Banking, Finance Services and Insurance (BFSI) is more of an industry that encompasses organizations providing related financial products and/or services. Commercial banks, non-banking financial institutions, cooperatives, mutual funds, pension funds, insurance companies and a wide range of smaller financial entities form the core of this sector that operates on highly digitized modes today. Core banking, retail and private banking services, card services and investment, payment gateways, stock-broking, mutual funds and all types of insurances all operate from digitized platform benefiting clients while also safeguarding organizations and their operations.
Digitization of BFSI sector means leveraging the most advanced technology available along with relevant tools for maximum organizational efficiency to bring about multi-dimensional benefits. The process has proven to safeguard operational resilience along with customer relevance with its digital security and seamless omni-channel experience. BFSI digitization is not an end but a continued process that enhances an organizations’ ability to deliver core business with utmost resilience. Workforce and customers, balance sheet and vital services, all remain protected while attaining their respective objectives.
Digitizing processes has helped organizations of the BFSI industry offer faster services, faster customer response, quicker onboarding of loans and their disbursements with fewer errors. Seamless payment solutions using digitized business credit application process has replaced traditional tedious process resulting in customer-centric experiences. Organizations are leveraging newer technologies to streamline and simplify customer journey while providing relevant insights into customers’ finances for reciprocal benefits and safeguarding respective interests.
Reigning trends predict that BFSI services will be seamlessly integrated into the lifestyle of people in the near future with automated, intuitive and user-friendly interactive processes. Traditional banks, fintechs, non-financial and insurance institutions are adapting to remain relevant to customers while safeguarding cost and improving regulatory processes associated with internal and external data systems. The finance sector is predicted to be the hub of cyber security trust with organizations providing regular insights into customers’ finances and offering reciprocal products. Extensive use of AI is expected to change both customer behavior and influence organizations’ operating modules for optimal customer experience.
Digitization of the BFSI industry is an overarching process with multi-dimensional value chains attached to it. Individual solutions with industry-specific components that complement business and operating modules result in concrete tools to improve operational performances.
Based on on-going trends, here are the key themes that have strong affinity with digitization and can have significant impact on target goals.
Customer centric services using digital partners give customers more power than ever before. All channels are actively integrated and connected for services 24/7 using agile operating modes. FinTechs are attracting huge capital investments making them increasingly relevant to consumers.
Strong cyber security complementing increasing digital traffic of organization has helped ensure foolproof support and services to customers even in most difficult times. A robust anti-fraud system that will not just improve customer functionalities but also reduce cost pressure on organizations are the end results of higher digitization processes.
Controlling risks and drive cost reductions while streamlining operations can result from vital and cost-efficient software. It helps increasing efficiency by bringing down number of applications and attaining immense cost cutting without compromising level of customer service.
Extensive use of cloud technology has helped lower costs while increasing operational flexibility. Though slow in adapting cloud technology, the BFSI sector is now increasingly moving towards public, private or hybrid cloud-based solutions with tangible results. The process has proven to increase cost efficiency with improved flexibility letting all sides realize business outcomes of the digitization process.
Increase in operational resilience with strategic outsourcing has helped organizations reduce costs while maintaining operational flexibility. The shift has allowed banking and other institutions focus on improving core services while affiliated services are well taken care of by 3rd party sources. It has helped reduce complexities, reduce infrastructure costs and streamline administration and transactions – all for the benefit of customers as well as organizations.
Use of blockchain lets economic communities store data independently as a single and trusted source of truth. The technology is also extensively used to drive in high flowing revenues that are recorded and certified, visible and secure. It creates a secure finance inventory with amalgamation of enormous data from multi-party platforms to present simplified bankers’ and investors reports.
Digitizing key aspects of businesses to achieve strategic objectives such as lowering operational expenses, controlling IT risks and, improving customer experience are the main objectives and outcomes of BFSI digitization. IT organizations working on these solutions can help improve current consumer journey while building secure platforms for secure banking and financial services.