How can the channel deliver impactful solutions in the fast-paced world of finance? Comms Business investigates.
It’s often said that ‘money talks’ and in the ever-evolving world of financial services, technology has become a key conduit of success and increased revenue.
For Steve Denby, head of sales enablement, Node4, cloud computing serves as a critical platform that underpins many modern technologies. He pointed to artificial intelligence, machine learning, blockchain, data analytics and advanced cybersecurity tools as examples.
“Giving financial institutions the ability to provide secure, accurate and chronological transaction histories across multiple parties, many organisations are eagerly adopting blockchain for many types of activities, including the ability to hold cryptocurrency keys and digital assets such as Bitcoin and NFT. It is predicted that 38 per cent of institutions expect to invest $5million or more in blockchain technology during 2021 alone.”
He highlighted, “Smartphones are just one way customers want to interact with their financial services provider. Cloud-based omnichannel contact centres can cover a lot of bases, allowing customers to make contact and resolve issues, either with the help of a live agent or real-time self-service, on the channel of their choice. This requires high-end capabilities such as AI, intelligent routing, well-integrated applications and continual data analysis to track and evaluate changing customer behaviours.”
Alan Radford, regional CTO at One Identity, noted how security is a crucial concern. “Financial institutions are of course heavily invested in security. The need for identity governance, privileged management and crypto agility is an ongoing necessity in any financial institution. Other areas of investment include artificial intelligence and hyper-automation, in order to increase productivity in a highly transactional market.”
IT investment is increasingly critical to the operations of financial services businesses, to maintain a competitive advantage. That’s the view of Rosalie Tengey, channel manager at Xledger. She said, “Largely driven by changing customer demand, the Fintech revolution is gathering pace as traditional players invest heavily with many taking a best-of-breed approach to technological implementation.
“Many banks have woken up to the benefits of cloud-based systems and are looking to leverage advances in artificial intelligence. The competition for consumers is also fierce so investment is being pumped into the usability of mobile platforms.”
Faisal Abbasi, managing director for the UK and Ireland, Amelia said many retail banks are now introducing digital customer service agents powered by conversational AI to support their customer service functions. “Some of these institutions previously implemented traditional chatbot services, however the static decision-tree approach to problem solving often left customers more frustrated and many enquires unsolved. Now, with advancements in natural language processing, sentiment analysis and context understanding, digital customer service agents are able to truly problem solve the most common customer requests.
“More sophisticated solutions also integrate directly into back-end systems allowing the digital customer service agent to complete tasks independently, rather than acting as a ticketing service for human agents to then complete at a later stage. For instance, the digital customer service agent can integrate into the bank’s software to complete transfers or block a stolen card.”
Radford feels financial institutions are always looking for ways to further decrease financial risk and improve revenue generation. This drives the need for improved accuracy in reporting and ongoing visibility into compliance enforcement. He said, “Making execution of general audit and certification processes more cost and time effective, is a critical enabler to any financial institution in order to achieve these goals.”
Denby said financial institutions have spent the “better part of a decade” modernising workflows and tools in an effort to accelerate growth, rein in costs and improve agility. “Well-orchestrated digitalisation substantially increases customer loyalty, employee engagement and shareholder value.”
He added, “Customers today are much more discerning and tech-savvy. They want personalised, customised and efficient service, and they want to be able to communicate with companies on their own terms through a variety of channels. Applications need to be more user-friendly, mobile first and provide an ever-increasing multi-channel provision in order to provide leading customer service. 48 per cent of Gen Y and Gen Z consumers are likely to switch banks because their current provider fails to offer services which meet their needs or integrate well with their platforms and applications of choice.
“In today’s world, anything less than 24:7:365 availability of both service and information is enough to make a consumer look elsewhere. Whether it’s the result of a cyberattack, natural disaster or performance degradation, the result is the same. Institutions must shore up both their backup and disaster recovery process. Though this requirement is nothing new, the events of the past year – both the pandemic and an increase in cyber-events – have made the issue even more relevant.”
One million queries
According to Amelia’s Abbasi, one of the biggest challenges that many traditional banks face is how they can compete with challenger offerings on digital experience, without losing the opportunity for high-value interactions with their customers which might present opportunities to upsell or support customer loyalty. He explained, “This was a challenge that CEO and CIO of Bankia, Spain’s fourth largest bank, both understood and was a primary motivation behind the company’s digital transformation. One approach they took to solving the challenge was implementing Bianka, a digital employee in their new mobile banking application that acts as a customer service agent.
“[The digital employee] provides a novel banking application experience to the Spanish market, and can solve many common issues relating to balance inquiries, internal transfers, and account summaries. One year since launch, Bianka had exceeded one million queries through the bank’s mobile application.”
But Tengey feels banking has always been relatively cosy and has historically changed very slowly. “Despite enjoying some benefits of working within the confines of an industry with little change, innovation within traditional banks has been stifled. Of course, it’s only a matter of time before disruptive new entrants come along to shake up in the market and chip away at existing business models. The emergence of these new competitors and evolving customer demands is now forcing existing players to quickly adapt.
“As a finance system provider our experience is in helping financial institutions modernise and not fall by the wayside. Some of the major challenges currently being faced include new customer expectations, new regulatory and reporting demands, evolving technology which changes the playing field, impact of changing demographics, new competitors and shifting economics.”
