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  • @fintechna 3:35 pm on September 18, 2018 Permalink | Reply
    Tags: , , , , Future,   

    How will data shape the future of banking? 

    Guest blogger Tara Brady discusses how -driven value creation can help their .

    The digital revolution and mobile have transformed the way people interact with their bank. This trend is set to continue, with new figures revealing that mobile transactions are set to rise by around 121 percent between 2017 and 2022, and average branch visits are set to drop from seven to four per year by 2022.

    Traditional providers have also been faced with the emergence of challenger banks (such as Monzo and Starling), which are striving to capture the attention of millennials with their agile, digital offerings. The territory of the high street stalwarts is being encroached on by the likes of PayPal and Apple Pay, which have disrupted the payments market, traditionally an area that banks have dominated.

    Customers or fans?

    New entrants have energised their customer base to something often more akin to a fan club, often incorporating gamification principles to encourage customers to use their digital platform, with the ultimate aim of improving their customer retention and online customer experience.

    Driving this is the principle of personalisation, and the ability to customise, which promotes a sense of ownership in the game through self-expression. Having experiences that deliver delight, preferably packaged into social media-friendly personalised snapshots, is what drives many consumers.

    As brand loyalty diversifies and consumers want more personalised experiences, these techniques become a great way to attract and retain customers. Personalisation allows businesses to understand why their customers do what they do, and that they share their values.

    Data is king

    However, what is underlying this ability to personalise and drive delight is data. Data has quickly become king. The value of the UK data market is set to hit £1.1 billion ($ 1.58 billion) in 2018, making it the second-largest data market in the world and the biggest in Europe. No longer just a by-product of transactions and interactions, customer data itself has become a valuable commodity that can be used to give insights into customers’ tastes and habits. Learning how to interpret and influence those tastes and habits is one of the keys to unlocking the power, and the value, of data. Being able to offer customised products based on the trends, demographics and insights derived from the data, as well as providing the platform to bring all these services together, is where providers like Atom and Monzo have raced ahead of the field, finding unique ways to gamify the data they collect.

    Whilst data is king, not all data is created equal. The key is deciphering how best to use it to play to your strengths.

    But it is not just these challenger banks that can harness the value of data—retail banking as a sector is uniquely placed to ride this wave of value creation. Purely in terms of reach, whilst 78 percent of UK adults use Facebook, a full 97 percent have some kind of banking product. So the opportunity is there.

    The evolving banking ecosystem

    As a result, the retail banking industry is beginning to broaden in unprecedented ways. This is partly due to multitudinous new and evolving technologies generating, among other things, completely different access to data. All this is spurring increasingly serious conversations around how the future of banking will be shaped. The key to long-term success will be a move away from the monolithic banking model, towards an evolving ecosystem that encourages competition but also supports success for all. And data represents a major monetisation opportunity in this changing environment.

    It&;s critical though that banks play to their strengths rather than forcing themselves into models within which they don’t truly fit. Established banks do not need to emulate the personalisation and game-logic of the challengers to make a success of this new marketplace. That said, without banks taking a different path and creating different offerings, the ecosystem won’t be able to function. Banks need to understand their natural fit within the future banking ecosystem to give themselves the greatest chance for success and ensure the strongest foundation upon which to build a data monetisation strategy. The potential benefits of a successful approach are ample, but starting from a shaky foundation could bring this tumbling down early on.

    What kind of bank do you want to be?

    Our new point of view, which discusses this topic and asks &;What kind of bank are you?&; and &8220;What bank do you want to be?&8221; provokes an inward look at your place within the future retail banking ecosystem. To read the report in full, please email [email protected].

     

    Tara Brady
    Senior Managing Director
    Financial Services, UK & Ireland

     

     

     

    The post How will data shape the future of banking? appeared first on Accenture Banking Blog.

