How Digital Integrity and Transformation Strengthens Retail Banking Capabilities Against Emerging Competitors
Retail banks have found themselves at the center of the digital disruption shaking financial services. In addition to direct competition from the challenger and neobank entering the industry, they also have to contend with Facebook, Amazon and Google and their peers looking to expand their already large footprint in the banking space. It’s a frightening prospect not only because of the scale of these tech giants, but also their approach to data. With businesses built on collecting customer information, these companies are uniquely positioned to create innovative new banking and payment products that deliver world-class customer experiences.
So how can incumbents hope to be competitive? Well, these banks have their own data powers. The majority of the population in mature markets still conducts most of their financial activity through traditional banking channels, giving their banking providers detailed and valuable information about customer preferences and behavior. The challenge for banks is to be able to access and use this data, which they have struggled with to date.
The difficulty is that many traditional banks face a difficult combination of obsolete and inflexible legacy technologies and complex, unstructured data. This means that they often depend on manual processes or workarounds that reduce confidence in data integrity – manual processes are highly vulnerable to operational failures or human error. This makes it impossible to aspire to the kind of data-centric business and decision-making activity seen in tech giants.
The solution? Banks simply cannot hope to harness the full power of their data while relying on existing technology to control it. These solutions, which have often developed over years of organizational complexity and M&A activity, are not only ineffective, they also cripple banks with excessive operating costs and burden their IT teams – which are necessary for supporting the development of innovative digital offerings that customers have come to expect – with outages, maintenance needs and personalized development. The only cost effective way to ensure data integrity is for banks to move away from these legacy solutions and turn to control platforms designed for the digital age. The complex nature of decommissioning legacy systems means that many companies choose to work with vendors specializing in this area to speed time to market and reduce project risk, allowing them to start bridging the gap with legacy systems. new digital players.
If retail banks are serious about defending their businesses against new competitors, they need the speed and agility to keep up with them and getting there requires an accurate, high-quality database. To be successful, banks must abandon their legacy systems and embrace the challenge and opportunity of the new digital world.
To find out how Gresham Technologies ensures the digital integrity of the world’s largest financial institutions, click here.