Setting Digital Banking Transformation Priorities During a Pandemic
16 September 2020
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Today, financial mobile applications and similar digital
platforms need to provide much more than simple banking processes like payments
and transactions, due to consumers’ high expectations and an increasingly
competitive e-banking industry. FIs already recognize that advanced
technologies like artificial intelligence (AI), machine learning (ML), applied
robotics, and biometrics are more and more relevant to deliver innovative
products and services that cater to consumers’ dynamic needs. These
ever-changing needs require solid prioritization by FIs in terms of investment
and shifting their budgets to the proper channels in hopes of overcoming the
competition and delivering what their customers expect.
A dramatic shift was shown in global priorities in the
banking sector post-COVID-19, pertaining to 2020 and into 2021. The actual
digital transformation stood out as a top priority for banks, with 75% of them
acknowledging that these dire times are in critical need for them to fully
switch their offerings to digital channels. This emphasizes that even
traditional FIs have increased awareness that digital is the way to go during a
global crisis; a fact that is even more amplified by the 51% of them that
believe that improving customer experiences is their second top-most priority. Customers
today are digitally savvy and have low tolerance for bad user experiences and
non-responsive customer service channels, so FIs need to step up their game in
providing fluid experiences that people of all ages can relate to. When
considering that organizations are always looking out for cutting costs and
minimizing risks, it’s hardly a surprise that, even after Coronavirus, they are
still holding both these aspects in high regard.
Source: The Financial Brand
It’s not enough to just find out what FIs think of digital
transformation in and of itself, it’s also critical to understand how they
perceive the importance of the transformation and the impact it will have on
different aspects of their business, and ultimately their clients. The shift to
digital has obvious enhancements to improving all customer experiences and
engagement metrics. Another obvious advantage to using advanced digital
technologies is the direction being taken by many FinTech companies and trendy
financial organizations today, which is implementing artificial intelligence,
machine learning and deep analytics in their offerings. These emerging
technologies have demonstrated tremendous potential over the last few years, witnessing
FIs putting these technologies as the second-most important area of
implementing digital transformation strategies today. Another key takeaway,
although financial organizations accept and are moving forward with
digitization, some of them are still reluctant to apply that change to their
overall business models as well as their legacy core systems. This indicates
that conventional legacy banks and FIs understandably value their core systems
as they are, but are simultaneously willing to go digital in other aspects of
their business. In that regard, the future could show them the benefits of
digital enough to convince them to transform their legacy system at some point
in time.
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