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The impact of the Covid-19 pandemic on the global financial sector has been significant, with the banking industry taking the brunt of the consequences. The banking sector today is faced with an unprecedented set of challenges, including resilience in the face of disruption, a changing cybersecurity landscape and most importantly, evolving customer expectations.
With the limitations on physical interactions and in-person banking imposed by pandemic-induced lockdowns, digital adoption by customers is higher than ever before. In this context, digital reforms play a key role in banks’ ability to keep up with a rapidly changing consumer landscape.
Customer loyalty should be at the core of any change strategy for banks. Omnichannel products, services, enhanced capabilities, new conveniences in digital payments and mobile banking, increasing integration into a digital ecosystem are all ways in which banks can both activate and retain high-value customers.
Digital adoption in the banking industry
Customers are likely to defect from their banks mainly for new banking products, and in this day and age, those are most likely new digital offerings that provide ease and convenience.
Research reveals that digital-only banks, also known as neo-banks, are poised to outperform traditional banks due to their ability to match evolving customer expectations.
But the digital transformation does not stop with giving the end-user more choices. Banks can take advantage of analytics to better understand their customers and create individualized experiences. In a market where neo-banks, fintech and digital startups are beginning to make their impact, forward-thinking banks must adopt more digital services and capabilities to remain competitive —or risk being left behind.
How banks can embrace digital transformation
Recent advances in analytics offer an unprecedented opportunity for banks to develop a deep, granular view of their customers – going beyond demographics to knowing each customer as an individual in real-time. Analytics can deepen customer relationships and help banks identify their high-value customers more effectively for long-term stability and profitability.
IBM has been leveraging their analytics expertise to augment banks’ capabilities in providing personalized services. IBM Customer Insight for Banking strategically uses AI, advanced analytics and automation to deliver deep customer insights in the form of predictive models about life events, financial events, buying and selling behaviour, and potential discontinuation of banking services.
IBM also takes a proactive approach to anticipating and preventing financial crimes with solutions such as AML Monitoring and Analytics for Banking, Multi Channel Fraud Analytics for Banking and IBM Counter Financial Crimes Management for Banking, as financial crimes represent an increasing concern in the digital landscape. Furthermore, solutions such as IBM Algorithmics and IBM OpenPages help banks to devise smarter risk management strategies and meet the demands of regulatory compliance effortlessly.
Digital transformation for ease of banking – IBM’s API solution for Federal Bank
Banks that are adopting a digital transformation strategy are looking to create seamless banking experiences for their customers. A case in point: Federal Bank wanted to build a robust, secure and scalable API solution that would enable them to work with different fintech companies. As an industry leader in digital banking solutions, IBM was a natural choice.
The IBM Cloud Integration Expert Labs team worked closely with Federal Bank’s IT team to create a hybrid solution – IBM API Connect. The IBM API Connect platform enables Federal Bank for a cloud and hybrid cloud journey. After going live with 20 APIs, the platform has now grown to 200 APIs, enabling Federal Bank to work with 40-50 partners. The solution has streamlined partner onboarding while maintaining industry standards of security, reliability and efficiency. Ease and convenience of banking has substantially increased with the platform as partners can now literally plug and play.
This digital transformation journey was made possible by the industry expertise, agile development and flexibility offered by the IBM API Connect platform.
The future of banking is digital
As industries everywhere grapple with resilience in the face of disruption, actors in the banking sector must embrace digital tools and solutions to meet the challenges of banking in the post-pandemic era.
Overall, the pandemic’s acceleration of banking towards the digital will result in lower costs and better customer service. Analytics offers a number of ways in which banks can benefit from data-driven insights, strategic automation and forecasting for better customer relationships, risk management, and fraud protection.
Are you ready for your digital transformation? Get in touch with IBM, an industry expert in digital banking solutions, today.
Disclaimer: This article has been produced on behalf of the brand by the HT Brand Studio team.
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