The top five banking technologies for 2020 are: 1) Digital account opening; 2) P2P payments; 3) Video collaboration/ marketing; 4) Cloud computing, and 5) Application programming interfaces (APIs).
Digital accounting opening (DAO)
Digital accounting opening (DAO) is the most popular technology for the third year in a row. But then why can’t it be done? There are several reasons, but the primary cause is ineffective process design. Many banks approach the account opening process from a regulatory compliance perspective. It takes very little information to get an account open. Banks should redesign the process to allow for account opening and funding – and then work on meeting regulations and reducing risk.
Video Collaboration/ Marketing
Many financial institutions do plan to add video collaboration/ marketing tools in their technology developments in 2020. This would more than double the number of institutions deploying this technology, as some institutions say they’ve already implemented video collaboration/ marketing platforms to date. The rise of video collaboration/marketing into the top 5 was a long time coming. One study found that more than three-quarters of bank executives said that video technology: 1) improved productivity; 2) accelerated decision making; 3) boosted product innovation, and 4) improved the customer experience.
Person-to-Person (P2P) Payments
Roughly three in 10 institutions plan to select a new or replacement P2P payment tool in 2020. That percentage is down from the 35% who planned to do so in 2019. But the number of banks and credit unions looking to improve or transform their P2P payment capacities rises from 25% in 2019 to 40% in 2020. Consumers may not be thrilled about it—but it’s hard to imagine that they’ll switch banks as a result of it.
APIs
APIs are about agility, speed, and personalization. You know you are in deep trouble if 1) It takes nine to 12 months to integrate partners’ products or data, or 2) The partnership process requires significant time and resources to negotiate legal matters, pricing, revenue sharing etc. And for all the talk about personalization in banking, nothing that exists today comes close to what’s possible in an environment with a robust set of partial-stack fintech providers and smart full-stack banks integrated through APIs.
Cloud Computing
A quarter of financial institutions intend to invest in or execute cloud computing technologies in 2020. Despite the numbers, many C-level execs still oppose cloud computing. Cloud proponents fail to sway the holdouts because their arguments run counter to the holdouts’ experiences – and you can’t fight experience-based observations with theory.
For all the hype surrounding chatbots and machine learning, few financial institutions have deployed these technologies. If history is any example, however, fewer will invest.
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