Increased regulatory pressures, the rapid adoption of mobile devices, and heightened customer expectations will reshape the financial services industry over the next decade. To successfully compete in this new environment, banks must remain agile in responding to customer demand for personalization, accessibility, and value-added financial services.
“Banking has dramatically changed more in the last 10 years than it did in the previous 100,” said CeCe Morken, vice-president and general manager for Intuit Financial Services. “Over the next decade, customers will expect banks and credit unions to provide more value, insights, and personalized services in exchange for their business. To stay relevant, financial institutions must embrace new technologies and engage with customers on their terms.”
Trends shaping the future of financial services
Intuit’s Financial Services division and Emergent Research conducted a series of interviews and forecast workshops with financial services professionals, academics and industry analysts. The report identifies four trends that will redefine the banking experience and guide financial institutions to help them and their customers thrive in a connected world.
• A new playing field for financial services Increasing regulatory pressures and competition from both traditional competitors and new entrants will drive financial institutions to explore new business models, leading to greater industry collaboration, partnerships and consolidation.
• Shifting segments, changing markets Customers both young and old will demand more from their financial institutions, as aging baby boomers entering retirement and Gen Yers approaching middle age will have new financial needs. Competition to serve mid-market businesses will intensify, slimming financial institutions' margins. Meanwhile, the small business sector will continue to expand, with the total number of small and personal businesses expected to increase by more than 7 million over the next decade. Financial institutions must understand and find efficient ways to meet the needs of these businesses.
• The new customer connection Technology will take center stage in serving customers. With increased cost pressures and a growing demand for flexibility, accessibility, and personalization, financial services organizations must accelerate their use of technology to efficiently meet customer needs. The financial services industry will combine cloud-based platforms and applications, advanced analytical tools, ever-larger data sets, and social and mobile computing to design and deliver value-added products and services to customers.
• Reputation and relationships rule Over the next decade, the financial services industry will shift its focus from transactions to customized value-added services. Through a combination of both virtual and brick-and-mortar branches, banks will develop stronger, more personal relationships with businesses and consumers, helping them manage risk, build wealth, plan retirement and anticipate health care expenses. Institutions that provide useful customer insights will succeed.
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