Do Financial Services Need To Reinvent Their Practices?
The rapid accelerations in technology are having an enormous impact on industries across the globe. From changing practices and becoming automated to increasing connectivity, there are a number of ways that technology is changing businesses. The financial services industry is no exception. In recent years, the sector has undergone a significant amount of change. One of the most significant ways this change is occurring is through the progression towards automated, robotic platforms. This change has reflected the changing in market demands, as a tech-savvy generation of clients becomes the latest group to require financial services.
There are a number of companies on the scene such as NEX that are helping financial organisations to prepare for the latest changes and challenges which arise due to advancements in technology. There are many tools and platforms available to help financial organisations to reinvent their practices. However, it’s debated whether or not this is necessary.
Around the world, businesses are having to rethink their strategies and upgrade their practices, or face being left behind. As new technology develops, financial organisations must be quick to adopt it. This is particularly important in an era where individuals have more power over their finances, due to decentralised cryptocurrencies, such as bitcoin, becoming more prevalent. Many international banks are taking steps to implement the latest technology.
Blockchain technology is one of the key areas which has been identified as an area for change. The technology has the potential to make international money transfers more affordable and more efficient. The technology has proved difficult to implement so far. There is a conflict of interest between the transparency of transactions, which is an essential component of blockchain technology, and the need for privacy.
These security concerns are the driving force of the counter-argument that financial services should reduce the rate at which they are changing their practices. There are significant doubts about whether the automated approach to banking is the securest way forwards. There is no doubt that cyber-crime attacks become more powerful and criminals are finding more intelligent ways to attack businesses.
In May 2017, the ransomware attack WannaCry hit organisations in over 100 countries in just 48 hours. The scale of disruption this caused raised concerns about a society where we rely upon interconnected technology for all aspects of our daily lives, not just operating businesses. Despite this, developments are being made to ensure that the latest technology is more secure than its predecessor.
Digital platform business models, which connect multiple buyers and sellers at once, are rapidly changing the way in which businesses operate. In the current digital economy, 83% of banks are said to consider platforms as a primary way of bringing organisations together. Digital platforms create partnerships between global companies, enabling them to work together and grow. Large financial service organisations who are beginning to utilise platform economy, will be able to deliver a more consistent and fulfilling customer experience.
The customer experience is increasingly important in this era, as expectations have changed rapidly over the past decade. An immediate, integrated experience is expected online and in physical spaces.