How Technology Helped in Keeping the Finance Industry Afloat During the Pandemic

For its first-ever online conference, Finastra, a leading provider of fintech software, explored various topics in the industry, including tackling financial inclusion, the impact of the pandemic on the fintech ecosystem and technology as a catalyst for open collaboration.

During his keynote address at Finastra Universe 2021, Eli Rosner, Chief Product and Technology Officer, Finastra, talked about how organisations were able to accelerate through disruptive changes during the pandemic and how technology provides the springboard into a new world of opportunity, especially in the financial sector.

“The world is facing a long road to recovery as it builds the economic consequences brought about by COVID and it's fair to say even without COVID-19, institutions have faced their fair share of crisis”, said Eli.

He mentioned that it has been a rough 12 years for the financial industry since the economic crisis of 2008. Add to that the acceleration of nimbler fintechs on the one hand and the rise of big banks on the other, who are now compounded with the pressure of near-zero interest rates amidst a global pandemic.

Through technology, however, banks and financial institutions were able to realise business continuity and even accelerate beyond the crisis-driven pandemic landscape. In fact, Eli said that the finance industry significantly outperformed their expectations and showed that they were agile enough to react at speed and scale strategic priorities.

“Technology has played and will continue to play a critical role in helping institutions mitigate the worst of the shocks and the way technology investments have played out over the last year mapped directly to the shift in priorities as the world copes with the pandemic”, added Eli.

More specifically, technology helped the finance industry across five phases in today’s economic situation. First, technology has enabled organisations to guarantee business continuity, move swiftly to remote working practices and utilise the cloud to accommodate digital service offerings.

The second one is ROI focus, where organisations are now hoping to leverage their technology investments today and beyond. Eli mentioned that at a time when it was estimated that 77% of banks would not have returned their cost of equity in 2020, technology again played out.

This includes various cost advantages in analytics that gave institutions a far broader view of their financial positions to plan accordingly and mitigate losses. The cloud has also become a topic in every discussion to reduce traditional on-premises costs and accelerate delivery cycles.

As the world braces for a recession, institutions need to focus on delivering operational efficiencies and find the right balance between hybrid, remote and physical operations. “Going forward, productivity is going to come under the microscope and having measurement mechanism based on data and insight that helps steer strategies will be crucial”, Eli added.

Data will also continue to flood machine-learning capabilities such as robotic process automation and create efficiencies through automation of back-end processes.

Heading into the next phase, acceleration, Eli said that institutions that transformed digitally will be in a position to accelerate innovation compared to those less digitally-enabled institutions for the most part. “We have seen several banks move quickly and decisively and continue to invest heavily throughout the crisis, particularly in digital cloud and platform and they do it with speed and agility”, Eli explained.

Finally, the innovation stage will see unprecedented levels of transformation in the adoption of business and distribution models that are coming to the forefront.

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