Posted by Bethany Frank on 15 Mar 2016
Consumer demand is constantly being shaped around digital transformations led by the likes of Facebook, Apple, Google, and other technology giants. As digital technology becomes increasingly intertwined into everyday life, consumers are beginning to expect a high level of around-the-clock convenience, speed, and efficiency from all kinds of service providers – especially their banks.
Despite their long histories, banks are not immune to competitive market forces, especially as an influx of start-ups look to capture business opportunities in areas traditionally dominated by banks. The financial services market is rapidly evolving to include major non-bank players in P2P payments, real-time payments, and other growing sectors. Consumers expect all businesses to adapt to their changing needs with the same speed and agility as they have come to expect from the tech industry, leaving banks to play a complicated game of catch-up with more nimble technology pioneers.
Businesses that fail to adapt to modern times will likely face client retention challenges in coming years. Outdated legacy systems hinder a bank from driving innovation, attracting new customers (especially those of younger generations), and progressing into the new age of business. Smaller organizations are especially at risk of losing customers to competitors that offer a more modern banking experience.
Replacing legacy systems, however, is a costly and risky undertaking that involves a lot of cooperation across multiple divisions, departments, and sometimes even countries. One strategy being explored by some to address large infrastructure issues is to implement small-scale solutions to improve data sharing and communication between existing systems. While such solutions may work in certain situations, they commonly create an environment of even greater technological complication, especially when targeted solutions are designed and implemented by disparate third-party providers.
Banks sometimes attempt to rectify legacy system challenges on their own but often hit roadblocks somewhere in the process; a technology partner can help banks avoid wasting time and resources by providing a comprehensive diagnosis of issues at the onset, developing the most suitable solution(s), and delivering them to market quickly and efficiently. Rather than going at it alone, working with a financial technology partner can help a bank gain a unique bird’s eye view into the technology needs of a fast-changing industry. A broad industry perspective combined with specialization in IT systems, applications, and software development can be instrumental in properly addressing the complexities of outdated technology infrastructure.
A premier technology partner goes above and beyond mere product development to become a true ally to the bank. Rather than implementing bandage solutions that continue to create silos, the right partner will take the time to understand business models, how IT systems work together across various divisions, and how to best utilize resources to form a comprehensive solution that moves the bank forward.
Financial institutions must invest in updating and improving outdated legacy systems to enhance the customer experience and modernize service. With many long-established players now facing stiff competition from Silicon Valley and beyond, a dedication to innovation and customer service can go a long way in helping banks adapt to changing market forces and remain strong in the 21st century. Visit https://www.alacriti.com/Services to learn more.
01 Jul 2019 Blog 3 Applications of Machine Learning in Financial Services Advances in machine learning have game-changing implications for financial services. Learn how ML is transforming customer service, personal finance, and fraud and risk management in our blog.
02 Apr 2019 Blog Fintech Disruption: Creating Opportunities for Financial Institutions Fintech can help financial institutions deliver better customer experiences. This blog examines opportunities that fintech can help unlock in faster payments, conversational commerce, and data and analytics.