{"id":14390,"date":"2020-01-09T18:55:23","date_gmt":"2020-01-09T13:25:23","guid":{"rendered":"https:\/\/coforge.site\/cigniti\/blog\/?p=14390"},"modified":"2020-01-09T18:55:23","modified_gmt":"2020-01-09T13:25:23","slug":"bfsi-technology-trends-2020-beyond","status":"publish","type":"post","link":"https:\/\/coforge.site\/cigniti\/blog\/bfsi-technology-trends-2020-beyond\/","title":{"rendered":"BFSI technology trends to win in 2020 and beyond"},"content":{"rendered":"

A<\/span>\u00a0well-functioning financial system\u00a0<\/span>drives a well-functional economy. The modern economy and the modern financial systems have technology as one of the most powerful driving\u00a0force. T<\/span>oday, t<\/span>he Banking, Financial Services, and Insurance (BFSI) domain operates out of our smart devices. Online transactions have<\/span>\u00a0become the norm.<\/span>\u00a0<\/span><\/p>\n

Over the centuries, banks have evolved from being a secure place for storing valuables to a one-stop-solution for all transactional processes for a user. As we move deeper into the age of digital, we can expect to see more groundbreaking, technology-driven, innovative banking solutions\u00a0<\/span>with customers at the core of all strategic actions.<\/span>\u00a0As JP Nicols says, \u201cIf banks cannot truly be customer intimate, they are doomed to be just dumb commodities, acting behind the scenes, like utilities.<\/span>\u00a0<\/span><\/p>\n

2020 is going to be remarkable for the BFSI domain. With digitalization and ever-evolving technologies, the industry is aboard the train of disruption, which does not seem to halt any time soon. For the organizations associated with the BFSI sector, it is the time to prepare themselves for the emerging and maturing technology solutions. Let us understand the biggest BFSI technology trends that will shape the industry for this year and beyond:<\/span>\u00a0<\/span><\/p>\n

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  1. FinTech<\/span><\/b>\u00a0<\/span><\/li>\n<\/ol>\n

    \u201cFinancial institutions must be able to deliver an easy to navigate, a seamless digital platform that goes far beyond a miniaturized online banking offering\u201d, says Jim Marous. And, that is what FinTech is about.\u00a0<\/span>A recent McKinsey survey results indicated a skyrocketing growth for FinTech in 2020. The FinTech market is all set to exceed the worth of $30 billion this year.<\/span>\u00a0<\/span>\u00a0<\/span><\/p>\n

    Data-driven analytics and\u00a0<\/span>hyper personalization<\/span>\u00a0are among one of the consistent themes that lie at the core of the FinTech services. Gartner predicts that this year, chatbots will interact with the customers of 85% of banks and businesses. The increasing focus on conversational interface is to eliminate the human intervention as much as possible for higher productivity. Blockchain in FinTech is projected to touch $6700 million by 2023 in the U.S. It will be used as a key security feature of the FinTech applications for processes like smart contracts and digital payments.<\/span>\u00a0<\/span><\/p>\n

    FinTech startups have certainly disrupted the BFSI market dynamics for the incumbents. By forming a strategic alliance with the startups, the incumbents can offer their users the ideal speed, security, and efficiency. We can expect to hear more M&A deals getting signed as we move further into the 2020s.\u00a0<\/span>\u00a0<\/span><\/p>\n

    Banks, financial services providers, and insurance companies are required to upgrade their way of doing things. Digitalization is inevitable. Embracing the digital technology is the key to achieve accelerated growth.<\/span><\/p>\n

    \u00a0 \u00a0 \u00a02. Enterprise agility<\/span><\/b>\u00a0<\/span><\/p>\n

    Customers will continue to demand\u00a0<\/span>faster<\/span>\u00a0services and reduced costs. Enterprise agility is essential to meet these growing demands.\u00a0<\/span>Speed\u00a0<\/span>will remain<\/span>\u00a0the most critical factor that will\u00a0<\/span>ensuring<\/span>\u00a0scalability and competitive edge\u00a0<\/span>for<\/span>\u00a0an enterprise.\u00a0<\/span>\u00a0<\/span><\/p>\n

    By implementing Agile practices within the organization, a BFSI enterprise can respond to its customers\u2019 needs in a flexible manner while increasing the speed of execution. The ownership-mindset fostered by Agile results in greater\u00a0productivity<\/span>and\u00a0adaptability.\u00a0<\/span>\u00a0<\/span><\/p>\n

    The pace of innovation in the present dynamics\u00a0essentiates\u00a0flexibility within a BFSI enterprise. In order to stay competitive, it is necessary for the enterprises to adopt innovative solutions. And, to be able to adopt, enterprise would require an Agile and responsive infrastructure.<\/span>\u00a0<\/span><\/p>\n

    \u00a0 \u00a0 \u00a0 \u00a0 3. Automation and AI<\/span><\/b>\u00a0<\/span><\/p>\n

    Automation and AI technologies are maturing in the BFSI domain. Although, earlier the domain did not gain success in its automation efforts, the future can be different.\u00a0<\/span>McKinsey<\/span><\/a>\u00a0<\/span>expects that early growing pains will ultimately give way to a transformation of banking, with outsized gains for the institutions that master the new capabilities.<\/span>\u00a0As per McKinsey, after the emergence of a second wave of automation and AI in the sector, 10 to 25% of the work across banking functions will be performed by machines. This will free employees from iterative tasks and allow them to attend to those tasks that bring higher value to the enterprise.<\/span>\u00a0<\/span><\/p>\n

    McKinsey suggests that\u00a0<\/span>the sector<\/span>\u00a0should cease this opportunity by taking a strategic approach<\/span>. The enterprises in the BFSI segment should redesign their legacy processes considering the automated or AI-led tasks.\u00a0<\/span>\u00a0<\/span><\/p>\n

    Robotic Process Automation (RPA) tools will be widely used to automate financial and valuations processes such as accounts payable\/receivable,\u00a0<\/span>reconciliations<\/span>, data preparation, and consolidation. Automation will accelerate time-consuming tasks such as insurance claims processing, policy administrations, credit card processing, and billings.<\/span>\u00a0<\/span><\/p>\n

    \u00a0 \u00a0 \u00a0 \u00a0 4. Cybersecurity and financial frauds<\/span><\/b>\u00a0<\/span><\/p>\n

    Digitalization of\u00a0BFSI\u00a0industry\u00a0<\/span>has only one disadvantage \u2013 cyber threats.<\/span>\u00a0<\/span><\/p>\n

    A\u00a0<\/span>PwC report<\/span><\/a>\u00a0blames the following forces for the sub-optimal cybersecurity status, which will remain the top concern for all the enterprises embracing digital transformation:<\/span>\u00a0<\/span><\/p>\n