Site icon My Geeks Help

Digital Transformation is changing the banking system from inside out

What is Digital transformation?

Digital transformation is the adoption of digital technology by a company, business, or any service and is not only a technology transformation it’s a complete business transformation. Every company and business is shifting towards digitalization including the financial sector like Banks.

History of Digital transformation in Banking System

The earliest adoptions of digital banking were ATMs and Debit/Credit cards which launched in the 1960s. In the ’80s digital networks began to connect retailers with suppliers and consumers and by the 1990s the Internet became widely available, and banks started providing online banking services. The betterment of the internet in the early 2000s led to the modern digital banking world.

The availability of smartphones in the next decade made transactions go beyond ATMs and can be done online on a smartphone. More than 60% of consumers now use their smartphones as the preferred method for digital banking.

Transformation in Banking System

The banking and financial services are transforming the whole banking services based on customer satisfaction, which can be nurtured with Customer Relationship Management (CRM) software which must be integrated into a digital banking system since it provides the connection for banks to directly communicate with their customers.

It demands end-to-end consistency, convenience, and user experience. Banks need to focus on improving digital technology that provides flexibility, secure services, large-scale implementations, and efficiency with great customer service.

Benefits of the Digital Transformation in Banking

How digital transformation is changing the banking completely

A recent study by Accenture revealed that 78% of consumers are willing to bank with a tech specialized company like Amazon or Google. This indicates that banks that are unable to adopt digital banking may lose their customers. Smartphones, tablets, desktops, and smart TVs have given the convenience of using banking services, and now the expectations of the consumers are high. Digitalization is no longer optional for banks, it has become a necessity to survive.

Journey of digital transformation

  1. Senior Management: Everyone at the Chief experience officer level and key business heads has to be skilled in digital banking.
  2. Sustainable Goals: Project teams must be economical with the goals they are setting.
  3. Risk Management: It is essential to form a risk management strategy, and implement the measures needed to resolve risks quickly.
  4. Strong Governance: Setting up a committee of sponsors, CTO, business heads, IT heads, and technology partners. Keeping the program updated with new technology and user experience development practices with the help of innovation and user experience teams. Maintaining a strong control board to manage a balance between benefits, cost, risk, and timelines about changes.

5. Agile Structure: With the advent of improved digital banking applications, consumers now have the option to have engaging digital user experiences just with a few taps on their smartphones.

Benefits of digital transformation in the banking

  1. It provides improved security on all levels of data handling and saves banks from external and internal leaks of information to frauds and increases the safety of transactions.
  2. Faster operation and lower waiting times.
  3. Better risk management for digital banking operations.
  4. Banking systems can customize offers for different types of customers easily.
  5. Repetitive tasks can be automated in Digital banking.

Drawbacks of digital transformation in the banking

  1. There are High risks in case of poor implementation of the system.
  2. Digital technologies need highly skilled specialists to implement them most effectively. Moreover,
  3. Banks have to replace older systems with modern systems.
  4. High costs – Digital banking demands cutting-edge technologies. As a result, high costs are involved. However, top-quality software results in bigger income and safety.
Exit mobile version