International banking has seen a significant transformation over the years, and the evolution is expected to continue well into the future. Today’s financial institutions are more focused on the customer because they are responsible for success in the financial sector. Basically, the name of the game is a customer experience that moves as smoothly as possible.
Giving customers more produces a whole new set of challenges for banks worldwide when it comes to creating long-term growth. This growth will allow the financial sector to continue to offer products and services that meet the needs of an always-evolving customer base. Banks must manage their talent in new ways, embrace innovation, and be willing to establish partnerships in the tech sector tothey need.
In the meantime, compliance is seeing a sort of “recalibration” because regulations must evolve with the changing landscape. Technology must also be better managed because solutions must be seamlessly integrated to avoid service disruption. With more technology comes increased cyber risk management, which leads to more decisions among big tech and fintech companies when it comes to establishing a balanced mix of competition and collaboration. As all of this happens, the international banking community is also forced to reimagine its employee base. Banks are seeing an increased need for more technologically savvy people to meet their goals, diversifying the workforce in the financial sector.
The industry is not like it once was, and it is transforming faster than ever. Below, you will read about some of the latest international banking trends and how they might influence you.
Fintech Is Disrupting the Industry
Fintech has been disruptive because it has pulled consumers away from traditional banking and toward a digital realm. The adoption of application programming interfaces (APIs) has been largely responsible for the impact on banks. The connection of applications, such as mobile apps, to banks’ back offices has been enhanced. It’s a technology that has already been used by the financial services industry for a while, but usage is expected to grow as traditional banks collaborate with fintech companies. Thereported that approximately 50 percent of Tier 1 and 2 banks would offer their customers at least five APIs by the end of 2018.
This migration toward a digital presence is important because more individuals and businesses want to instantly manage their accounts on their computers, tablets, and smartphones. This has resulted in apps being able to do more than show a balance. People can now transfer money between accounts, pay bills, initiate direct deposits, and much more.
Other predictions by the International Data Corporation regarding fintech include that 25 percent of banks will use micro-location in their marketing campaigns by 2020, mobile devices will be used to make approximately $6 trillion in P2P transactions by 2019, and corporate banks will invest over $2 billion in analytics and big data in 2018.
Artificial intelligence (AI) is another area that is transforming the financial sector., which is enhancing customer experience because of the improved efficiency. It’s becoming possible for banks to give loan applicants automated decisions and use data to make life easier for the customer. Everything from machine learning to how data is gathered is taking the human out of the equation and streamlining processes. AI is also much faster than humans, like having another employee without a physical body. This fact is what is driving down costs, which also benefits the customer.
Chatbots Are the New Customer Service
Chatbots are another form of AI that is being used more in theresults. Go to a website, complete a single application, and receive multiple loan offers. This is done by taking the information that you enter and organizing it to identify partner lenders that meet your needs and vice versa. Lenders have specific requirements, so the information you enter is used to identify which requirements you meet to be presented with offers specific to you.
This is a very intricate process so that the proper customer/lender matches can be made. This prevents customers from “wasting their time” with lenders that aren’t a good match.
Meta-application services are also used for such things as insurance quotes. They have been refined over the years to deliver more accurate results.
There are many challenges to be addressed because of customer demand, a quickly evolving fintech sector, banks that want to focus more on the customer, and the introduction to technologies that some banks are reluctant to embrace. Whether a financial institution is large or small, fintech, the blockchain, meta-application services, artificial intelligence, and chatbots are trends that are going to touch them all. By shifting from the traditional way of thinking to an agiler and more innovative mindset, banks can create partnerships that embrace technology. This is important since the consumer-based benefits also positively influence the bottom lines of these institutions.