_pn.png){kind=small}
Managing the unexpected is a common mantra for any business owner, but disruptions can come in many forms, such as natural disasters, a break in the supply chain, loss of manpower, or even a global health crisis. These situations highlight the need for resilience strategies to buffer against such disruptions while establishing a future-proof business model.
What do finance leaders need to watch out for? Let’s look at three factors that will continue to impact the finance industry in the coming months and find out how businesses can prepare themselves for the future.
1. Digital engagement on the rise
A 2018 Deloitte study[1] shows that 61% of consumers visit their physical bank at least once a month. And although there are digital channels like online and mobile banking apps, they are primarily used for transactional activities.
However, COVID-19 has drastically accelerated the shift in preferences. Statistics show that online and mobile banking use will increase steadily between 2020 and 2024, with the Asian market taking the largest share.[2]
Consumers have become increasingly reliant on digital banking solutions, from in-store cashless transactions to digital wallets for e-commerce. As such, these online platforms should no longer be a secondary option for transactions; instead, financial service providers should invest in upgrading their digital offerings to respond to this consumer need.
2. The explosion of fintech
Gone were the days when consumers relied on big-name brands for their financial services needs. Fintech competitors continue to disrupt the banking sector, with key Asia-Pacific markets such as China, Hong Kong, Singapore, and South Korea showing above 60% adoption.[3]
In the Philippines, digital banking has boomed due to the pandemic, with digital-only banks entering the market. To not be left behind, traditional banks must transform their offerings to remain competitive and improve the user experience.
This need for transformation also applies to other sectors in the industry, such as insurance carriers and financial advisors. With clients’ preferences shifting to remote platforms for health and safety reasons, the finance industry must reimagine its traditional delivery models and lean toward digital solutions.
3. Modernizing legacy systems
Financial institutions process a large amount of confidential data, with the digital payment industry’s total transaction value expected at an annual growth rate of 12.01%.[4] This sudden and rapid move to digital has put the financial infrastructure to the test.
Outdated, legacy systems hinder productivity due to slow-moving data pipelines and pose a considerable risk to data security. Without regular updates, your legacy ERP will be unable to adapt to new and developing threats; and even then, maintenance needs to be done internally and on-premise.
Plus, with the work-from-home setup here to stay for the foreseeable future, your system must be able to support in-person and remote workers with the necessary tools for everyday tasks. The shift to modern ERP will allow implementation across the entire organization, regardless of location, with access to the latest technologies and real-time intelligence reports.
These trends highlight the need for modern, agile, and secure technology to survive and thrive in a disruptive economy. Mobile apps and a solid digital presence helped finance companies function and serve their customers even with lockdown restrictions.
But digital transformation doesn’t end there – you need to develop a long-term strategy that will contribute to high-quality experiences for both customers and employees. Learn more about comprehensive digital solutions that can address the specific needs of your business.
Resources:
NTT DATA – a part of NTT Group – is a trusted global innovator of IT and business services headquartered in Tokyo. We help clients transform through consulting, industry solutions, business process services, IT modernization and managed services. NTT DATA enables clients, as well as society, to move confidently into the digital future. We are committed to our clients’ long-term success and combine global reach with local client attention to serve them in over 50 countries. Visit us at nttdata.com/ph.
Contact Us
NTT DATA Philippines
Comments