    Accenture Banking Blog

     
  • @fintechna 12:18 pm on August 6, 2018 Permalink | Reply
    Tags: , Future, , Modernize, , ,   

    Shape the Future of Financial Services: Modernize Information Systems 

    The reality for many organizations is that modernizing is a project that is often desperately needed but never at the top of the priority list. If the upgrade of a legacy system or even a full migration to an alternative solution was easy, then it would have been done already. In [&;]
    Bank Innovation

     
  • @fintechna 12:18 pm on July 13, 2018 Permalink | Reply
    Tags: AngelStage, Bright, , Future, ,   

    The Future Is Not Bright For Most Angel-Stage Fintech Startups 

    don’t survive. The landscape of payments, lending, artificial intelligence might seem bustling thanks to all the industry hoopla around it, but the success rate for a startup to make it in these fields &; or for that matter any of 15-plus fintech segments &8212; is slim. How slim? Well, according to a [&;]
    Bank Innovation

     
  • @fintechna 12:18 am on July 5, 2018 Permalink | Reply
    Tags: , , , , Future, , ,   

    Lessons from Distributed Ledger Technology and the Future of Banking 

    It’s no secret technologies (DLT) have been front-of-mind for financial institutions examining solutions to existing problems in institutional and retail . While is still a greenhorn in the wilderness of capital markets, the underlying concept should be heralded as a catalyst for innovation. Blockchain has been the inspiration for solutions like [&;]
    Bank Innovation

     
  • @fintechna 12:18 am on June 30, 2018 Permalink | Reply
    Tags: , , Future,   

    Will the ‘Branch of the Future’ Mean No Branch at All? 

    will say that their customers still visit bank branches for many transactions. Whether it’s Bank of America or HSBC or Fifth Third, almost all banks believe branches will have a role to play for the foreseeable . But FIs across the country are shutting down branches at a steady clip, and people who once [&;]
    Bank Innovation

     
  • @fintechna 12:18 am on June 22, 2018 Permalink | Reply
    Tags: , , , , Future, , ,   

    2018 Innovators to Watch: 44 Executives Shaping the Future of Banking 

    PREMIUM &; Every year Bank Innovation assembles a list of 44 that caught our attention in digital and . These are the people Bank Innovation believes to be this year&;s movers and shakers in the industry, paving the way with forward-thinking technologies and ideas. This year the list contains a variety of innovators [&;]
    Bank Innovation

     
  • @fintechna 12:19 pm on May 1, 2018 Permalink | Reply
    Tags: $1.9B, , Baidu’s, , Future, , , ,   

    What the Sale of Baidu’s Banking Unit for $1.9B Says About the Future of Payments 

    Like everything in China, the purchase of Baidu&;s financial services by TPG Capital Management LP and Carlyle Group LP today is a big deal. It is also a deal that will require a big effort by the private equity firms in order to find success. This is a deal that offers a glimpse into [&;]
    Bank Innovation

     
  • @fintechna 12:19 pm on March 20, 2018 Permalink | Reply
    Tags: , Future, , ,   

    The Future of Biometrics in NextGen Payments [VIDEO] 

    How will consumers use for in the ? With the advance of face, finger, and voice identification, biometric technologies will be integrated with IoT devices to provide a better customer payment experience. This was the message from the Mobile Payments panel at Bank Innovation 2018, where payment experts like Ashish Tajpuria, senior vice …Read More
    Bank Innovation

     
  • @fintechna 3:35 am on March 15, 2018 Permalink | Reply
    Tags: , , , , , , Future, ,   

    European banks face challenges in creating future value 

     

    seen as lagging in their digital transformation program saw a decrease of 11% in

    When it comes to future value for shareholders, banks are lagging badly behind GAFA (Google, Amazon, Facebook and Apple) companies, and they also trail financial () companies. Our analysis of Capital IQ data in 2017 indicated that future value represents 49% of the total value of GAFA companies and 40% of the total value of fintech companies, with “future value” defined as the premium investors are willing to pay beyond the value of current operations.

    Future growth value of banks launching an aggressive digital transformation program was 20%, but banks seen as lagging in their digital transformation program saw a decrease of 11% in future value. Clearly, innovation is a key driver for creating future value in banking, but banks cannot simply snap their fingers and magically transform themselves into innovators.

    Our experience shows that there are five key steps to creating future value through innovation:

    1. Become a data-driven organization.
    2. Create a culture that is both open and agile.
    3. Align customer experience and user experience to principles established by GAFA companies.
    4. Drive innovation with an eye to attracting talent and reshape roles (such as moving into new areas like artificial intelligence).
    5. Transform compliance requirements into business opportunities.

