2023 Banking industry trends for Digital transformation

The path of digital transformation is more important than the goal

Future banking will need to integrate developing technologies, maintain flexibility in adopting changing business models, and position customers at the heart of every plan.

Why do banks need to shift digitally?

The transition in operational and cultural practices toward integrating digital technologies across all departments of the bank is known as digital transformation in banking. A successful digital transformation might enhance the bank's ability to compete in a market that is becoming more congested. As a result of digital transformation, transactions can be completed quickly and easily, maintaining records, managing databases, and deploying services that promote financial inclusion and overall customer retention. For banks to stay flexible and compliant, promote growth, cut expenses, and replace outdated operations, they require digital transformation tools.

Banks may benefit from digital transformation by bringing in new customers as well as providing excellent customer service to their current ones. Some of the primary advantages banks might hope to gain from digital transformation include concerns about cyber security, the need to secure customer data, and the possibility of interface with digital payment platforms. Additionally, digital transformation can enable banks to offer their goods and services on online marketplaces.

The advantages of a banking digital transformation include:

• Online trust is built

• New customers acquisition is less expensive

• Personalized Offering

• Allows for Innovation and Agility

What prompted and expedited the big migration to digital banking?

The pandemic lockdown resulted in an enormous surge in remote/online buying, which expanded the use of digital payment networks. Cash usage declined rapidly, and the introduction of payment alternatives by non-bank rivals accelerated the digitization of banking activities. Digital banking significantly improved the customer experience by providing real-time support, tailored services, highly customized solutions, reduced response times, and 24x7x365 accessibility and availability.

How can banks combat the concerns of digitization?

• Modernize the data model and legacy technology

• RPA and AI should be used to support back offices

• Upskill current talent at the appropriate rate

• Work to ensure widespread adoption within the organization

Trends drive the transformation of future banking services

• Engagement Banking - Incorporating services into people's lives and businesses

• Technology Banking - Delivering effective services using technology like RPA or AI

• Social Banking - Establishing new services without the use of mediators

• Platform Banking - Providing a technologically enabled integration of traditional and digital banking

The Most Important Digital Trends for Banks in 2023

 Advocating for Digital Payments

The banking industry is changing most quickly in the field of payments. While cash is still used for many transactions, the adoption of contactless and cashless payments is growing across all consumer demographics and business sectors. In-app or browser-based online purchases, in-store checkout using a mobile phone and/or QR code, and person-to-person payments are all digital payments used by most of Americans.

 Work with fintech companies

Owing to their digital technology, mobility, and capacity to turn data into highly tailored experiences, many officials inside conventional banking firms continue to view fintech startups as a significant competitive threat. However, fintech is now seen by more bankers than ever as a path to innovation. At banks and credit unions of all sizes, collaboration with fintech companies has sped up several innovative initiatives.

 Pay attention to hyper-personalization

Consumers have learned to anticipate highly tailored digital experiences across all industries. The value to the consumer is an extremely relevant level of service that builds loyalty by recognizing previous interactions and forecasting future requirements. This level of personalization frequently enhances sales and engagement, achieving optimal revenue.

 Discover Data and AI Possibilities

Banks are already utilizing data analysis to improve performance or enter new industries. Many organizations are also leveraging data to improve member and customer experiences, inform decision-making, and minimize development time and costs.

 Consumers will increasingly favor digital channels over traditional communication techniques

When selecting a financial provider, more and more people emphasize digital solutions. Because they choose digital platforms over the services they provide, this digital banking trend will continue to accelerate in the near future, resulting in the closure of significant sectors of many banks' branch networks as their digital maturity increases.

 The digital transition will usher in a new era of competitiveness

Introducing new companies offering solutions such as robot advisors and peer-to-peer lending platforms has resulted from the digital transformation of established financial services providers. Banks are already collaborating with fintech firms to strengthen their own digital transformation efforts. As banks extend their offerings and customer bases, several of these companies have emerged as key rivals.

 Individual banking will become more popular among people

The banking business is growing more focused on the customer. Customers want more personalized experiences that allow them to accomplish more on their own. As digital transformation proceeds, various self-service options will be available at a bank branch or ATM near you, allowing customers to create accounts conveniently and quickly.

 Big Data and analytics should be prioritized

Big data will enable banks to place customer behavior at the heart of their business models. As a result, they can deliver more tailored services and increase revenue by utilizing predictive analytics. 2023, expect to see more confined solutions powered by quick and easy data gathering, allowing banks to gain a 360 ° perspective of their customer requirements and provide them with spatially pertinent information about discounts or customized offers.

 Banking applications are becoming into sophisticated digital assistants for users

By 2023, banking applications will have evolved from basic self-service tools to customer relationship management platforms that anticipate the consumer's requirements and give personalized recommendations depending on their financial status.

 Blockchain is a technology that will endure, but it must develop

Blockchain technology will be used in many aspects of financial services beyond basic by 2023

1. Blockchain for KYC and due diligence
2. Issuance, trading, and settlement of securities
3. Blockchain-based transaction processing
4. The growing use of blockchain-based digital currencies

 Low-code/no-code development frameworks for quicker time to market

With no-code/low-code development platforms making it feasible for banks to produce digital products rapidly and effectively, the banking sector is observing a trend toward quicker time to market. Therefore, expect widespread use of no-code and low-code development platforms in the banking industry in 2023.

Financial industry digital transformation forecast for 2023

• As automation and block chain penetrate more into financial processes, transactions will become touchless

• As services become more digital, finance will focus more on business insights and service

• Finance has gone real-time. Periodic reporting will no longer drive operations and decisions

• Self-service will become commonplace.

• Finance apps and micro services will put traditional ERP to the test

Why Choose Sun Technologies for your Digital Transformation Journey as we

• Value customer satisfaction

• Are a team of experienced professionals providing enhanced digital services

• Adopt proven methodologies, Streamlined delivery and cost- effective projects

• Are known for our transparency and collaboration

Looking for a partner to kick start your digital business transformation journey?

Sun Technologies is fully-equipped, experienced, and ready to take your organization to the next level with our wide array of services tailored specifically to the banking industry.

We help simplify and accelerate your digital initiatives.

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