5 Tech Trends That Will Change Banking Experience In India
2016 was, undoubtedly, the year of disruptions on a global scale. The events of last year – most notably India’s demonetisation drive, the US elections and Brexit – have begun to or are soon expected to create far-reaching impacts on globalisation. Of these, the banking and financial sectors are the ones that are likely to witness the most changes. Looking at the scenario in India, on one hand are traditional banks that are still encumbered by legacy systems and processes. On the other, a global, digital India has entered an age of innovation with the adoption of updated technology. Nevertheless, despite their legacy systems, Indian banks are leading the digital transformation by constantly reinventing their business to stay ahead in this age of digital hyper-connectivity.
The new financial year can be expected to fuel growth in the banking sector with the development of latest innovations like Unified Payments Interface (UPI), adoption of cloud technology, etc. Some of the key technology trends that will reshape Indian banking are as follows:
1. Open banking
In 2017, many banks have already introduced and are operating their open, unified solutions and many more are likely to follow. Consequently, this will facilitate the creation of a well-connected financial and non-financial ecosystem of multiple, interconnected services and service providers.
The recently launched Unified Payments Interface (UPI) by the National Payments Corporation of India (NPCI) will particularly serve as a gateway to future innovations in the open banking domain. UPI also promises to enable payment service platforms to enhance their products and offerings without being bound by account relationships. Customers today desire maximum flexibility, which unified interoperable interface guarantees, allowing for innovation among service providers to drive improved customer experiences.
2. Cloud technology
Cloud computing is the one technology that supports many other disruptive technologies such as Big Data, artificial intelligence (AI), blockchain, IoT. The more progressive banks around the world have already made significant headway with the adoption of cloud computing, and Indian banks are fast warming up to its many benefits. They have begun to realise the degree of agility it brings into business, a fact that has already been evident through the success of fintech companies. As a result, business models for banks and fintech companies in the future are expected to give much greater emphasis to cloud computing. Demonetisation has propelled India’s move towards being a cashless society, or at least a less cash-dependent society; cloud technology will provide banks the much-needed bandwidth to deal with the rising demand for and scale of digital transactions.
Blockchain will be a substantial force enabling banks through the process of reinvention and satisfy increasing customer demands. However, this will not be the year when blockchain goes mainstream, but banks will take specific projects from pilot to production stage and power inter-organisational processes through blockchain. A partnership between Emirates NBD and ICICI Bank announced in October 2016 will see the launch of a blockchain pilot network to process international remittances and trade finance and is expected to herald the transition of blockchain into mainstream banking in the country.
4. Artificial Intelligence
Artificial intelligence (AI) has the potential to transform both front office and back office operations with its self-improving programs. The brilliance of AI has already been evident in the enhanced customer experiences and seamless, differentiated services on digital channels. It has also helped in creating advanced security measures by integrating with banking infrastructure. The use of intelligent digital assistants is now common in some of the more developed banking markets like US, Japan and Hong Kong. The self-learning capabilities of these programs help them get better with every subsequent interaction.
5. Simplifying banking architecture
The foundation for the integration and development of any of the above technologies will be the simplification of banking architecture. Banks will gradually break down their architecture into components in place of the conventional monolithic structure. Simply put, complex architecture will be split into smaller fragments for easy deployment and upgradation of certain functionalities. Besides enabling agile modernisation to keep up with technological trends, compartmentalisation will also allow to mitigate risks associated with specific projects. In addition, banks will be able to enhance their capabilities further through the implementation of enterprise-class applications.
The mobile-first strategy has been adopted by many Indian banks to provide customised offerings through mobile apps. There are other methods of customer interaction besides apps such as smart virtual personal assistants on mobiles that can drive greater, more interactive customer engagement. New-age service providers are leading by example; Ola Cabs now allows customers to make bookings through Siri. So, it wouldn’t come as a surprise if Siri soon helps you move money around or open a new fixed deposit account with your bank.
The Indian government, with the demonetisation initiative asserted its plans to transform India from a cash-based to a digital economy. The Goods and Services Tax system, which is set to be effective from July 1, has been built on a largely digital foundation and is expected to provide a considerable push to the economy’s digitisation efforts and greatly influence future trends in banking.
[Disclaimer: The views expressed in this article are solely those of the authors and do not necessarily represent or reflect the views of Trivone Media Network's or that of CXOToday's.]
- Autonomous Database: Next Big Thing In The Indian Market
- Nine Ways To Ensure Cloud Security In Your Organization
- Indian Life Insurers Partner with Cognizant to Develop Blockchain Solution
- Myntra Acquires Smart Wearables Firm Witworks
- Poor Visibility, Greatest Challenge To Cloud Adoption
- BI in Insurance Industry: What Are The Possibilities?
- Why AI Could Be Cybersecurity’s Next Big Thing
- Consider Blockchain, Think Non-linear!
- 7 Technologies To Increase Business Competitiveness
- Investment to Implementation – Cutting the Long Journey Short