Technologies that will impact the financial services industry in 2022

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By Alfredo Rubina, mManaging Director and Vice President of Financial Services at SoftServe

Twenty years ago, during the Internet revolution, we saw many new services, products and companies emerge, and others disappear. Now we are in the digital age and another revolution is underway. A revolution that will change the landscape of the financial services sector more than ever. Financial institutions must adapt to this much faster rate of change. Services, products and technologies that were new and useful yesterday will not necessarily be so tomorrow.

I am in constant dialogue with customers and partners to understand business trends, challenges and opportunities facing the industry today and in the future. Technology and innovation then become tools to address these challenges and seize the opportunities that help the industry succeed.

The application of artificial intelligence and machine learning (AI/ML), cloud, security and blockchain technologies will increasingly be used to achieve hyper-automation, hyper-personalization and a new level of customer experience, engagement and interaction, among others. Other innovations we should expect to see at the forefront in 2022 are in the areas of robotic process automation, digital-only banking, payments, financial inclusion, and sustainable investing. In addition, security will continue to play a central role this year.

Hyper-automation combines features such as AI, machine learning, process mining, process automation, and API integration to replace a high degree of complexity in back-end operations and customer service through end-to-end automation. Both will be widely used in the years to come by companies looking to automate their services, build better solutions, and increase their overall capacity. AI-powered modules, for example, can quickly analyze data and draw conclusions based on facts rather than industry bias, allowing lenders to offer tailored loan rates.

With the pandemic raging for two years, financial service providers should redefine their service and product offerings to create value-added, personalized, multi-channel and proactive user experiences that focus on overall financial health, needs and their customers’ behaviors – not just product requirements.

This will continue to shape how companies design the customer journey in 2022 and beyond. Achieving this level of personalization requires a data and technology infrastructure that enables real-time insights from vast amounts of data streams from various structured and unstructured data sources. Data and analytics, backed by AI, will enable personalized and contextual interactions throughout the customer lifecycle. It’s time to completely redefine the customer experience.

Thanks to the potential of cloud technology and its obvious advantages, more and more financial companies are migrating to the cloud. This brings more agility to global operations and gives employees more options to access work systems from anywhere. It is important to fully understand the technology and its impact on the business. Avoid the mistakes of implementing transformation processes and cloud adoption programs without knowing exactly how they will positively impact the business. Knowing this should help inform decisions about which cloud model to adopt – single cloud, hybrid cloud, multi-cloud, etc.

There’s a lot going on in the payments space due to the pandemic and the resulting shift from retail stores to internet/online shopping. For example, today’s customer expects the checkout process to be integrated with the purchase process and not split into two steps. Payment solutions that include new payment methods such as point redemption, stored value, and deferred payment alternatives would be implemented in the customer experience. Contactless payments and QR code payments are also becoming increasingly popular. It is important to expand the corresponding offers in 2022.

The shift to digital channels has dramatically increased the attack surface and the number of endpoints to be secured. Therefore, security, risk and compliance will continue to be key issues in 2022. Ransomware attacks against banks increased by 1,318% in 2021. At the same time, fraud increased by 238% and data breaches are on the rise. The financial sector recorded the second costliest data breach of any industry in 2021, losing an average of $5.72 million due to data breaches.

Financial inclusion is not just about covering the “unbanked” areas and engaging those customers, but also about making existing customers more financially literate. Proper management of our finances (loans, savings, investments, etc.) can determine whether we can ensure a secure financial future. Financial institutions should use new technologies and innovation to educate, guide and advise customers on these issues so that they can take charge of their future.

For a long time, sustainable investing was seen as a niche area for a small, mostly environmentally conscious clientele, but has since entered mainstream society and become one of the most important global trends in management. of assets. In 2022, this will be a subject that the financial industry will have to address and use technology to offer sustainable products and services and enable customers to make informed decisions.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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