Jayant Tandon is a seasoned banking professional and is presently heading the Newgen centre of excellence. He has 23 years of industry experience spread across a wide range of functions like product management, digital transformation, consulting, product strategy, global rollouts, operations, compliances, and intelligent customer engagement. Jayant started his career with one of the large universal banks with a global presence and has handled multiple national and international assignments.
Financial institutions have always stayed on top of modernisation—rapidly responding to changing customer expectations and adopting new technologies relatively quickly. However, the better part of 2020 has seen the financial services industry evolve significantly, and with unprecedented speed. No one could have predicted COVID-19 and its ramifications. Similarly, nobody could have anticipated the benefits it brought for the financial services industry in the form of accelerated digital transformation.
In the beginning, there were roadblocks…
Of course, there is no denying that COVID-19 has presented numerous hurdles and challenges to financial institutions, including:
- Limited in-person contact
- Remote working
- Disjointed and paper-based processes
- Increased risk
- Increased need for data security and reliable connections
But, in response to these challenges, financial institutions have risen to the occasion by expediting their digital transformation initiatives and implementing innovative solutions. In fact, according to Forbes, “The last six months alone have produced more digital transformation than the last decade.”
5 Initiatives to Respond to Pandemic Roadblocks
Here are five of the overarching solutions financial institutions have implemented in response to the unique challenges posed by the COVID-19 pandemic:
1. Redesigned and streamlined processes
The immediate need for remote working capabilities has driven financial institutions to digitise and optimise their operations. Many financial institutions have leveraged robust, cloud-based platforms to streamline their operations, automate manual processes, and enable remote access while ensuring data security
2. Modernised banking services with new-age technologies
According to Analytics Week, “the ability to observe, analyse, interpret, and catalogue the actions of your bank customers allows you to design and deliver rich, individualised experiences that will help build customer loyalty.” In order to retain a competitive edge, financial institutions are leveraging artificial intelligence, analytics, and insights to build predictive profiles of their customers in real-time, which they can use to deliver personalised services and recommendations. Additionally, financial institutions are modernising many of their services, including asset management, auto lending, and business line credit, to manage risk and ensure smarter decision making.
3. Increased usage of contactless payments
Contactless, or cashless, payments using QR codes, eWallets, or contactless cards, have taken the world by storm in response to the health concerns related to physical exposure. According to the Yale School of Management, “cashless supports for individuals offer speed, security, and availability that far outperform cash in combating the COVID-19 pandemic.” While the pandemic has drastically increased the use of contactless payments, it seems that contactless technologies are here to stay, especially as an extension of ongoing digital initiatives.
4. Increased prioritisation of financial wellbeing
The needs of modern banking customers have changed significantly as a result of the pandemic. Rather than focusing on investing or other risk-laden activities, customers are interested in securing their financial wellbeing. Financial institutions, in response, are shifting their approach—making conservative recommendations, democratising financial planning and wealth management services, and engaging customers in meaningful conversations about their finances
5. Optimised customer interactions
Since in-person interactions are now limited, and in-branch banking is on the back burner, financial institutions have started focusing on engaging with customers via digital channels. Furthermore, financial institutions have recognised the importance of identifying customers’ preferred channels, personalising interactions, and delivering a seamless customer journey, virtually and in-person.
Looking to the Future
While there is no clear end in sight for the pandemic, financial institutions have effectively adapted and are on track to future proof their operations. Thanks to rapid innovation and expedited digital transformation, financial institutions are not only surviving in the present, but they are also primed and ready to scale their processes and flexibly respond to any unprecedented circumstances in the long term.