The year of 2018 saw major groundbreaking technology introduced in the banking sector.
As the attention shifted from consumer centric to consumer friendly, we saw new features developed to improve processes, increase efficiency and close physical gaps. Banks are adopting technology to digitise every aspect of operations in order to stay ahead. The consumers demand better processes which cut down manual labour and increase profits in return. To address evolving requirements the key players are now dedicatedly working on improvements.
It’s a very sensitive time for banks to start investing on technology and optimising their legacy infrastructure.
2019 just might see that in action. Here we will discuss some major trends which will define the new year for banks.
Since the dawn of blockchain technology, it has often been alluded as Banking industry’s #1 enemy. The critics during the earlier years after its launch notably argued that the building framework will disrupt traditional banking. However, since 2016, shockingly more and financial institutions are adopting distributed ledgers on their platforms. This is being done due to the sophistication of processes and how well it adjust with the demands of the consumers. Since the financial ecosystem has gone digital and currently in a flurry of changes and newer technology, it proves to be an excellent time for Banks to get their feet wet. The Global Fintech Report states that 77% of Financial Institutes expect to adopt Blockchain technology by 2020 as part of their operations. Big names like JP Morgan Chase are already putting their faith in blockchain. Bank of America has recently filed a patent which discusses record keeping and individual verification via a blockchain built medium.
Bigger Big data
Banks are going digital in every which way except maybe ATMs where you can withdraw cash. However, even that leaves behind numbers, data. The chunk of data that banks handle on a daily basis is enormous and is increasing with every passing day. Thanks to big data, banks can now drive results and insights by data crunching and analytics. This helps improve processes and increase scalability. Intelligence tools are capable of handling metric tons of queries at the same time and provide with accurate and to the point results. By applying the logic for the purpose of risk management and threat identification; the security measures can be enhanced. Manual errors can reduce to a minimum and better insights can be generated for accuracy of processes. By using Big Data analytics; banks can personalise services for individuals to better adapt to their demands. This year the approach towards Big data in banking will bring immense innovation with it.
Fintech and Banks – Hand in Hand
Financial Technology is a well established phenomenon by now. The age of manual procedures are now replaced by as much digitisation as possible and the process is still an ongoing one. Fintech institutions are largely about “innovation”, and “open processes”. Banks have established their processes with an age long of expertise in terms of not only operations but their corporate nature as well. Admittedly it is not easy to change all of this overnight but it requires time to get used to trends. Moreover, the regulatory bodies, and compliance currently largely favour traditional banking procedures. Since 2018, this concept is evolving and e-payments, online processes, and such are gaining footing with legal sanctions behind them.The execution of innovative processes face difficulty but with the help of Big Data analytics and Artificial Intelligence Banks can now easily achieve it.
Innovation – Moving Forward
As global operations are moving toward more user friendly operations and digitising themselves to stay ahead of the game; Banks now are facing high stakes in order to introduce more and better experiences. Major banks across the world are now recognising that the need to innovate is greater than ever as the world is moving on a fast pace and in order to stay ahead of the game features and products need to be introduced which can attract the attention of consumers. It is need of the hour as Banks are not anymore providing just a service. With the induction of e-processes and blockchain into the overall digital picture, the need to innovate is greater than ever. 2019 will see a great degree of new products, and application launched to improve the experience of banking processes.
Optimising Digital Payments
In 2018, we saw a boom in the market when it comes to online banking and digital payments processes. Due to the hassle free nature, and use friendliness, P2P lending platforms and electronic wallets (crypto and non crypto) transformed the way of usual banking and business operations. The traditional banks faced stiff competition from the new entrants in the payments arena and brought with them a myriad of new technologies and services with no signs of slowing anytime soon. The demand of better experiences grew hence it put pressure in return on banks to optimise how they share, gather, and provide. In order to retain and regain customers Banks are required to introduce more options for self service, easy payments, mobile solutions for which consequently they need to innovate.
Artificial Intelligence that is Humane
AI has long since been introduced the Banking sector for fraud prevention measures and customer oriented services. Bank of America’s verbal AI bot Erica has become something of a phenomenon. Right now the developers are working on to enhance the “human skills” of the AI machine so that “Did you know you spent $50 on Starbucks last week?!” to maybe “Hey, your last week’s Starbuck’s expenses are $50.” Arguably, this technique was adopted from Apple’s Siri and Window’s Cortana but Banks are now trying to understand how to replicate it into not only for customer advice. The practical applications are now extended to the form of task advise as in “How may I assist you?”. This approach will change the course of how banks usually operate.
That’s it for now but let’s see what this year brings with itself.