    Getting on board the digital transformation train is not easy, as the pace of change is accelerating. To capture trapped value, banks need a disciplined, systematic approach to change, acknowledging that change is a constant evolution rather than a single event. Speed is becoming the critical factor for both decision-making and transformation.

    Banks need to transform their core businesses, determining what is required just to stay viable, and then what is needed to increase profits. But they should no longer be thinking in terms of moving from phase to phase. Rather, they should create an innovation architecture and work on getting the timing, scale and direction right, so that they can manage the investment process and the allocation of capital in both core and new businesses. The ultimate objective should be a circular path of growth and renewal.

    It is worth keeping in mind that banks cannot succeed at digital transformation without a) identifying, training and retaining the right people and b) helping their people understand and adapt to the of the digital era. The order of magnitude of the hiring, training and adapting involved is far beyond anything banks have experienced so far. Banks, as well, have a social responsibility to deal fairly with their employees. I will discuss these and other “people” factors in my next blog.

    The post European banks face challenges in creating future value appeared first on Accenture Banking Blog.

    Accenture Banking Blog

     
  • @fintechna 3:35 pm on March 7, 2018 Permalink | Reply
    Tags: , , , , , Future, , ,   

    Free core banking from the ASP model to be future ready 

    Legendary magician Harry Houdini used to perform spectacular escapes handcuffs, straitjackets, ropes and chains, and often combinations of them. One of his most famous and difficult escapes was the 1904 London Daily Mirror Handcuff Challenge, where Houdini managed to escape from a pair of handcuffs that had taken a Birmingham blacksmith five years to perfect.

    Read the report

    Many bankers see the traditional application service provider (ASP) for managing their systems—renting the use of core software centrally hosted and managed by a single vendor—as a set of handcuffs they cannot pick. The ASP model proved useful in the early 2000s in helping lower costs. Yet over the years, the constant adding on of various components (think digital user interfaces or new payment types) atop 30-year-old has created an increasingly complex maze of systems that is now hard to maintain, difficult to integrate, designed for “vanilla” service, slow to change and costly to service. Add to that the frustration of vendor-controlled product releases that can take the of banks’ IT innovation out of a CIO’s hands.

    If banks are to have a chance of competing for customers’ attention and business against the likes of Amazon, Google, Alibaba, fintechs and others, they must devise a clever escape from the constraints of the ASP model. Digital rivals are built bottom up on IT systems that are open, scalable and flexible, enabling innovative services, high-speed responses and efficient operations. Banks need the same traits to be future —to connect with broader digital ecosystems and deliver hyper-relevant services (financial and non-financial, human- and automation-supported) through multiple and rich channels in real time. Those banks unable to rise to the occasion risk becoming digitally irrelevant and targets for acquisition.

    Luckily, the typical ASP model is not escape-proof. While Houdini was an illusionist who used tricks to perform his death-defying feats, banks can take a few well-staged steps to truly their core banking systems and become future ready.

    It begins with designing the bank’s future-state IT architecture. For the future-ready bank, we envision the ASP model evolving to serve as the engine for Systems of Record, Messaging and Services activity. It will be open, modern, secure and agile enough to allow for seamless integration of applications, API management, Cloud hosting, and plug-and-play of best-of-breed technology. Rather than having the lion’s share of its IT served by a single ASP provider, the bank provider pool becomes more diverse, fluid and adaptable. Then, banks will need to rewire their IT delivery organisation to adopt a multi-speed approach, operating and simultaneously supporting multiple business objectives. They will also need to “hollow out the core” and diversify the providers of IT technology for greater flexibility and innovation. Houdini used keys and cutlery; banks can use processes and technology to free themselves from the handcuffs of the ASP model.

    Read our recent report, Breaking Free of the ASP Model, for a closer look at how banks can break free of their ASP model—and how a few banks are already doing it.

    The post Free core banking from the ASP model to be future ready appeared first on Accenture Banking Blog.

    Accenture Banking Blog

     
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