MANILA, Philippines - The ‘platformification’ of retail banking is one of 10 trends that are projected for 2016.
Banks and fintech startups can’t assume customers will ‘switch’ just because they offer mobile apps. The opportunity is therefore for partnership and strategic alliances creating a banking platform – essential to this is software, thus ‘platformification.’
Financial technology or fintech is a line of business based on using software to provide financial services.
“This year’s projections include a ‘doubling down’ on some of the major trends from last year, with new projected trends in the areas of digital and mobile delivery, customer experience, digital payments, alternative products, innovation, authentication and advisory services,” according to Jim Marous, co-publisher of The Financial Brand and publisher of this year’s Digital Banking Report.
The top 10 retail banking trends and predictions for 2016 are: the ‘platformification’ of banking; removing friction from the customer journey; making big data actionable; introduction of ‘optichannel’ delivery; expansion of digital payments; executing on innovation; exploring advanced technologies; emergence of a new breeds of banks; mining new talent; and, responding to regulatory and rate changes.
The first four of the trends were omnipresent trends that were referenced by the majority of the panel of close to 100 global financial services leaders.
For the first time, panelists also believed banking would be testing of block chain opportunities and responses to rising interest rates.
The panelists estimate that the impact of any of these trends will differ by region or institution, they believe each category will have the potential to be game changers in 2016.
Overall, the banking industry would still be playing ‘catch-up,’ and that the potential to be left behind or consolidated would increase as consumer expectations escalate and margins remain thin.
James Haycock, managing director of Adaptive Lab and co-author of the book, Bye, Bye Banks, said a perfect storm of competition, technology, shifts in customer behavior and regulation would wreak havoc on the banking industry.
“It’s a matter of when, not if, banking is reinvented,” Haycock added.
A new generation of companies and leaders are tearing the rulebook to pieces, adopting new technology, using new working practices, and serving customers whose lives are increasingly orientated around their mobile phones better than traditional banks can currently execute.
For the fifth consecutive year, the publishers surveyed a panel of close to 100 global financial services leaders for their thoughts around upcoming retail banking and credit union trends and predictions.
The crowd source panel including bankers, credit union executives, industry analysts, advisors, authors and fintech followers from Asia, Africa, North America, South America, Europe, and Australia.
These exclusive interviews are one of the components of the expansive Digital Banking Report, ‘2016 Retail Banking Trends and Predictions’, sponsored by Kony Inc. to be released soon.
In addition to interviews, the report includes in-depth analysis, charts and case studies around each trend.
Last year’s report proved to be highly accurate, with significant advancements in digital delivery, mobile design, the use of analytics, innovation and customer experience.
“Our expert panel however was a bit too optimistic with their projections regarding mobile payments, industry consolidation and contextual engagement,” the report said.