Blog > 5 Banking Technology Trends in 2019 You Must Follow
GAFA giants (Google, Amazon, Facebook and Apple) are nudging their way into the financial services sector. And when they nudge, everyone especially traditional banks feel the push!
This is one example of many about the extensive disruption taking place in the BFSI sector. In 2018, the BFSI sector witnessed considerable adoption of emerging banking technologies. As digitally-empowered customers will get more demanding in 2019 and the competition would only get tougher, banks and financial institutions (FIs) must progress beyond ‘paper to PDF’ digitalization.
In 2019, banking technology trends would revolve around the API economy, artificial intelligence, predictive analytics and cognitive computing in banking. Banking technology trends are no longer about…
….Data exchange within proprietary systems, it’s about open Application Programming Interfaces (APIs),
….Digitizing traditional banking processes, it’s about optimizing using Artificial Intelligence (AI) and Advanced Analytics (AA),
….Automating processes through interactive voice responses (IVR), it’s about using Interactive Interfaces and Conversational Chatbots,
….Reactive responses, it’s about proactive responses to create a Phygital Banking Experience,
….Providing real-time payment options, it’s about the evolution of cashless, digital and mobile Payment Infrastructure,
….Demographic-based segmentation, it’s about Innovative Personalization using psychographic segmentation.
In the competitive BFSI sector, where big players like GAFA are likely to enter the financial services market, conventional banks and FIs need to put aside their skepticism and trepidation in adopting emerging banking technology. To stay a step ahead, here are 5 banking technology trends in 2019 that every banking professional must watch out for…
1. Open Banking Model – Application Programming Interfaces
APIs provide the infrastructure to give customers universal and secure access to bank anytime, anywhere, through any device or platform. In the conventional setup, data exchange happened within proprietary systems. APIs or ‘software-to-software’ interfaces provide interoperability and user-friendly functionalities. Open banking models using APIs expand banking ecosystems and empower customers by giving a consistent experience and more control over how they choose to interact with financial institutions.
2. Advanced Analytics, Artificial Intelligence and Machine Learning
From virtual assistants to chatbots, AI-powered technology is widely adopted today in several industry sectors. The evolution of Machine Learning, Natural Language Processing (NLP), Deep Learning, Behavioral Engineering and Advanced Analytics, has made AI adoption in banking inevitable. AI in banking helps to achieve process automation and optimization, cost reduction and personalization. It is changing the way customers bank and the way banks do business.
3. Conversational Chatbots and Interactive Interfaces
As customers are already using digital assistants as personal financial bankers, several banks and FIs are actively adopting conversational AI platforms and interactive interfaces. Conversational chatbots, using machine learning and natural language processing (NLP) continuously learn with each customer interaction and get better with time. Banks must leverage the power of AI banking assistants which are built with pre-built machine learning models to deliver a click-free, frictionless and seamless customer experience.
4. Phygital Banking Experience
To put it simply, the term ‘phygital’ refers to the digital representation of experiences in the physical world. Using intelligent data processing programs and AI, phygital insights are derived from observing and analyzing stimuli from experiences in the physical world and translating them to touchpoints in the digital world. Banking technology such as advanced biometrics, behavioral identification and multi-level authentication will enable banks and Fis utilize ubiquitous data to deliver a phygital banking experience.
5. Evolving Payments Infrastructure
The core of banking-customer relationships is payments. An improved payments system not only helps to improve customer engagement and loyalty, it also increases the revenue potential for banks. By using IoT devices and payments systems such as mobile wallets, banks can gain data-driven insights to offer customized product offerings and deliver personalized banking services.
The banking sector needs to evolve and transform by leveraging the power of emerging banking technologies such as…
…Open banking models using APIs
…Data-driven predictive banking using advanced analytics and AI
…Conversational chatbots using pre-built machine learning models
…Phygital banking experience using intelligent data processing programs
…Innovative personalization using machine learning
…Emerging payments systems using Internet of Things (IoT) devices
With continuous evolution and adoption of banking technology in 2019, a shift in the mindset to embrace constructive disruption is going to be one of the important factors that will determine survival in a competitive environment.
…Using technology to be customer-centric
…Using bots to be human-centric
…Using advanced analytics to be persona-centric
Here’s to embracing the wave of innovative technology disruption in banking!
Wishing you a productive and prosperous year ahead!
February 1, 2019
December 20, 2018