There are quite a few lending solutions these days for #small businesses — Funding Circle, OnDeck, Kabbage, and Square Capital, to name a just a few — but #innovation and digitization are lagging in other areas, such as digital account opening. Enter Gro Solutions, a sales and marketing platform for financial institutions. Atlanta-based Gro has […]
Bank Innovation
#Cryptocurrency is going mainstream, or rather, #banks and cryptocurrency exchanges are growing #more enmeshed. Jamie Dimon and Warren Buffett may still think #bitcoin is a Ponzi scheme, but in the meantime, Goldman Sachs has reportedly opened a crypto trading operation, apparently a first for the banking industry, and #Coinbase, the market-leading wallet and exchange, is […]
Bank Innovation
Even more than winning on mobile, #banks would like to minimize security threats. Banks lost $ 16.8 billion to fraudsters last year, according to a Javelin report, and the number of U.S. customers victimized by such attacks increased to 16.7 million, up from 15.4 million in 2016. Protecting customers is paramount for executives. A global study […]
Bank Innovation
Accenture’s Global Risk Management Study highlights ongoing integration and #coordination #challenges that face #banking #risk #management teams. In our study’s first year (2009), only 15 percent of respondents reported having an integrated IT risk infrastructure. Over the years, that gap has closed only incrementally. This year, 67 percent of respondents report roadblocks resulting from a lack of integration across the enterprise.
New this year, though, is how our banking respondents view centralization. We first examined centralization trends in risk management coordination by risk type (market, credit and liquidity risks), and the results are somewhat contradictory. The 16 percent who are currently fully centralized expect to see an increase in coordination to 24 percent. Even the 20 percent of respondents who are fully decentralized, operating at mostly regional levels, expect more centralization in two years’ time.
However, the majority of respondents that currently operate both a group and regional level believe the trend is toward decentralization. Forty-three percent of this cohort believe that coordination by risk type will actually decrease by nearly 10 percentage points overall in the coming two years.
Interestingly, we see the same pattern of results in our examination of the coordination of risk management across lines of business. Those fully centralized across lines of business expect an increase of 10 percentage points in two years’ time and similarly those fully decentralized expect almost a halving of their full decentralization rate. Similarly, the majority of respondents fall in the hybrid model of centralization and believe that only 25 percent of risk functions will be coordinated across the business in two years’ time.
Lastly, we looked at coordination of risk management activities across the overall business and found a lack of strong sentiment regarding coordination one way/another. While 40 percent of respondents felt there was limited coordination between local- and group-level risk management functions, nearly 30 percent felt that this was neither true or untrue.
Where do these seeming contradictions lead us? We see the role of risk manager becoming more integrated with the business and thus, demand has been put on the risk function to respond to both global and local needs. One intensive local need to highlight from our study findings is regulations; 78 percent of study respondents cite they are facing increasing demands in this area.
Being an integrator of risk is a challenging role, not only in terms of serving global and local needs but also in terms of cost. Over 50 percent of respondents reported duplication of risk management efforts across lines of business.
While #banks’ risk functions have had steady success since 2009 in coordinating with the business, a lack of integration with other business functions has always been a gap cited for improvement. We see an upward trend in improvement. In 2015, 7 percent of respondents said the risk and finance function worked closely together and provided joint input into enterprise risk strategy. That number more than doubled, to 16 percent, in this year’s study. And in two years, 30 percent of respondents expect that level of coordination between risk and finance.
The other good news is the steady growth in influence among our survey respondents. Risk leaders have evolved from leading a very siloed function in 2009 to gaining a direct line to the CEO by 2013, and even a seat “at the table” in 2015. That positive trend is tempered by the challenge to integrate finance and risk. Only 38 percent of respondents say the finance and risk functions are working together—but they are not working together to help guide enterprise strategy.
So, will risk leaders in banks take their seat at the leadership table to drive further integration? Time will tell, but we believe that working with common data sets and flows can be a powerful lever in addressing coordination challenges cost-effectively.
We expect risk leaders to raise their game and be talented in many disciplines in order to rise to the integration challenge. In my next post, we’ll explore talent needs.
