Dynamic changes have occurred in the banking sector over recent years. IT (Information Technology) services are vital to this transformation’s success.
IT services encompass diverse technologies and solutions and accommodate multiple needs across various industries.
In this case, financial institutions can use them to do the following:
- Catering to tech-savvy consumers.
- Streamlining operations and
- Investigating new horizons of expansion and success.
According to a report on IT services, banks could see their revenue grow by up to 20% because of this. However, some financial institutions need help to embrace these services.
Throughout the following piece, you will learn the various facets of this transformation and how this shift can revolutionize banking.
The Power Of IT Services For Financial Institutions
1. Core Banking Transformation
Financial institutions’ core banking transformation involves the overhaul of crucial computing systems.
These services fall within the banking category, from deposits to loan disbursement, payments, and accounts management.
An up-to-date core banking system is essential for smooth and efficient operation. IT services for financial institutions enable them to update core banking infrastructure.
This transformation may involve:
- Migrating to cloud-based platforms or,
- Combining with external software
These solutions offer banks multiple benefits. For example, it may:
- Improve scalability: Clouds enable banks to expand or contract their core banking systems according to business needs or customer demand.
- Enhance flexibility: By combining external apps, financial institutions can expand their capabilities and better support clients.
While they have their perks, IT services can only accommodate specific core banking transformation projects. And so, to achieve successful core banking transformation projects, top-notch IT services for banks are essential.
2. Digital Banking Enablement
One aspect of IT services for banks is digital banking enablement. The result of this is digital banking solutions that offer exceptional customer experiences. These services may include:
- mobile banking
- voice assistants
Banks can attract and retain young customers by offering convenience, customization, and interactive digital channels.
By 2024, a Statista report predicts that 3.6 billion digital banking users will be globally.
Because of this, IT services like Hexaware and its digital arm Mobiquity focus on setting up digitally based banks and improving traditional banking systems.
Leveraging knowledge of customer experience transformation and digital innovation, Hexaware creates better UX for banks by developing new digital services and enhancing old ones.
3. Data And Analytics
A fundamental part of IT services for financial institutions is data and analytics. Through this service, businesses can collect, analyze, and act on data from diverse sources and systems to better understand their customers.
Through data and analytics, banks may improve customer satisfaction, increase sales opportunities, manage risks better, and adhere to regulations more effectively.
Besides, reports show that data analytic implementation can lead to remarkable gains in customer retention and bank profit margins. Banking strategies depend heavily on data.
IT services catering to the banking and financial sectors dominate at this industry’s cutting edge. They empower banks to unlock data and analytics’ potential through various innovative solutions.
- Data monetization: Banks generate additional income through data analysis from different sources, such as core banking systems, digital platforms, third-party programs, and vendor systems.
- Data visualization: Insights into customer satisfaction, operational efficiency, revenue growth, and risk reduction are provided through interactive dashboards and reports by helping banks.
IT services’ data and analytics prowess extends beyond interpreting history; it forecasts the future.
Employing state-of-the-art predictive analytics enables banks to predict market behavior, mitigate risks, and improve investment decisions, resulting in substantial declines in portfolio losses for banks.
4. Business Process Outsourcing
At the core of IT service offerings for financial institutions lies business process outsourcing (BPO) — a functional delegation process. This delegation enables enhanced efficiency and effectiveness thanks to outside service suppliers.
Examples of BPO services include:
- 24/7 customer support with AI and chatbots
- Streamlined loan processing with automation
- Machine learning that enhances fraud detection
KYC verification has become more efficient with Optical Character Recognition and facial recognition technology.
With predictive analytics, efficient collection strategy development is possible.
With BPO, bank operations can become more efficient, precise, scalable, and high-quality.
In today’s transformational environment, partnering with an IT service provider that excels is essential. By offering customized BPO solutions, they enable banks to remain at the forefront of industry developments.
5. Testing And Quality Assurance
Testing and high-quality assurance are necessary for ensuring the performance of banking applications and systems.
These tests may include:
- functional testing
- performance testing
- security testing, etc.
Financial organizations can use rigorous testing and assurance procedures to elevate system and application quality, making them more accessible, reliable, and easy to use.
These benefits may include up to 50% cost savings, higher customer satisfaction by up to 30%, faster product development cycles by up to 40%, and increased revenue growth of 3.5 times through testing and quality assurance.
Modern financial institutions must adapt to maintain competitiveness in today’s rapidly evolving digital landscape. These transformations necessitate integrating Information Technology (IT) services.
Such services have the potential to assist banks in the generation of new avenues for growth, the enhancement of their resilience, and the improvement of customer satisfaction.
These outcomes collectively solidify their commanding position in an industry in a perpetual state of evolution.