Are you banking on digital finance transformation?

by Theodora (Theo) Lau, Founder, Unconventional Ventures and AT&T Business Influencer

This post was sponsored by AT&T Business, but the opinions are my own and don’t necessarily represent positions or strategies of AT&T Business.

From the early days of ATM to automatic bill payments and voice banking, technology has added tremendous value as consumers navigate increasingly complex financial lives. The pace of digital adoption has accelerated in recent years and has impacted every banking office—front, middle, and back. Physical handshakes and paper contracts are replaced by video calls and digital signatures. And with the help of powerful technologies such as artificial intelligence (AI), banks can now analyze and generate insights from huge volumes of data at a fraction of the speed and cost. This is enabling financial institutions to provide better and more personalized services to their customers.

The benefits of such extensive transformation in the industry are nothing short of formidable, and we are just at the tip of the iceberg. As the world enters an era of economic headwinds, it is more critical than ever to innovate and examine new opportunities for growth, and turn today’s uncertainty to tomorrow’s advantage.

Beyond the shiny gadget – digital transformation in finance

True digital transformation in finance, however, is more than simply automating existing manual processes, putting up a website, or developing an app. While companies (large or small) cannot afford to ignore the need to transform digitally, to get the most benefits out will require more than buying shiny new toys or chasing the latest hype. As the saying goes, don’t do tech for tech’s sake.

Beyond securing leadership and talent, organizations must map out the strategy for execution, which includes understanding where the business is with regards to the competitive landscape, where it needs to go, what is required to get there (including technology platforms and partners), and priority ranking of use cases. The transformative efforts must also consider training and upskilling efforts that will be essential to support the change, as well as circumstances beyond the control of the business, such as economic conditions and other megatrends.

One such trend is the acceleration of digital adoption fueled by the onset of the pandemic. While digital transformation efforts have been largely underway in recent years, the sudden and urgent push towards remote work and social isolation necessitated businesses to adapt almost overnight. With millions of people shifting to working and collaborating virtually, speed and stability were key to business continuity, especially for financial institutions, who had to support not only the needs of concerned customers, but also to transition many of their staff and work processes to online channels and remote work locations. Bandwidth and connectivity challenges aside, cybersecurity concerns were also top of mind. The sheer scale, complexity, and speed of change could not be understated.

But the transformation did not simply stop there. As the line between local and remote employees continues to blur, the unexpected crisis has become a catalyst to fuel further innovation, upending not only how we work and where we work, but also customer expectations.

A better banking customer experience for businesses of all sizes

Mobile banking applications have come a long way since the first mass rollout by the top US retail banks back in 2007; it is almost impossible to imagine an era where access to services was once restricted to specific handsets and wireless carriers. Through the evolution of the app economy and increased mobility, consumers now enjoy a far more robust set of features anytime, and anywhere.

A great example is the use of varied customer communication channels. Beyond traditional call centers and in-app live chats, many financial institutions have implemented digital tools such as virtual appointments at their bank branches to offer extended services for their customers. Some banks also provide video enhancements to give customers support and guidance from their local branch banker, including co-browsing capabilities, that allow customers to share their screen with a banker so they can view and navigate online and mobile banking together.

Customers aren’t the only ones looking for improvement, however. Corporations are increasingly deploying digital tools to reduce cost and improve productivity. Remember the days of manually entering and itemizing expenses after business trips? Businesses can now provide more streamlined payment, expense, and travel experiences for their employees through various digital tools.

Beyond improving customer experience, many of the banks’ use cases are focused on business process and back-office operations, including customer data verification, mortgage servicing, accounts payable processing, regulatory compliance, and anti-money laundering, to name a few. In addition to optimizing cost and increasing operational efficiency, some of these efforts, such as automating dispute resolutions, can also lead to better customer experience, a win-win on all fronts. No wonder analyst firm Gartner predicted that the robotic process automation software market will reach $2.9 billion by the end of 2022, up 19.5 percent from 2021.

Such opportunities are vast especially when it comes to small businesses and solo-entrepreneurs, who are the backbone of our economy but whose needs are often not well-served by larger banks. Providing such communities with access to low-cost digital finance products and other like-minded entrepreneurs can help them grow and scale their businesses in ways not possible before.

The road ahead for digital finance transformation

Today, financial technology solutions now include AI and machine learning. These bring the advantage of digitization to banks and help them meet the competition posed by new players in the ecosystem. With better understanding of customers and their behavior, banks can customize their offerings to deliver more meaningful and differentiated customer engagement and build stronger relationships with their customers. At the end of the day, financial services are ultimately about relationships.

As technologies continue to mature, financial institutions will move beyond the low-hanging fruit of task automation and toward more sophisticated holistic processes across the organization. Technologies such as natural-language processing (NLP) help to break down unstructured content and harness insights hidden between words and conversations, the first step towards customer-centricity.

To support this evolving paradigm and to create an integrated, secure, and engaging experience, having a flexible future-ready infrastructure and a trusted advisor along the journey is crucial. Digital finance transformation is more than a framework and merely implementing new technologies is not enough. It includes advanced security solutions and a strategy to plan for the future. With the right vendor partner, along with the right talent and culture, organizations can evolve and better adapt to the changing world, whether it is in branch, in an office, or digitally via an online or mobile experience.

The future of our connected world is anytime and anywhere. And that future is already here.

Learn more about AT&T Business solutions for the Finance industry or reach out to your AT&T Business representative.