3 Easy Ways Banks can Emerge as Digital Front-runners
Incredible digital revolution in financial payments space has brought in ultimate changes to the banking sector. On the other hand, with the overwhelming competition posed by the digital wallets leveraging miscellaneous opportunities, banks are in the utmost need of embracing digital strategy and need to move faster than they currently are to offer services that are more convenient and engaging.
According to a survey, around 70% of participated banks’ chiefs were concerned about their current fragmented strategy of implementing digital innovation.
Under the present market structure, if banks continue with their legacy systems and traditional marketing approach, they may lose even to early-age startups. On the other hand, if they are able to embrace technological and digital innovations in business strategy and marketing approach, they could be strong enough to retain the position in the market.
Here are the three opportunities that can help banks emerge as digital winners:
1. Open innovation
The open source movement has enabled many digital innovations in the recent times, and banks are not far away from recognizing the value of that. Banks can benefit from the new resources, skills, and ideas by permitting access to parts of their source level programming and intellectual property to innovators outside the organization. In this case, Block Chain technology is one immense area of development that the open source methodology makes beneficial to financial institutions. According to a survey conducted by Accenture in 2015, around 40% banks had already adopted open innovation and another 56% were yet to adopt it in the coming years.
2. Collaborative approach
Banking organizations are always open to have mutually beneficial partnerships within the industry. Now it is time for them for exploring collaborative relationships with businesses outside their industry. If they opt strategic partnership with fintech companies, they’ll be able to enjoy innovations and technological expertise they bring. This would enable them to better attract and engage customers with newer, more innovative digital banking solutions. Around 60 percent respondents in the survey agreed the need of forming such alliances, and the majority of them felt the existing organizational culture requires to be altered in order to be favourable to such approach.
3. Strategic investments
Strategic investment can be defined as a financial institution financing an innovative fintech start-up, which may not bring direct return on capital, but it can bring tangible results in the form of cutting-edge technology, and processes. This approach is trending nowadays and is expected to continue in the coming years also.
The ultimate winner in the digital race is one who fulfils customers’ requirements in the most intuitive way. The current digital disruption has the potential to help banks deliver better, and more efficient digital services. But the real digital success is behind building result-oriented strategies, and collaborating with the right digital partner who can bring valuable experience and expertise.
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