Top 5 Digital Transformation Trends In Financial Services

Are you looking to digitally transform your financial services organization? You’re not alone. According to a recent study, 79 percent of financial services firms plan to undergo digital transformation in the next three years. But what does that mean for your business? And where should you start? In this blog post, we’ll take a look at some of the key trends driving digital transformation service in financeand offer tips on how to get started.

The financial services industry is known for its technological prowess and application of new technologies. But it’s also recognized for being resistant to change, particularly when it comes to adopting new business models or abandoning old ones.

However, the times are changing quickly. According to a study conducted by ACI Worldwide, 59 percent of financial institutions expect their firms’ revenues to increase as a result of digital transformation. More than half (51 percent) said that they believe their organizations will be better positioned to deliver an enhanced customer experience, and 51 percent anticipate greater operational efficiency as a direct result of digital transformation solutions.

“Digital is changing the concept of banking,” said Eric Piscini, global financial services blockchain leader at Deloitte. “The only way the bank of the future makes money is as a software company.”

In addition, 69 percent said that digital transformation will require them to evolve their core technology infrastructure, and 64 percent acknowledged it will affect their branch network. However, nearly three-quarters (74 percent) of those surveyed reported they have conducted no formal digital transformation planning.

While there are a multitude of efforts underway to transform financial services, what follows is a look at the top five trends slated to have the biggest impact on this industry over the next three years:

1. Cross-border payments

In recent months, there has been significant progress in how banks approach blockchain technology and its potential to create competitive advantages. The BOT model and Blockchain emerged as the top technology trend in terms of its ability to deliver value, according to a survey conducted by Greenwich Associates earlier this year.

“Blockchain has become the new buzzword,” said Tony Navin, executive vice president at Bankers United. “Banks are trialing it, banks are investing in it. But there are still a lot of questions; how do you make money off it? How does it work?”

That’s why financial institutions should focus on cross-border payments, particularly in relation to the global supply chain, said Navin. “Supply chains don’t stop at country borders,” he noted. “So why can’t we use the same technology and rails to move payments across country borders? It makes so much sense.”

2. Financing the global economy

Just as cross-border payments will become more essential, financing the global economy — in particular, small businesses around the world — will gain prominence as well and android app development for business plays important role too. Many banks are already gearing up by rolling out new financing products, developing new services on blockchain and providing flexible financing for SMBs.

“Next to supply chains, the second place where blockchain will have an impact is in small business,” said Navin. “Small businesses are the backbone of our economy.”

3. Expanding mobile technologies

As evidenced by mHITS’ rapid growth, there’s potential for mobile technologies to transform the banking industry, especially when it comes to marketing channels.

“It’s all about leveraging what you already have through mobile marketing, SMS messages and other things,” said Navin. “Banks are getting better at creating a tailored experience on your phone.”

In addition, there will be a greater emphasis on the customer experience, not just in terms of how it’s delivered but also what customers can do with it.

“The user interface will open up,” said Navi. “The customer is going to be able to interact with the whole stack — the core banking system through mobile and maybe wearables — and access all their financial services.”

4. Investing in new technology

Fintech has already had a significant impact on the financial services sector, and it will continue to do so. That’s why banks should invest more in innovation and incubate their own fintech solutions, rather than just partnering with these companies or acquiring them.

“Banks have been very good at using their customer data to improve the customer experience, but now they are focused on how to use the data for personalized offers,” said Piscini.

5. Embarking on digital transformation

According to Navin, most financial institutions are already investing in new technology and have been for quite some time, but they’re failing to embrace digital transformation services at the same time. “If you’re not investing in digitalization and transformation, then you’re going to get left behind,” he said.

My Final Words

These top five trends are slated to have the biggest impact on this industry over the next three years due to their ability to integrate technology with finance in ways that were not possible before. If you’re looking to stay ahead of the curve by embracing these innovations now, let our team help create a digital marketing plan tailored specifically for your needs — contact us today!