Digital transformation is impacting banks, financial services, and insurance companies (BSFIs). Advancements in artificial intelligence (AI), machine learning, mobile, robotics, and data-driven technologies are changing business fundamentals across these industries.
Rapid developments in smartphone technology have mostly replaced ATMs and physical branch units across developed nations while enabling establishments to provide services to the tens of millions of unbanked customers in developing parts of the world. Artificial intelligence and machine learning technologies are enabling organizations to do away with manual-led processes and infuse automation instead, thus reducing business costs and improving customer experiences.
Most importantly, new self-service-powered data integration solutions have transformed the way organizations use complex, bi-directional customer data to make decisions, deliver the value promised to customers, grow revenue.
When a firm fails to upgrade and rely on modern technologies like self-service integration or make changes to ride the wave of transformation, they suffer from multiple negative consequences, such as:
- Lower net promoter scores
- Higher customer attrition rates
- Delayed customer onboarding processes
- Underperforming technical or IT teams
- Higher customer acquisition costs
- Higher compliance costs
- Increased financial risk exposure from credit defaults
How Can Modern Solutions Enable BFSIs to Achieve Business Priorities?
BFSIs need to reimagine their ways of handling customer data using self-service-powered technologies.
These innovations and ongoing investments are critical to meeting the current challenges and unlocking new opportunities to achieve multiple business priorities, including:
Improved Customer Experience: BFSI personnel across the board can implement customer data connections and facilitate faster transactions to create delightful customer experiences. Customers no longer need to wait for weeks or months to get onboarded into the system. In fact, self-service integration solutions enable users to onboard customers in minutes. That, in turn, enables firms to connect with customers faster, evaluate their needs and expectations, and deliver the value promised to them sooner.
Better Wallet Share: Next-gen solutions like self-service data integration enable non-technical users (working in a firm) to leverage customer data without excessive technical interference. That enables technical teams to focus on developing innovative solutions, and other strategic tasks such as customizing pricing and facilitating product offerings. Consequently, firms are empowered to support cross-sell opportunities across existing business lines and from existing customers.
Comply with Regulations: Regulators pressurize companies to abide by existing regulations while adding new ones, from climate-impact reporting for ESG purposes, OFAC/AML/BSA, BCBS 239 to data privacyregulations, including GDPR. By leveraging modern data integration solutions, firms can empower their technical or IT teams to drive data governance, making them compliant with regulations.
Facilitate Innovation: When a firm relies on a self-service integration solution, its non-technical users come at the forefront and are geared up to drive data integration-related tasks, which were solely handled by IT earlier. Now, when IT need not manage the integration tedium single-handedly and implement custom coding or EDI mapping, they can focus on more strategic tasks, which enables firms to innovate and grow faster.
Better Risk Management: The objective of BFSIs is to manage and profit from risk. However, ongoing mergers and acquisitions (M&As) and disruption have made it difficult to identify, manage, and thwart systemic risk exposure. Self-service-powered solutions enable organizations to navigate the risk and drive value in challenging times.
Increased Business Agility: Business agility has become extremely important in the current digital era. With self-service integration platforms in place, organizations will become agile in responding to the market changes and changing customer expectations.
In short, banks, financial services, and the insurance industry must rely on modern data-driven technologies to make it easier to do business with customers, deliver the value promised to them sooner, and drive their digital transformation initiatives.