Key channel role
For Denby, from Node4, the channel has a vital role to play. “Being the conduit that has both access to the innovative technology that leading vendors have to offer, and a nuts-and-bolts understanding of the challenges that the sector faces, Channel partners can provide a tailored roadmap to help financial institutions take the right steps towards their technological goals. It’s not enough to piggyback the ‘blockchain’ zeitgeist simply because the technology is there, the channel can help the sector maximise the opportunities available based on specific requirements, with technology that underpins an unbeatable customer experience.”
One Identity’s Radford agreed. He said, “As with any vertical, the channel plays a pivotal role in showcasing the latest technology, highlighting the current challenges faced by their customers and offering solutions to drive business agility and growth. From a security perspective, they also provide their customers with the ability to keep abreast of growing threats and to have a security strategy that keeps them safe.”
Amelia’s Abbasi pointed to how the financial services industry has seen greater disruption than most in recent years with challenger players forcing the incumbents to radically transform. “And the Channel has played a critical role in bringing together the right people in the ecosystem to drive this innovation and increase the speed to market of new client experiences.
“Indeed, the Channel has transformed its role in recently years to move away from selling to bringing together the best people and ideas to deliver new experiences. This shift has largely been in response to the changing requirements of industries facing large scale disruption and transformation, like in financial services, where IT leaders need a partner that will help them respond to the challenges and achieve their goals, rather than another sales person pushing a product.”
Tengey said investing in new hardware and software to “top up” legacy IT systems will only work for so long. “If financial players fail to innovate, their systems will eventually expire, representing a huge loss in wasted investment.
“Partners get an insight into many business processes, often across multiple sectors. A partner can offer financial institutions a new perspective by introducing new technologies that may challenge the status quo, but will bring about productivity and efficiency savings that far surpass any initial investment – it’s a long-term strategy for scalability and growth.”
Specialise and specialise!
With financial services being a sector ripe for innovation, the vertical specialisms that the channel bring are hugely important. That’s the view of Tom Perry, founder and CEO at Sherpa (pictured right). He said, “By owning the end customer relationship, the channel often has a far deeper working knowledge of financial services than many vendors. It makes a shoulder-to-shoulder sale with vendor and partner each contributing, even more important.
“We are seeing huge investments in customer experience in financial services, as long with global network monitoring, security and analytics. With a blend of solutions often required, the channel is well placed to serve the needs of these financial services companies.
“Our advice working with VARs and MSPs, is to specialise, specialise, specialise. Financial services companies are looking for domain experts, not general solution providers – their tech stack and customer experience are too valuable to do anything else.”
Jeff May, UK sales director at Konftel, said finance and banking is the biggest area of business for conferencing sales, with lots of opportunities continually available. He explained, “Traditionally this is the largest sector for collaboration and in many ways it started the industry with banks needing to have branch meetings without having to travel. It’s now expanded to customer meetings and remote working. Given the scale of this sector it’s just not possible to always have face-to-face meetings. Lots of branches have now closed too. This has further accelerated demand for high quality conferencing.
“Internal communication in particular, along with meetings with VIP customers, require the very best equipment. Many banks are international with tens of thousands of branches. They are in constant need for remote communication.”
He added, “A lot of the City of London is encouraging people to work from home, as they look to reduce their office space. From a reseller perspective, there’s new revenue potential [from] equipping remote workers. In planning smaller office spaces they will need to plan for more online meetings, so more conferencing facilities are needed. The finance sector is probably the biggest and most dynamic. It’s important to use meeting technology which is universal and can operate across multiple platforms, whether Teams, Zoom or many others.”
Pictured below: Konftel conferencing solutions in a meeting room.
Backup should be the first line of defence for many institutions, said Denby. “With a solid backup plan, companies can make sure data is always available. Backup as a service, where a vendor takes charge of a backup to a remote, secure cloud-based data repository, can provide great opportunities. The channel is perfectly positioned to align the institution with a solution that accounts for every eventuality.
“A viable disaster recovery solution should use secure network technology and continuous data protection to protect in transit in the facility of choice, whether an off-site data centre or the cloud.
“Working with a vendor to provide recovery point objectives and recovery time objectives pertinent to the sector is a key part of this.”
Radford at One Identity believes customers are looking for insight from their partnerships and suppliers so anyone entering a specific vertical will need to do their research. “Know the market drivers, look at the landscape, spot the common challenges and build a proposition to address it. Understanding the customers’ world so they can relate and provide guidance will ultimately generate success.
“Keep up to date too: new developments, new legislation, acquisition activity, all provide opportunity for partners and vendors alike.”
Abbasi at Amelia advised MSPs and resellers should focus solely on the client and customer need. He said, “Don’t think about your organisation – or even your customer’s. The focus cannot shift from their customer.”
Tengey at Xledger advised, “Take the time to understand the pain points in your customer’s market. Don’t oversell or overstretch, stick to what your good at and build reputation and trust.”
From contactless payments to AI chatbots, banks and financial institutions are looking towards new technologies to streamline their operations and improve customer experience. But, at the same time, some customers and problems still need a human touch. James Mingard, head of retail and finance at Maintel, said a good starting point is to ask how companies can deliver frictionless customer service and encourage the continued use of these digital services post-pandemic.
He added, “Today’s customers want interactions to be simple and available via multiple channels. They also want to have instant access on any device when buying online or managing their financial affairs. Online FAQs must be updated and online chatbots must be armed with all the information they need to deal with basic customer queries.
“Organisations should consider leveraging technologies such as machine learning to streamline and automate processes. By doing so, teams can focus on the more important tasks such as providing excellent frictionless customer experience.
“Today, customers expect a seamless omni-channel experience with quick response times and personalised products. While the finance sector continues on its digitalisation journey, firms must also reassure customers that the human element is not lost and is here to stay in the long run.”