It’s a real juggling act for the financial sector, needing to constantly develop new technological advancements to meet consumer demands. This sits alongside the battle to stand out against the ever-increasing market competition. The consumer remains the focal point for any high street or challenger bank. So, what financial innovation and technological enhancements are on the horizon for the financial sector in the next 12 months?
Ultimate personalisation for customers
A recent Accenture report revealed that many banks target customers “based on lifestyles, values, aspirations, mindsets, and underserved needs”. Accenture anticipates 2019 being a year for the financial sector to go one further than personalisation by segmentation. They may adopt an ever-granular, individual approach to communicating to customers via advanced analytics and digital technologies.
The concept of serving a segment of only one is unlikely to be restricted to individual consumers. Banks will be encouraged to adopt a similarly one-to-one approach with small and medium-sized businesses. Doing so will ensure that the needs of individual entrepreneurs and businesses are truly met. The financial sector is taking a leaf out of search and social marketing giants Google, Amazon, and Facebook by leveraging data and insights to underpin their core services.
The emergence of innovative “phygital” banking
One of the biggest challenges legacy banks have is to compete with ‘digital native’ challenger banks. For challenger banks, it comes naturally to provide an intuitive digital experience. As a consequence of the cost of operating branch networks and the increasing volume of transactions processed online, some banks are taking the plunge to offer exclusively-digital banking services.
The idea behind “phygital” banks is to provide customer experiences that certain demographics demand. Some individuals simply don’t have the time to visit physical branches. For these consumers, the flexibility and accessibility that a digital-exclusive bank can offer stands as a huge benefit. This kind of “phygital” innovation is made possible through the adoption of cloud-based technology and Open Banking APIs that accelerate the time to market for new products.
AI-driven processes that allow banks to offer advice for today and the future
Predictive banking is said to be one of the fastest developing trends in the financial sector in 2019. Using artificial intelligence, the global banking industry can build real-time predictive profiles of clients and consumers. Customer communication is likely to become increasingly AI-driven, with chatbots and robo-advisers on-hand to recommend suitable actions, acting as trusted advisers rather than an automated upselling tool.
Ultimately, banks and credit unions acknowledge their need to become more proactive with enabling and educating their clients.