Financial Services Tech Trends in 2020

by | 22 Sep 2020 | Content & Experience, Management

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With increasingly blurred lines between banking and technology, traditional Banks are having to evolve quickly to keep up, in a landscape of complex digital challenges.

The opportunities to grow and retain business is reliant on banks tackling these challenges head-on, aligning themselves with customer demands and working on an agile basis in order to respond to the changing market.

Miguel Cardoso of CACI explores some of the challenges banks are currently facing in today’s data driven environment.

FINDING THE ROUTE ON THE FINTECH FREEWAY
While the actual profit for Fintech’s customer acquisition is yet to be truly seen (most new customers are low value and/or secondary accounts), we shouldn’t underestimate the nimble mindset of FinTech and its ability to shift in order to justify their valuations. This could mean they become low-cost versions of traditional banks, or that they could adopt the increasingly popular subscription model.

As customers begin to look in more detail at the provider they chose are also looking at how ethical the companies they purchase through are. So regardless of size, providers will have to add this to their offering in order to stay competitive over the coming year.

DISRUPTION AND DIGITAL TRANSFORMATION
Whether its mobile, blockchain or big data, digital transformation will be high on the agenda for CIOs and CDOs across financial services.

Banks need to have the tools in place to store, process and manage data in order to serve customers and meet regulatory requirements more efficiently.

Digital Transformation is by no means an easy task and to be successful means updates to the core ways the bank works – all while not interrupting the customer experience.

Each institution is likely to approach this slightly differently, and there is no one size fits all when it comes to digital transformation, however there are some fundamentals that need to be included when starting this process. You can read more about that here.

CRAFTING THE CUSTOMER EXPERIENCE
There’s no doubt about it – digital technology has transformed consumer habits.

From mobile apps to targeted content and products and machine learning, customers are now accustomed to their needs being anticipated and having immediate access to whatever they want.

A new, constantly connected customer expects a constantly connected company in order to provide a seamless customer experience.

This creates a risk for customer loyalty with the new market entrants that can compete for a customer base that is always looking for added value and the accessibility to change is a facilitator for this risk.

RISK, REGULATION AND CYBERSECURITY
With fraud and financial crimes on the increase, financial institutions are under increasing pressure to protect their data by both customers and regulators.

Customers expectations about the security of their data is at a record high levels, the trust a bank now gets from customers is no longer given away as freely as it once was. The knock-on effect of this is a pressure to add more security to data and the channels the data is passed through using different security techniques.

As cyber security incidents become a more regular occurrence across the industry, the message that no one is immune is hitting home. This means businesses need to understand what to do in the event of an incident where they experience a data breach or other security incident.

Add to this the regulations and recent regulatory reforms in place (Basel III), all aimed at improving risk management for the banking sector, but not without their serious consequences for non-compliance by way of rather weighty fines.

WHAT FIRST?
One thing is for certain, there are some big challenges and opportunities in front of financial services institutions, and data teams are facing some of the biggest challenges the industry has seen.

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