Every financial institution knows the value of future-proofing their business for the challenges ahead, but never has it been more vital than during the COVID-19 pandemic.
When the first COVID-19 case was confirmed in the US on January 20th, 2020, very few people accurately predicted how devastating the pandemic would be on US businesses and financial businesses. With no business prepared for the unique economic crisis brought about by the pandemic, it was inevitable that the combination of a worldwide health crisis and lockdowns across the globe would pose a threat to the financial industry.
One of the biggest questions you might now be asking is “how can we prepare for the future?”. Unfortunately, there’s no easy answer, because no-one knows what a post-COVID-19 world will look like. However, that’s not to say that there aren’t things you can do now that’ll give you a head start on adapting to emerging consumer trends in a post-pandemic landscape.
Using Cloud Computing
Many banks and financial institutions often struggle with having to maintain legacy technology such as outdated servers, old operating systems, and traditional software. While sticking with technology that’s proven to work in your business may have been the best solution in previous years, consumer trends are showing that cloud computing is the way forward.
The COVID-19 pandemic has shown that even when customers are unable to access physical branches, they still want to discuss financial products and plan for their future. This is currently difficult with some traditional financial institutions, as they still rely heavily on legacy technology that requires human operators to make financial decisions.
However, cloud computing FinTech services allow financial institutions to utilize big data and statistical models through cloud computing to help customers. By using cloud computing, your customers can be pre-screened for financial products without needing to speak to a staff member, helping free up that person’s time to work on revenue-boosting projects.
Cloud computing can also help you to provide financial products and services to SMEs or rural populations who may otherwise struggle to access a brick-and-mortar store. With many experts predicting that cities will look very different in a post-COVID-19 landscape, having cloud computing systems that allow customers to access support without needing to visit a branch will prove essential.
One of the main benefits of cloud computing is that it removes the need for you to store vast amounts of hardware on-site, saving you money, repair costs, and time. With your staff working remotely, having cloud-based software that is more easily accessible from home computers and laptops can save you money in having to provide hardware and additional software licenses for home workers.
It’s also significantly easier for your development teams to push updates to your platforms, as these changes will only need to be saved on the cloud rather implemented in-person.
DevOps environments have become more popular in development for a reason – they’re cost-effective, efficient, and improve productivity. If you’re not familiar with DevOps, it simply refers to a cycle in which development teams work closely together with the teams responsible for the deployment of technology (also known as Operations). Instead of technology being given to Operations teams once development has finished, they have a hand in ensuring that it is ready for deployment from day one.
When your financial institution or bank develops a new technology or pays for new software, a DevOps environment makes sure that your software is only released once it is fully functional from both a development and operational standpoint. This means that your projects will avoid the plague of an unnecessary rework that comes with a lack of collaboration, helping your technology teams keep on track with their projects.
This means that it’s easier to protect your technology investments because it’s a highly adaptable process. Multiple teams are involved throughout the development process, ensuring changes can be discussed and made during development rather than following the testing cycle.
In addition, DevOps is well-suited for remote development teams and staff who are working from home. With specialized DevOps software and processes, each of the teams involved in the development process can easily communicate despite the requirement to work from home.
Predictive AI Technology
In recent years, breakthroughs have been made in the fields of machine learning and AI, making these technologies more accessible than ever before. By using advanced machine learning models to create financial AI technologies, you can create predictive models and algorithms that can estimate consumer trends, demands, behaviors and expectations.
As discussed earlier, customers unable to access brick-and-mortar branches still need to access financial services and support. Predictive AI technologies can provide a valuable benefit in these cases, as through analyzing customer data and requests, it can estimate when your customers are most likely to enquire about mortgages, loans, credit cards, and other financial products. These customers would be sending data through digital channels, so you’re able to continuously improve your predictive AI technology by inputting new customer data every time a request is made or data is sent.
Using technology to predict if or when a customer might default on payments can also be of significant benefit to banks and financial institutions, particularly in a post-COVID-19 world. With the economy devastated by repeated lockdowns and the heavy toll of the pandemic on almost every industry, financial institutions need to have better systems in place to protect themselves against payment defaults. As scientists are predicting that COVID-19 will continue throughout 2021 and beyond, financial institutions like yours must be prepared for future economic challenges.
Build Omnichannel Banking Strategies
One of the reasons some financial institutions suffered during the COVID-19 pandemic was that they were only conducting business through a traditional face-to-face service. While many had online portals for banking services, these often didn’t help customers if they needed a new product or advice about their financial situation.
For financial institutions to future-proof themselves for a post-COVID-19 world, they need to offer more banking and financial service channels. Customers increasingly want to interact with businesses online, so having online services like AI chatbots for simple queries and live chat agents can save both you and your customers time.
Customers are also looking for a more personalized service in which they feel like their needs have been fully accounted for, which is why a combined approach can be a great way to encourage loyalty among customers. When customers are able or happy to visit a branch, a hybrid approach offers the customer flexibility over how they conduct their business.
For example, if a customer is interested in a loan, an omnichannel banking system would see them messaging a chatbot to say they’re interested in a loan. That chatbot would then ask the customer questions to narrow down what they’re looking for, and depending on the customer’s needs, they could either book an in-person appointment at their local branch, connect with an advisor on live chat, or request a call-back.
Not only does this give the customer more flexibility, which is likely to improve customer satisfaction with your financial institution, this also future-proofs your business. In case of future lockdowns or other emergencies in which your brick-and-mortar locations are closed, an omnichannel banking strategy allows you and your staff to continue supporting your customers. By adopting this strategy now, you can implement a customer journey that is easily adaptable regardless of what happens in the post-COVID-19 world.
This article was written by Cesar Cotait, CPQi Brazil Managing Director. As the leading provider of digital transformation for financial institutions in the Americas, we at CPQi are here to support your journey to future proofing your business in a Post-Covid-19 world. To book a free consultation, email us at firstname.lastname@example.org or book a consultation on our website.