The majority of financial sector organisations have started to recognise the need to implement new technologies. In recent months big retail banks around the globe have publically adopted the next big innovation, Apple Pay; while a new generation of FS Tech
start-ups are surging forwards to either make banks more robust and efficient, or put the incumbents out of business.
This technical transformation is being driven by a myriad of things. Financial organisations are still
trying to rebuild trust with consumers. A recent
report from the FSCS highlighted that only 36% of UK consumers trust financial services firms. At the same time, businesses are trying to play catch-up with their demands, which are shifting and aligning more closely with new technologies, like Bitcoin
and Blockchain, along with mobile payments, at light-speed.
Customers’ brand loyalty has gone out of the window in favour of their own interests. They want the best possible deal for their wallet, aren’t afraid to shop around until they get it; and when they’ve chosen their product, they expect seamless cross-channel
experiences and a flawless experience 24/7, 365 days a year.
Alongside these upwards pressures are downward ones from rapidly changing macro-economic market conditions. The instability of the global economy shows no sign of abating any time soon, with recent drops in China’s economy forcing everyone to hold their
Financial institutions are being forced to re-think their business models at a much faster pace than ever before. But embracing an agile way of working and technological transformation to do so is often challenging alongside legacy systems. Particularly
for the players in the market who have been around for hundreds of years and are trying to compete with younger counterparts and disruptors from outside the traditional FS sector, such as Apple.
This friction between old and new technology can cause serious issues. In the last few months, we’ve seen major banks around the world experiencing serious outages and technical meltdowns. Including the UK’s
Natwest, which suffered a major cyber-attack resulting in users not being able to log into their online banking services on pay day.
The good news is that we’re already starting to see a growing number of established names successfully develop innovative new business models and technologies. Barclaycard US has developed and deployed a “community powered” credit card, which garnered 1,800
members in the first month, enhanced global brand recognition and positive customer feedback. While nine of the world’s biggest banks, including Goldman Sachs and Barclays have joined forces to create a framework for using blockchain technology in the markets
to save time and money.
Though these are positive steps, the future success and safety of financial services lies in investing in more agile systems such as Bi-modal IT and ‘Platform as a Service’ (Paas), which enable organisations to better respond to the aforementioned issues,
changes and demands.
PaaS gives financial services organisations a secure external platform on which to rapidly develop and run new applications and services, without the cost and complexity of buying and managing new resources, or conflicting with existing systems. Because
PaaS is functionally separate from legacy infrastructure and provides a consistent, unified platform to support the continuous delivery of applications, it allows the development and operations team to be more agile in the delivery of new services. This is
turn helps free up IT teams from being bogged down in the management of day-to-day “business as usual” activities, allowing them to better support the business’ innovation objectives. The secure nature of PaaS also means these new applications can be rolled
out without exposing the organisation, and customers, to undue risk.
Working on PaaS alongside existing infrastructure needn’t be a disruptive process. By working closely with technology partners, businesses can ensure the measures are put in place for testing and staged implementations, to avoid customer disruption.
It’s exactly this kind of innovative approach and collaborative thinking which will enable traditional financial sector organisations to continue competing in what is set to remain a fast-moving and choppy market. And with Gartner predicting further disruption
with the rise of autonomous software agents in the run up to 2020, there’s no time like the present to start the transformation.