Global banks lag in digital transformation, says Infosys Finacle honcho Maiya
A joint report by Infosys Finacle and Qorus reveals that banks globally still have miles to go in leveraging the latest technology, which is crucial to taking quick steps in their digital transformation journey.
The report titled “Innovation in Retail Banking” showed that most banks have not yet deployed digital banking transformation solutions on a large scale. Only 11 percent of respondents stated that their digital banking transformation solutions have been fully deployed.
The study, which is based on a survey of more than 650 senior executives from global financial institutions, identifies standards and trends for innovation in banking services, including innovation investments, competitive landscape, advances in digital transformation, and success with new technologies.
According to the report, nearly 90 percent of banks globally still believe that their digital transformation journeys have not worked out as expected.
“If there is one thing that shows clearly in the report, it is that banks need to make better use of technology. Because what was relevant five years ago has never been more important because technology is moving at a stage much faster than anyone can imagine,” said Rajashekara at Maya, Vice President and Global Head of Business Advisory, Infosys Finacle. business line in an interview.
While Infosys Finacle is part of EdgeVerve Systems, a wholly owned subsidiary of Infosys, Qorus formerly known as EFMA (European Financial Management and Marketing Association), is a global non-profit organization by banks and insurance companies.
Sharing the findings of the report, Maya said bankers were found to be willing when it came to making use of the technology.
For the survey, banks with assets of less than $10 billion were considered for those with more than $500 billion.
When asked about the key points to follow in banking management from the report, Maya said that an important one that was raised was that “if you want to stay relevant and contextual to your customers in banking, you have to keep innovating and keep investing in innovations until Relevancy and context persist from the customer’s point of view and the customer is not going anywhere.”
Miya said banks should do five things in an orderly way.
“First of all, we found that banks have to innovate better. The second is that banks have to do better with customers and partners. And the third is that banks have to do better in order to be relevant to the changing context of inflation and the interest rate regime. And the thing is The fourth is that banks have to transform in terms of how to innovate better, engage better, do better, and transform better.
Then there is one thing in common that appears very clearly in the report to management – how to make better use of technology.”
At the same time, Maya noted that Indian banks present a different picture when it comes to leveraging technology (most of the big Indian banks are ahead of the curve).
In fact, India has one of the most developed banking environments globally when it comes to democratizing payments, trade and credit using technology, as well as creating digital public infrastructure, said Maya.
Base platform
Asked what would be the emerging business model that will work for banks in the next five to seven years, Maya highlighted the current trend of banks looking to become platforms.
“Many of the banks we surveyed responded that they would like to get into the platform routing business model. That means they would now like to become a network provider, a platform provider where the business service seeker and the business service provider come together to make these transactions happen,” he said.
He said that many banks globally are moving towards becoming a platform company because this is where they see a lot of synergies available for them to expand their business.
“When a company, regardless of the industry, becomes a platform company, there is clear business growth that happens. Hence, banks are also looking into this type of platform business. That’s what we found out in our report,” he added.
Maia highlighted how the top eight of the ten most valuable companies on Standard & Poor’s are platform companies. Also, 60 percent of global unicorn companies are primarily platform companies.
When asked about the technology initiatives that banks need to adopt, Maya said that one is in terms of opening APIs, the second is in terms of working very closely and collaboratively with the ecosystem, and the third is making sure that “your systems and APIs are exposed in a cloud environment so People can test it in the sandbox environment that is provided.”