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How the FinServ industry is leveraging digital transformation to provide secure, meaningful customer interactions
The term "banker's hours" has been around for decades. It has long been understood that if you wanted to make a financial transaction or inquiry, you did so Monday through Friday, from 9 a.m. to 5 p.m. (or thereabouts). But like in so many industries, consumer expectations for financial services organizations have drastically changed over the past decade. Today, consumers expect round-the-clock access to financial information and services. From checking account balances, to transferring funds, all of this has to be done at the click of a button, 24-hours a day, seven days a week. And, of course, it must be done securely.
This change in consumer behavior is just one of the many drivers leading financial organizations to modernize the way they do business. But it is just truly scratching the surface of the ways FinServ companies have aggressively moved into the future through digital transformations. In this article, we'll look at some of the ways the financial services and wealth management industries are undergoing fundamental changes through digital transformations and what the future of FinServ looks like.
Security as a Priority
From an executive perspective, the most important concern across the entirety of financial services is always security. Thirty years ago, this meant strong, secure vaults and well-trained guards. Today, cybersecurity is the name of the game. With high profile security failures occurring at a number of financial institutions and retailers, cybersecurity is top of mind for just about every organization in the financial industry.
Many institutions have turned to blockchain as a means of ensuring secure transitions. While blockchain has been popularized by the proliferation of Bitcoin and other so-called cryptocurrencies, the fundamental process of using blockchain has many applications in more traditional financial transactions. By using cryptography to keep exchanges secure, blockchain is able to decentralize the financial database, and relies on transparency across transactions to keep the network secure. At its core, each exchange/transaction must be approved by a "chain" of computers before it goes through, thus increasing security.
But aside from ensuring secure transactions, there is also a need for strong protections on the client side. Here, FinServ organizations are leveraging a number of technologies to keep clients’ accounts safe and secure. From client-side encryption to something as simple as two-factor authentication, FinServ companies are rapidly adopting new, improved digital means of keeping their clients’ financial information safe and secure.
Moving at the Speed of Business
Also driving the digital transformation of financial and wealth management companies is the need to move at the speed of business. Across all industries, consumer expectations are sky high as far as the ability to move quickly and make high-speed decisions. To keep up with these demands, FinServ organizations are rapidly adopting digital methods that allow them to maintain a high-rate of client satisfaction as well as increase their availability and speed. Along the same lines, mobility is also a priority and giving access to customers while they are on the move is increasingly important.
An exampleof this increased focus on speed and mobility was seen at UBS Bank. UBS, the largest bank in Switzerland, operates in more than 50 countries and has more than 60,000 employees servicing the world's largest collection of private wealth assets. UBS saw a need to make the bank's financial advisors as flexible as possible to give them a way to gain access to customer-related information. They also needed to do this while ensuring customer information stayed private.
What UBS turned to was a digital solution, the UBS Financial Advisor Mobile application. The iOS app was designed for internal use by USB's financial advisors and worked seamlessly with the company’s internal subsystems. Using technologies like sqlcipher, ziparchive, HTML 5, and more, the app resulted in several thousand UBS employees being plugged into one vast knowledge network that enhances their ability to provide maximum value to their clients.
In a recent interview at InterGrowth 2018, Matt Conaty, director of financial sponsors at William Blair, had this to say: “If there's one theme we're seeing across all of our deals, it is the digital transformation of all companies. Every business today is looking for ways to become more automated, to become more sophisticated in the way that they use their data and the way that they access their customers.”
Like many companies, financial service and wealth management organizations are also turning towards big data as a means of better serving their customers. Big data gives FinServ companies a way to look at their operations holistically and gather new insights about how their clients engage with and use their services. By moving towards more digital experiences, financial companies are better able to leverage big data in meaningful ways to drive change and provide better experiences, more relevant new products, and overall increased organizational capabilities.
While financial service and wealth management organizations have been modernizing over the last several years, 2018 has seen a massive boom in the number of companies turning to digital solutions to help them solve the complex problems of a new, connected age. With no signs of slowing down, the industry is sure to see continued explosion in digital growth.