If, on the one hand, the Banking and Financial Services sector has undergone several economic, regulatory and technological changes, on the other, we are facing an increasingly demanding customer who is asking for more personalized, agile and efficient service.
With the pandemic, this need has accelerated, causing digital channels to play an increasingly decisive role in the relationship with the customer. However, it also brought internal and external challenges to banking entities, making data a critical asset for the business. Losses of revenue, capital reserves and the meaningful use of moratoria were some of the problems that the Covid-19 crisis brought to the sector.
The large European banks saw their revenues fall 5% in the first half of 2020. However, the changeover to digital channels has brought new opportunities for the sector, such as entirely automated processes, more agile credit decisions and deeper customer analysis.
To be able to react to an increasingly volatile and competitive market and to avoid any mistakes that may have been committed in the past, Banking and Financial Services started to invest in tools that allow them to increase competitiveness, optimize their processes and offer a quick response to their customers.
Digital transformation is marking the present and future of the sector, and the adoption of Data Analytics and Artificial Intelligence solutions bring changes in operations, sales, customer relations and service security. Furthermore, IoT (Internet of Things) is effectively transforming customer services: mobile devices, wearable technology, voice control, and Artificial Intelligence (AI) is setting a new pace for the sector.
Therefore, the bet on disruptive technological solutions brings greater innovation, profitability and competitiveness to the business. This is a permanent job, and the secret to success lies in the ability to gain valuable insights into market trends, consumer behaviour and expectations, offering customer-oriented services and innovative products that meet their expectations.
The truth is that the financial industry is continually changing and exposed to higher risk due to multiple factors, making it crucial to obtain real-time insights, enabling any entity to gain greater competitive advantages, better profitability and more assertive, effective, quick and flexible strategic decision-making. Moreover, the actionable information generated by a Data Analytics and AI solution can mitigate risk in the banking sector, allowing, for instance, the quick and efficient detection of fraud.
Technology is, without a doubt, a pillar in the transformation of organizations and plays a decisive role in the sector’s differentiation, innovation and competitiveness.
Opinion article published in Risco – December 2021