The financial services industry has been on the forefront when it comes to adopting new technologies and upheld traditional models of working. However, the COVID-19 pandemic saw sudden and unprecedented changes happen across the financial sector, shaping the way of interacting and doing business. The most notable change was the shift towards digital transformation.

The industry managed to adjust fast and weather the digital storm to continue its operations through the pandemic. Nonetheless, it is clear that the winds of evolution are not transient and are set to continue in 2022. Financial institutions are strategically thinking about the tools they might need to rely on to adjust to the technological trends likely to dominate the financial industry in 2022 and beyond.

We look at some of the top six emerging trends to watch out for this year.

1. Mobile Banking

Today, the number of mobile phone users stands at 6 billion, of which 1.7 billion of them are unbanked. Financial institutions like banks can target these devices to reach out to their target customers and literally put their services on their hands. People are increasingly ditching cash and plastic money in favor of mobile payment services, seeing society become more digitally connected. Mobile phones have become the primary interphase between the real world and the digital one.

It is even easier for financial institutions to provide services through the phone instead of the brick ‘n’ mortar branch service. Having access to customers through their mobile devices gives institutions access to a wealth of lifestyle and behavioral data that they can use for other purposes like biometric security measures to reduce fraud or offering tailor-made services and products.

We expect to see financial institutions increase the deployment of chatbots, personalized communications, and cardless banking through mobile phones.

2. Focus on Customer Experience

Digitization has seen new players like digital-only banks and fintechs enter the financial services industry. This is owing to the increasing numbers of customers who embrace digital-first transactions. The anticipation is that by 2024, customers will be conducting 61% of their businesses with banks and other financial institutions digitally.

With this preference in mind, where customers rank the digital experience as their number one business challenge area, financial institutions should focus on providing better services by improving the in-app experience. Some of the factors providers need to focus on include simplifying the application process by having guided forms and allowing for digitally notarized documents, improving self-service capabilities using embedded tools, and increasing efforts on SMS outreach.

The goal is to upgrade these investments so that they not only meet the customer’s needs at the moment but also anticipate where the customer is going and meet those expectations.

3. Websites and Apps Localization

For a brand to make the most of what the internet offers, it needs to expand its online presence beyond geographical borders to reach a global audience. The first step is to create websites whose content is localized to conform to the target market’s needs in different geographical regions. This will help establish the company as a global brand and build trust with the target market. The majority of the people only buy from sites that present information in their native language.

To enhance the customer experience, increase visibility on search engines, and increase conversions through website localization, financial services need to engage translation services experts. Such will not only translate all the content on the site for a multilingual interaction but will adapt the site to local regulations and adhere to best practices of on-page SEO for greater success.

The way to adopt their products and services to a global multicultural audience is by focusing on both translation and localization. In other words, to adapt a service or product to a new geographical area, they will need to focus on addressing non-textual, cultural, and linguistic components of their website first.

4. A Hybrid Workforce

After customers, the next vital audience to address is the employees, most of whom are more inclined to embrace working from varied locations besides the four walls of their branch office. Financial institutions need to embrace this shift and consider fostering productivity and having a smooth interaction across in-person and remote work environments.

To get this shift right, the institutions need to keep their employees connected through a technology ecosystem that is easy to navigate. Currently, most teams rely on Zoom, Google, and Microsoft Teams to stay connected.

Suppose the current trends are anything to go by. In that case, the best way that companies can prepare their employees for future success is by improving the internal efficiency of their critical business processes. Identify manual steps that can be automated and securely connected to digital tools, so the workforce is well prepared for the ‘anywhere economy’ whose future is a hybrid workforce.

5. Modernized core systems

The year 2020 saw the financial infrastructures and planning assumptions challenged and tested. The architecture of a good majority of the core systems couldn’t address the pace and volume of technological changes suddenly required. While relief programs like Payment Protection Programs saw increased demand, financial institutions faced bottlenecks in document processing, review, and approval.

Data pipelines and the slow-moving of information hindered real-time insights and response to customer needs. Financial services needed to upgrade their core systems to agile, secure, resilient, and scalable technology infrastructures to address the Coronavirus recession. The need for modernized core systems is evident, the new imperative from now on into 2022.

6. Blockchain

Blockchains areo encrypted databases distributed across many computers and governed by consensus, s no one person or body has overall control. Basically, they are digital ledgers of transactions recorded in duplicates and distributed across a network of computer systems, making it quite difficult or impossible to change, cheat, or hack the system.

Traditionally, the financial services industry is governed and regulated by national banks or governments. This means blockchains are hugely disruptive to the financial sector. However, they offer the potential of streamlining infrastructure in the financial industry by creating transparency, cutting fraud, increasing security, and speeding up core processes like settling transactions. Many institutions are yet to embrace the blockchain projects, with some just trailing and piloting them.

It is inevitable that this is one of the transformational technologies that will rank highly in 2022. It is no longer limited to just digital money and cryptocurrencies, and its potential in financial services reaches far beyond.

Conclusion

Although there is no way of telling certainty what the future holds, we believe that these are the top trends to notice as the months unfold. Please engage with us in the comment section and let us know your thoughts on this.

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