5. Banks will Rely on Digital Technology to Enhance Customer Experience
•Competition from Fintech firms and neo-banks forcing Banks adoption of digital technology to provide anytime, anywhere and any device services to customers.
•Technology adoption is leading to more customer interaction rather than transaction banking at the branch level.
•Reduced transaction costs as increasing no of customers would migrate to digital platforms.
•Analytics of transaction pattern will enable Banks to provide personalised services.
•With increasing smart mobile base, more services could be provided on mobile applications.
6. Banks adopting Modern Core Banking Solutions to Transform Legacy Systems
•Banks getting into transformation mode of legacy systems for competitive advantage and reduced TAT.
•Banks would contemplate Service Oriented Architecture (SOA), which will help them taking up multiple small integration projects involving reasonable investments.
•Selective customization might necessitate progressing simplification.
•Depending upon the size, Banks will adopt transformation strategy for resource requirements and the perceived benefits.
•Disruptive Technologies for traditional concepts of process flexibility, insights, costs and timing market will transform Bank’s architecture.
7. Banks and Non-Banks are concentrating on Decentralized systems as Transformation Opportunity
•Decentralized Technology will eliminate need to manage multiple database and reconciliation structure and transparency enhancement.
•Decentralised Technology underlying many digital currencies could lead to a paradigm shift in the Financial Services Industry.
•Decentralization could cause deverticalization and increase participation of smaller Banks with limited capital.
•Banks could make use of decentralized technology with SMS to help manager and authenticate transactions.
•Decentralized Transaction processing could be easily transferred to Cloud, which could reduce dependencies on use of mainframes and private data centres.
8. Banks are Working to Fully Integrate Risk Management and Compliance Practices
•Banks are extending their focus beyond improving specific processes to also integrate risk management and compliance.
•BASEL III increasing Capital and Liquidity Requirements for Banks.
•Fintech firms, not governed by RBI, are proving tough competitors for Banks.
•Increased compliance forces Banks to adopt greater automation, as manual processes are costly, time consuming and error prone.
•Banks will have to move to proactive compliance rather than reactive one by assessing the impact of regulations before making decisions.
Keep watching this space for updates on Emerging Trends in Banking!
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