Banks are currently fighting to stay competitive in the financial sector. Investing millions and millions of dollars towards new technologies that will help transform the way banking is done within the bank and for customers outside of the bank. The changes from technology are spearheading the banking system from all angles, and all at one time, making it absolutely necessary for banks to adjust and also go on the offensive and introduce new technologies to help customers.
Customers are simply demanding faster and better banking processes with the use of new high-tech services and technologies. Connecting a bank account directly with an app is now a common feature these days and banks fear that loosening security may force a deal with tech companies for data-sharing. AI, or artificial intelligence, is having more of an impact than ever in the ways of automation and regulators are working to keep up with the speed of development.
According to Carlos Hank Gonzalez, customers do not want to have compromised data or bank account information, so it is imperative banks do all they can to fend off issues that may result in backlash. Customer interaction with banks is changing greatly, as different generations take different approaches to banking. This article will go over many ways technology is having an effect on banking as well as self-service digital banking tools.
The Human to Artificial Intelligence Shift
In many sectors, the human worker’s position is shifting and changing with emerging technologies and the banking system certainly is seeing its fair share of change. Many popular large banks are taking giant leaps towards artificial intelligence and robotics to help make banking processes more streamlined, efficient, and create a more uniform process and procedures. Automating anything and everything a bank can is the overall goal for the future. Banks are taking it one step at a time, but the speed of the steps is accelerating. In the future, the bank employees themselves may have to change their skills. Rather than counting money, the banks will need humans to oversee, train, and fix the systems and the robots themselves.
Customer Access and Control
There is an enormous amount of data sharing in today’s world of technology, and many times customers don’t know their information is being sold or shared. People are demanding a stop to this and want control over their own data. In the future, there will most likely be a trend placing data back into the hands of the customer. There are new technologies being developed that will give banking customers the option to make their own settings on who can access their data and at what level. Placing control of personal data into the hands of the customer seems to be the future.
Faster Payments Battle
Banks are in a battle over which payment system is the fastest and the best to use. With many improvements coming in the way of payment technologies, banks are creating new and improved products because of the faster payments that are occurring. These payment systems work all hours of the day and night and businesses can expect much faster payments because of this. There are already payment plans in place that are fast, such as Real-Time Payments, also referred to as RTP, however, the use is not spread throughout the banking system currently. Big Banks are pushing for a system that is interoperable with the federal government, to make payments faster and more secure.
Banks Are Getting Faster
Online lending is a growing trend and shows zero signs of slowing down and actually appears to be speeding up with more lending happening daily. Banks are being forced to make faster decisions on loan applications from the small business sector and retail clients. Banks are upgrading and replacing current systems to help speed up the online loan process. Teaming with tech firms to help overcome current banking shortcomings within the bank, is another strategy being used. The goal of the banks is to give the customer the best and fastest experience possible with online loans. Security is of the utmost importance and banks are working to develop more secure platforms that will protect the customers’ precious data. New login authentications will most likely be seen in the future to gain access to a bank account.
Blockchain has been talked about a lot over recent years and banks have begun to take notice of this emerging technology. Many banks have begun to file patents in relation to blockchain, yet no public tests have been conducted. Several patents were filed by Mastercard and the financial world did take notice, but Mastercard has not taken action on the patents. Overall, there is a lot of hesitancy to move toward blockchain in the banking industry because of the massive swings in the market. Blockchain will need a more secure and viable approach to be a force into the future, but it does seem to be becoming more popular.
Generation Z is Coming
Banks have begun to accelerate their preparations for the coming generation into the banking system. Generation Z is different from generations of the past, as they come to the table with their pockets literally and figuratively filled with technologies. Finding ways to appeal to the tech-savvy Gen Z is imperative to attract the younger bankers. Gen Z consumes information, handles personal tasks, shops, and uses messaging apps as their primary form of communication with others. Gen Z is also wary of falling into deep debt, unlike the generation prior, so banks need to approach this customer differently. Banks are putting their efforts towards self-service digital banking tools, building Apps that will help bring in this generation, as well as building games.
The banking system is going through massive changes with technology, yet the banks are embracing the new results and faster service for customers. Customers can look to have more power over their data while also getting faster and better service.