Digital banking is at a tipping point in the Asia-Pacific region and the financial services industry needs to be prepared for a transformative year ahead.
Banks and financial institutions need to be proactive in their response to the looming digital revolution if they’re going to effectively capitalise on this new era in banking.
One of the biggest mistakes any bank can make right now is to do nothing; it is imperative that banks and financial institutions evaluate their existing strategies and look at how they can evolve with the times rather than remaining stagnant.
We know that a digital transformation is inevitable in the APAC financial services industry, but what we’re seeing is that many established institutions are in urgent need of a cultural transformation before they can embrace this brand-new world.
Banks are now realising that they can’t continue to think and operate the way they always have because the industry is undergoing constant transformation. They really need to start thinking and operating like fintech’s if they’re going to thrive in this new era – technology needs to underpin the entire business model.
Also Read: Threat or opportunity? boosting digital banking in Asia
While enhancing customer offerings is a key benefit of digital banking, the impact on regulatory compliance can also provide a competitive advantage.
Digital banking makes it easier for financial institutions to comply with all the different regulations, making it easier to track transactions, keep data safe and also reduce duplication.
So those organisations that make the transition from less secure legacy systems to cloud-based digital platforms, where security improvements are constantly made, will be able to boast greater peace of mind and set themselves ahead of competitors.
To stay in the game, banks need to be able to roll out products and services at a rapid pace, adding new features to platforms while simultaneously enhancing existing ones. This kind of agility is next to impossible to achieve with most institutions’ legacy systems.
However, composable banking architecture – the quick and flexible assembly of independent systems on a cloud platform – can provide the opportunity for organizations to create dynamic products with intuitive, responsive features that can be quickly and continuously updated.
Also Read: Embracing Singapore’s digital bank shakeup in 2019 and its consequences
A cloud-based platform is designed to undergo short, regular updates with a constant pipeline of improvements that are automatically layered on top of existing technology, which frees up the business to run uninterrupted on the front end. This allows financial institutions to make minor changes regularly, rather than major, infrequent updates that can cause significant disruption and draw the ire of customers, as has been the case with some traditional transformations.
The APAC financial services industry looks set to be turned on its head over the next 12 to 24 months, and as the fintech age forces institutions to digitise, innovate and scale to adapt to customer needs, it will be those banks and financial institutions that can move at the pace of a technology company, while remaining committed to strength, security and service, that will be the leaders of this new era.
–
Editor’s note: e27 aims to foster thought leadership by publishing contributions from the community. Become a thought leader in the community and share your opinions or ideas and earn a byline by submitting a post.
Join our e27 Telegram group, or like the e27 Facebook page.
Image credit: Tim Evans on Unsplash
The post Think like a fintech company: How banks can capitalise on the digital banking revolution appeared first on e27.