Agility and customer focus the way forward in financial services
Posted by Amit Singh, Lead Consultant, Oracle Practice, Infosys
With evolving operating models, the financial services industry undergoes dynamic and transformational change every few years. This adds complexity to financial processes that need to efficiently mitigate risk through smart technologies.
With the emergence of the e-commerce retail market, revenue in the financial services sector is expected to grow. Global retail sales including in-store and online purchases are predicted to reach over US $22 trillion in 2015. Financial service providers play a role in driving this growth by enabling fast, safe and user-friendly multi-channel payment options such as e-transfer, plastic money, mobile wallet, and phone banking across various networks.
To tap into the lucrative opportunities within the retail sector, financial services companies need to prioritize customer service, billing accuracy and security. This will help them gain consumer trust and secure their market position in a game where the rules are being rewritten by new, agile entrants. Some examples of new players that have made sustainable growth in this market are Transferwise, Xoom, WorldRemit, and Google Wallet.
So, how do banks retain their competitive edge? Since most banks offer similar services and products, the differentiating approach is one that garners higher customer loyalty by delivering better service and ensuring continuous improvement based on customer feedback. Thus, on a level playing field, banks and financial firms must adopt solutions that deliver superior customer service through secure and customized offerings.
As new technologies become readily available, financial service providers must carefully choose the right application/product that can ensure compliance with the ever=-evolving regulatory frameworks. The right solution should simplify adoption and enable innovative new business models by delivering cheaper, faster and more personalized customer service - a strategy that new players are successfully leveraging.
A recent Harris survey on consumer opinion of 60 of the most visible finance companies in US showed that six of the largest financial services firms were the most-disliked companies. The study reveals that instead of being influenced by size or brand, customers prefer banks that are consumer-centric. Thus, if established insurance, cards and payments (ICP) players and emerging companies want to win in such a demanding marketplace, their key focus should be transforming their business model to improve offerings, reduce transactional fees, enhance customer service, and ensure higher security.
What's in store for the future? As regulatory frameworks and business requirements evolve, the current inflexible and expensive systems will become obsolete. Faced with increasing pressure to reduce the operational time and budget, today's finance providers need to adopt strategic business models to ensure future success. Such a model should define end-to-end governance and enable industry and security standards by implementing highly scalable, cost-effective and tiered structured applications that can respond to dynamic changes and meet future business prerequisites.