Digital transformation has impacted industries across the board, from entertainment and retail to telecommunications and education. Another example is the multi-billion global financial services market, which is almost unrecognizable compared to how it once was. Tasks that were previously performed by humans can now be completed digitally, while technologies like blockchain, artificial intelligence, and machine learning are increasingly being incorporated into business models.
While we’ve seen rapid advancements in recent years, banks and other organizations will only continue to evolve — especially in light of the impact COVID-19 is sure to have on the industry going forward. Here, we highlight three technological solutions that are transforming global financial institutions.
Today’s consumers want international payments to feel similar to transferring money locally. “In our view, customers are seeking a seamless and transparent experience,” reads McKinsey’s A vision for the future of cross-border payments. “If people value real-time payments experiences domestically, there is reason to believe they will value them in an international context as well.” This includes “reliable payments delivery, access to preferred payments methods, and the ability to track exchange rates and schedule payments based on this info”. Therefore, financial institutions must offer cross-border payment services that meet these demands in order to retain customers and stay competitive.
These goals can be achieved by partnering with fintech, which aren’t burdened by legacy infrastructure costs and can concentrate exclusively on product and service delivery as a result. An excellent example of this is Danish fintech Inpay, ticking all the boxes with its cross-border payment products for financial institutions. International payments to over 100 countries are processed in just 30 minutes on average and can save financial institutions up to 80% on cross-border payment fees. As well as being low-cost, fast and secure, Inpay offers smooth and fully supported API integration under a single point of connection and can be seamlessly merged with existing UX/UI. Furthermore, international payment status can be tracked online using a customer web portal.
Salesforce Financial Services Cloud
Client and customer relationships are at the heart of the financial services industry, where forging deep, long-lasting relationships is vital. What’s more, requirements and expectations are different from what they once were. Thanks to factors like the rise of digital banks and the growing interest in data-driven open banking, customers desire convenience and personalization. “We believe that hyper-personalization is an imperative, not an option, in a digital economy,” Deloitte notes in its The future of retail banking paper. “The combination of smart devices, rapidly-evolving CX capabilities and real-time processing of big data, means that new opportunities arise for banks to meet customers’ needs on a highly-personalized and dynamic basis”.
Salesforce Financial Services Cloud (FSC) is a useful solution for financial institutions seeking to deliver this hyper-personalization. The dedicated customer relationship management (CRM) service consolidates data to provide a full customer view and help drive loyalty. Financial institutions gain access to customer profiles with insights enabling employees to identify new opportunities and convert more leads. These details mean organizations are better placed to meet their customers’ financial needs and build loyal, trusted relationships.
“Banks that make customers feel like most of their financial wellbeing needs are supported — often banks that get an assist from experts in customer behavior — will be well-rewarded in increased share of wallet, engagement, NPS scores, and revenue,” Gallup concludes in a survey on the topic. “And, in a tightly regulated industry, being the bank that makes customers feel cared for can be a lucrative competitive advantage.”
Virtually all industries can benefit from enterprise resource planning (ERP) software (the integrated management of main business processes), including financial institutions embracing digital transformation. “This isn’t just a matter of cosmetics. You’ll need to change your back-end operations to support it,” warns PwC. “And you’ll need to think differently about how to solve problems. Technology isn’t a silver bullet.” Whether it’s operations, finance and risk management, retail banking and loan management, or upscaling the payment methods and communications, there are plenty of areas where financial institutions need to be able to actively respond to change.
SAP S/4HANA is an all-in-one solution that can bring about such transformations, with embedded AI and machine learning to provide banking firms with industry best practices. This can integrate data into core business processes such as risk analysis and mitigation. For example, fraud and risk are significantly reduced thanks to real-time, automated processes like consistent risk profiling, flagging abnormalities, and trend, pattern and customer behavior analysis. SAP S/4HANA also has multi-bank connectivity, offering seamless integration to boost the customer-bank relationship. According to the company, its technology on average leads to 30% fewer processing errors and a 45% increase in revenue growth with information as a key strategic asset.
Written by Adam Eaton