Innovation Of banking

- July 21, 2019

NEW TECHNOLOGY IN THE BANKING INDUSTRY

The challenge for banks is now to facilitate demands that connect vendors with money through channels determined by the consumer. This dynamic shapes the basis of customer satisfaction, which can be nurtured with Customer Relationship Management (CRM) software. Therefore, CRM must be integrated into a digital banking system, since it provides means for banks to directly communicate with their customers.

There is a demand for end-to-end consistency and for services, optimized on convenience and user experience. The market provides cross platform front ends, enabling purchase decisions based on available technology such as mobile devices, with a desktop or Smart TV at home. In order for banks to meet consumer demands, they need to keep focusing on improving digital technology that provides agility, sociability and efficiency. Therefore,

Emerging Digital Solution

Emerging forms of digital banking are

BaaS - Banking as a Service (allows for third party integration)
BaaP - Banking as a Platform (for integrating core systems with software)
Cloud-based Infrastructure (allows less reliance on IT staff)
White Label Banking (such as co-branded credit cards)

These solutions build on enhanced technical architectures as well as different business models.

Banking companies are rapidly moving from traditional banking techniques to digital banking in order to enhance customer experience and stay competitive in the market.

Although retail companies in Europe are facing major challenges including increasing political volatility, new regulations, and persistent questions about the technological transformation of banking, the sector is expected to mark a positive growth in the next few years.

EIGHT TECHNOLOGY OF THE BANKING INDUSTRY

Using Data and AI for Personalization at Scale

When it comes to personalization, consumers are pretty clear what they want. They want recommendations that they wouldn’t have thought of themselves, and a clear direction about what they should buy when they are shopping for a product or service.

Voice-First Banking

Most financial organizations will move from basic dialogue and account inquiries to doing transactions using voice commands. This can include being able to execute payments using voice commands, as well as doing account transfers and establishing account alerts using voice commands

Open Banking

That said, an open banking platform future is within sight for financial organizations of all sizes. For instance, account aggregation is becoming much more commonplace, with firms like Citibank developing completely new digital-only products with this capability. Similarly, traditional bank.

Digital-Only Banks

Having a digital-only proposition may become increasingly important as more non-traditional banking choices are available to consumers today, enticing them to switch banks for better customized services and value propositions.

Cyber security

here is no doubt that the increased use of technology and digital channels have made the banking industry more susceptible to cyber-attacks and have forced banks and credit unions to be in the unenviable position of playing ‘catch up’. New open banking regulations that require banks to share customer information with third-party providers makes the industry even more vulnerable.

Now more than ever, banks must become proactive in their handling of data protection and managing cyber security risks. Unfortunately, consumers want the best of both worlds — ease of use and increased protection of data and identity. This will require the banking industry to implement multi-factor authentication, secure applications, digital signatures, and other forms of security such as bio-metrics.

Threat of Big Tech

Almost six in ten consumers who are looking to move to a new primary financial institution (or would consider doing so) are open to Big-Tech firms such as Google, Amazon, Facebook or Apple, according to a report from Novantas. This represents a 14-point increase over the 2017 survey, illustrating the potential impact of a major banking product introduction by any of the major tech companies.

One of the primary benefits traditional banks and credit unions had over their competition in the past was trust. Nobody wants to put their life savings at risk or to partner with an organization that wouldn’t protect their identity and privacy

Block-chain Tipping Point

For the most part, the focus of block chain implementations has been around cost reduction and process simplification. The adoption of block-chain in payments, remittances, provenance, and trace-ability are where block-chain technology seems to be used the most extensively currently.

Cloud-Based Solutions

Much of the momentum around cloud-based solutions is because any financial institution relying on a legacy infrastructure cannot compete against faster and more innovative digital competitors. Implementing cloud technology automates operations and workflows, resulting in increased efficiency, security and cost savings.

Whether banks go with a public or private cloud, security of data, identities, etc. is essential. And while cloud-based core banking may not be the biggest trend right now, banks and credit unions should consider this one of the most important technology trends in the future.