How can risk managers balance both coordination and cost management? We believe sharing data is the key. Integration can be driven with increasing efficiency when data is at the core of the bank’s operating model. To effectively and efficiently share and use data means being a smart technologist, employing new technologies and a coordinated approach across the business.
The post Meeting banking risk management coordination challenges appeared first on Accenture Banking Blog.
For years pundits have warned #banks will lose in the billpay game. Spoiler: They were right. Way back in 2013, Ron Shevlin, now director of research at Cornerstone Advisors, said banks were losing billpay for several reasons: Billers have made it easier to pay #bills (via email and other notifications) An aversion to banks among […]
Bank Innovation
#Citibank unveiled an improved #mobile app #experience for its Phillippines market with added features for billpay, funds transfers, and PFM. Updates include faster authentication and a feature called Mobile Snapshot, which allows users to check their balance without having to log in, one time pin or OTP for an online bank transaction, and Touch ID. The […]
Bank Innovation
#PayPal’s $ 2.2 billion acquisition of Swedish small business commerce platform #iZettle will boost its #presence in 12 markets across European and Latin America, particularly in the physical #retail space. The move highlights the increasingly overlapping businesses of PayPal and Square, of which iZettle is a competitor. Indeed, the #announcement negatively impacted Square’s stock, though briefly. […]
Bank Innovation
Ancient Greek playwright Aeschylus wrote that “When one is willing and #eager, the Gods join in.” In my first post of this series, I pointed out that #bank executives believe their #employees are resistant to AI and that, on average, only 26 percent of their workforce is ready to work with intelligent technologies. We think that pessimism is misplaced, as our survey of bank employees indicate that they are more willing and eager to work with AI than their bosses believe.
#Banks need to seize this opportunity and leverage their employees’ enthusiasm for AI.
Of the more than 1,300 bank employees from large organizations who participated in our Future Workforce Survey, 40 percent are very confident in their abilities to work with intelligent technologies (vs. 33 percent cross-industry). Just over two-thirds said they believe AI will create opportunities in their work, while 72 percent expect it to make their jobs simpler. The majority foresee improved career prospects, while two out of three think AI will improve their work-life balance. Despite this optimism, they know these benefits won’t accrue automatically and 75 percent say it’s “important” or “very important” that they develop their skills to be able to work with AI over the next three to five years.
Banks need to seize this opportunity and leverage their employees’ enthusiasm for AI. Their people are not only impatient to thrive in an intelligent enterprise that can disrupt markets and improve their working experience; they are also eager to acquire the new skills required to make this happen. Yet, somewhat surprisingly, only three percent of bank executives said their organization plans to significantly increase its investment in training programs in the next three years. This low level of commitment, at a time when a new era of work is imminent, will radically curtail their ability to deploy and benefit from AI at scale. This is the primary disconnect at the heart of our survey findings and a wake-up call for bank executives.
Banks fully capitalizing on human-machine collaboration depends on their ability to fundamentally reimagine work. It means redesigning jobs as people move to project-based work. It means refreshing traditional job descriptions and thinking more about the tasks and the interactions between humans and machines in executing those tasks, rather than traditional job descriptions. It also means ensuring that almost all bank employees are conversant with new IT skills and can master new tasks. The employees are willing and eager, so the c-suite gods of the banking industry must now join in to give them the help they need to thrive in the world of the intelligent enterprise.
I invite you to read the complete survey.
The post Bank employees are eager to collaborate with machines appeared first on Accenture Banking Blog.
Financial services are taking on the task of innovating for Generation Z, usually classified as young people from ages 2 to 19. The prime age for marketers and financiers is 11-to-16-years old as they learn about establishing credit and working with #banks. Banks have deployed strategies to understand the way this digitally-native generation wants to […]
Bank Innovation
Neobanks, better established across the Atlantic in Europe, are starting to grow up in the U.S. as well. U.S. challenger bank #Chime is growing by 100,000 accounts per month, according to CEO Chris Britt. The San Francisco-based challenger bank just crossed the one-#million accounts mark, Britt told Bank Innovation, over a span of less than […]
Bank Innovation
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