The business landscape has been experiencing changes year by year. The data revolution arguably began with the emphasis in digitalisation during the first wave of the Internet decades ago and then accelerated further with the rise of technologies such as cloud computing, 5G and Internet of Things more recently. All of these have led to today’s digital transformation era, wherein various industries undergo disruptive changes that are compelling them to keep up with the constant stream of data in the digital landscape.
The Financial Services Industry (FSI) is no exception to this. In fact, FSI organisations should be leading the way to digital transformation since many are relying on their services – loans, payments, investments – from ordinary individuals to large corporations and everyone in between. The unique thing about this particular industry is that it consists of long-serving financial institutions as well as modern, born-in-the-cloud fintech start-ups – both of which are now vying for the same areas of business and types of customers.
As such, for the older players especially, digital transformation is increasingly becoming a matter of survival – not only to stay ahead of the competition but also to become more agile and adaptive, able to operate effectively in today’s environment that is full of unprecedented challenges and complexities.
There are certainly challenges aplenty. According to the Institute of International Finance and Deloitte, investors of more mature FSIs tend to have a lower risk tolerance compared to investors of start-ups and fintech companies. Meaning, if a more established company decided to invest in digital transformation, investors may not respond as positively as they would, compared to more modern financial companies.
Even though traditional FSIs have access to a great amount of customer, transaction and other forms of data, many tend to struggle to create value with the wealth of information that they have at their disposal. This could either be due to the inability to capture the right data attributes for developing insightful analysis, to inconsistent approaches to balancing innovation and meeting the various regulations around data security, customer privacy and ethical use of data.
Speaking of regulations, one issue that regulatory bodies are having trouble keeping up with is the rapid pace of technological advancements. The report states that because the public policy, legislation and rulemaking processes still take a long time, regulations can become outdated or obsolete, especially if it is prescriptive or technology-specific. To make matters more complex, traditional banks may even face a different set of regulation and supervision compared to start-ups and fintech.
When it comes to the workforce, FSIs are now compelled to search for talents that are more digitally-enabled. As organisations transform, the need for talent that is versed in digital is becoming ever more important and as such, there is an increased demand for talent with data, design and technology knowledge combined with business savvy and a hands-on mindset.
These are but a few of the challenges facing today’s FSIs and there are more emerging technologies coming over the horizon that will change the data, digital and regulatory landscape even further. Think of 5G, IoT and edge computing, autonomous systems, quantum computing, augmented reality and more – these will all have an impact on how FSI organisations operate and deal with customers.
Overcoming these obstacles will be hard but far from impossible. Financial institutions will need to have the know-how, strategies, as well as solutions that will allow them to successfully modernise, transform and adapt to whatever changes that may come.
If you would like to learn more about how FSIs can unlock the true value of data, meet increasing customer and regulatory demand and overcome the challenges of today and the future, attend our upcoming webinar on the 27th November 2020.
We have invited experts from Silverlake and IBM who will discuss the essential ingredients that will enable organisations to transform and overcome obstacles in these unprecedented times. C-level executive from Silverlake Symmetri will also be sharing how they have successfully transformed and adapted to the new normal in a highly demanding and competitive financial industry. Do not miss this chance to hear from the CEO of Silverlake Symmetri, who will speak about the initiatives that the bank has undertaken to improve efficiencies, increase security and enhance financial innovation with the right strategies and technology.
To find out more and to register for this not-to-be-missed webinar, click here.