It is crystal gazing time and as COVID pandemic would indicate yearly predictions can be a risky exercise. 2020 saw forced changes across Industries and geographies. For cost optimizations retail banks embraced intelligent and leaner operational models by leveraging open ecosystems. Cloud migrations with their advantages of security, data analytics, and storage assisted banks to pursue digital transformations, revamp business models and accelerate innovation capabilities. Additionally, Banking as a Service (BaaS) is enabling banks to monetize their data, services and infrastructure as consumable API’s for third parties, and co-create new products with faster time to market.
Along with the megatrends that COVID accelerated, namely Digitization, workplace virtualization, Safety surveillance, Cost reduction focus and new-age ecosystems; here is a round-up of the top three technology focus areas in the Banking sector.
- Use of AI and Data for Hyper-personalization: Micro-segmenting as a digital strategy will underpin the shift from mass production to mass personalization. Banks that treat customers as segments by themselves will gain loyalty, increase lifetime value and reduce churn. 2021 will see banks ramping their data capabilities and advanced analytics to tailor real time financial recommendations. Surgical precision will permeate hyper-relevant content, hyper-specialized products, customized pricing.
- Green Banking: Expect this year to be an inflection point banks to focus on managing climate risks, adopting green operations, and developing green products. From motivating customers to opt for zero emission vehicles with clean-energy loans to zero processing fees on electric vehicles, to manufacturing cards from recycled plastic, and creating a corporate position for a chief sustainability officer; corporations world over are pursuing green banking to counter environmental and climate risks by incorporating them into their corporate governance.
- Voice Technologies and Autonomous finance: Technology trends, often, are driven by Gen Z habits. Present day voice assistants tell us everything from weather forecasts, stock market data, plays songs or offer road directions. In 2021, expect voice technologies to play a larger role in autonomous finance. They will reshape the way people interact with money and its service choices. From basic information, and account services, to using voice as one of biometric data security features, the ways of autonomous finance to power customer convenience will permeate daily banking processes. Banks will make serious progress with AI and ML managing user money across the vast portfolio of products and services.
In summary, 2021 will be a year of consolidation of all that the previous year accelerated – Digital banking, E Commerce, Contactless payments, AI advances in security etc.
In fact, as the year progresses, expect financial organizations to consolidate gains that have come from: Redefining the future of workforces and workplaces, humanizing digital experiences, and the neo-normal benchmarks set for Customer centricity.