The financial sector is facing significant challenges when it comes to technology. Emerging FinTech companies excel where legacy systems fall behind. Not only are these antiquated systems slower and less capable of keeping up with customer expectations, but they’re also too expensive to replace. Many finance businesses spent too much money on their existing systems to be able to supplant them entirely.
This severely hamstrings many finance companies’ abilities to innovate much less keep up with the competition. With the future of many finance businesses hanging in the balance, the finance sector needs to find ways to contain costs while successfully implementing a digital transformation.
Looking Beyond Cosmetic Solutions
Whether working with wholesale or retail, clients expect a digital experience from their banks, accountants, and more. Back-end operations will need to change in order to support a radical shift on the user’s end. The following are several ways digital technology is poised to revolutionize the finance industry:
- Automation for all. Direct-to-consumer companies score consistently higher on customer satisfaction than traditional institutions. This is because customers don’t want to go through a middle man to obtain a product or service. Translation: Clients don’t want to go to the bank if they can achieve their goal on a smartphone, tablet, or computer. As a result, asset managers are moving more and more toward providing automated advice for all of their customers—a service once reserved for affluent clients.
- Merging the strengths of traditional finance with FinTech. FinTech corporations scared much of the finance sector because they disrupted key elements of doing business. However, these startups are quickly realizing the challenges involved with scaling up due to numerous regulations. There are clear advantages for traditional finance companies to partner up with FinTech startups—the challenge is finding the right fit.
- Multifaceted virtual assistants. Existing chatbots leave much to be desired when a client is upset or needs to speak with a human representative straight away. In addition to increasing the capabilities and functions virtual assistants can perform, the finance industry is also looking to improve their sentiment-monitoring capabilities. This means the AI will be able to recognize when a customer is distressed and can create an immediate path for clients to connect with a human agent. This reduces customer frustrations and improves their overall experience.
- Data management. As technology increases, so too does the amount of data available to the finance sector regarding their clients. However, the information overload makes parsing that data almost impossible. Firms are actively seeking new ways to store, classify, and utilize the data in a way that maximizes profitability and value while curtailing waste.
The finance industry can’t hope to address the above objectives and challenges by throwing money at them. In 2017, Banks spent $20 billion on digital technology, most of which didn’t pay off in the long run. The finance industry will need to balance growth against its risks in order to implement a digital transformation. Contact the experts at MMA Florida to learn how we can help your Florida-based finance business.