previously inaccessible data as an unbiased, independent organisation, and present the hard facts of what was going on. In terms of unlocking the value of that data, creating impact, and being able to help improve people’s lives, then tick, tick, tick.”

A similarly representative example mentioned by Seabrook concerns a project from 2022: The UK Government’s Small Business Commissioner, Liz Barclay, had gotten in touch with the not-for-profit to research and investigate the impact of late invoice payments on small businesses.

“The general view was that small businesses were getting paid later and later, with the effects of Brexit and COVID making the situation worse,” recounted Seabrook. “But after looking at over 58 million invoices over an 11-year period, thanks to data from Sage [another of its data partners], it actually showed that the speed of invoice-to-payment had halved over the last decade, rather than got worse. It still showed there was a 40% cohort of people that continue to get paid late, but the overall situation had got significantly better.”

While the findings didn’t neatly align with the hypothesis that invoice payments were getting worse, it allowed Smart Data Foundry to instead present the truth of the matter. This then helped to positively reorient official efforts made to support small businesses. “It was great to go back to the Small Business Commissioner, to give her the tools to then go back to government and say: ‘Hey, there’s been real progress made here. But instead, these are the problems that we really need to tackle,’” said Seabrook.

These are but two instances of Smart Data Foundry’s purposeful work that was made possible through collaboration with data partners. It’s one of the organisation’s most recent projects that’s gained particular recognition and acclaim, however, not least from the new Scottish First Minister, Humza Yousaf.

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• FinTech Scotland and Smart Data Foundry Launch Innovation Challenge
• Smart Data Foundry Launch Open Banking Partnership and Tools
• Smart Data Foundry Appoints Inaugural Board

Supporting Scottish Councils

Smart Data Foundry’s Head of Data Insights, Rui Cardoso, is no stranger to the intersection of innovation and the public sector. Prior to joining the not-for-profit, he was a manager for CivTech — the Scottish Government programme helping to plug public sector firms’ problems through specifically-built, innovative solutions.

Cardoso’s tenure at CivTech gave him the “great opportunity of going around the public sector, and understanding the challenges they’re facing in terms of bringing in things like data and technology to help improve processes or make better decisions.” Joining Smart Data Foundry in June 2022, these experiences served him well for overseeing the project that was recently publicly praised by the First Minister: a cost-of-living dashboard for East Renfrewshire Council.

After the turmoil of COVID, and then the advent of the cost-of-living crisis, the local authority wanted to support its constituents’ financial lives more effectively, leaning on data to assist their efforts — something Smart Data Foundry could certainly help with. Following initial conversation, the not-for-profit embarked on a pilot project for and with East Renfrewshire Council.

“After many iterations, we came up with a map-based dashboard where we could overlay indicators and metrics from finance data,” Cardoso explained. “For example: the percentage of people within a specific area who are in financial distress, are consistently using their overdraft facilities, or have low disposable income.”

To deepen insights even further, demographic data from the council was also brought in. This means staff can not only see how certain areas are being financially impacted, but also the effect on specific groups within those areas, such as families with three or more children, or young mothers under the age of 19, without ever identifying the specific individuals within these groups. This level of granularity ultimately means the supportive measures taken forward can be as targeted as possible.

To ensure that the dashboard is both viable and valuable, the data underpinning it is refreshed every five weeks, thereby providing council members with the oversight needed to determine whether their measures are successful. As Cardoso described, “If there is an intervention made, we can then check back on it: Is it working? Do we need to go back and do more? Do we need to pivot what we’re doing to be more effective?”

The intrinsic benefits of being in possession of such a platform has meant that the dashboard has been fully adopted by East Renfrewshire Council. And off the back of it, we will likely see more dashboards like this — and other useful variants — coming out of Smart Data Foundry for the public sector. As Cardoso stated, “Things have rapidly evolved since we were able to demonstrate what we’ve been doing with East Renfrewshire. Now we’re having conversations at both a local and regional level.”

While the adoption of the dashboard and the interest it’s spurred are undoubtedly causes for celebration, Smart Data Foundry is by no means resting on its laurels. A dedication to its mission means the not-for-profit’s continuing to press on with new and impactful work.

Impact Is the Point

When asked about what’s currently in progress at Smart Data Foundry, one particularly noteworthy development that Seabrook touched on involves the marrying of two separate but wholly connected forms of data.

“Something that we’re actively pursuing at the moment is: How can we start to join up health data with financial data?,” Seabrook disclosed. “I think the combination of those two will create insights that will be unique in so many ways especially as, normally, those sensitive datasets never talk to each other.”

As he explained further, “You’d be able to unlock answers around the economic impact of Long COVID, for example. Or, better understand what comes first: Is it financial vulnerability that impacts mental health? Or is it mental health that impacts financial vulnerability?”

To help realise this, the not-for-profit is working with the Usher Institute — a University of Edinburgh medical research centre — to understand ways of safely putting those datasets together to reveal hidden insights.

The value that could be derived in this particular instance, and not least during a joint cost-of-living crisis and mental health crisis, could be remarkable — which is exactly why it’s being explored. Because, as was wholly clear from our interview, impact is the point for Smart Data Foundry.