Crystal ball-gazing is prevalent at the start of any new year, but it certainly isn’t easy in 2021. Banks already wrestling with a long list of challenges before the COVID-19 pandemic are seeing their business priorities shifting in order to ensure they thrive and continue to innovate.
So how is 2021 looking? In its report, The Top Emerging Technologies In Banking In 2021, analyst firm Forrester interviewed more than 25 banking business and technology decision-makers, as well as financial technology vendors, to chart their tech investment priorities for this year.
"Hot" technologies for investment
I was interviewed for the report, on behalf of CREALOGIX, which highlights "hot" technologies, including AI, APIs and chatbots, that will shape the future of the banking industry and customer experience (CX).
Banks, cites the report, are set to bet big on "hot" technology investments such as CX and openness (through APIs) as they continue to embrace digital transformation. It adds that banks are recognising that investments in improving CX via AI in various forms – basic chatbots are one example – depend on solid, modern architectures and APIs to deliver true digital banking. That’s the approach we have taken in the development of our own CREALOGIX Digital Banking Hub.
APIs allow banks to exchange data, products and services with partners. Prior to the pandemic, says Forrester, less than 2% of banks didn’t invest, nor planned to invest, in APIs. However, the criticality of APIs for banking business and architectures suggests that they will regain their pre-pandemic importance – the report says that 80% still see APIs as a "moderate" or "high" priority.
Importance of chatbots
Basic chatbots can automate tasks that aren’t too complex but, as Forrester reveals, only 40% of marketers at banks say they have adopted chatbots in the previous 12 months to enhance customer experience. So, there is lots of scope when it comes to maximising customer personalisation – something we have focused on in the development of our AI-based Conversational technology.
Some technologies can create value for banks and their customers today, but the report warns that technology teams "should avoid using emerging tech that cannot deliver more value than established technologies…". That’s a minefield we guide financial institutions through when they are trying to select and implement the right technologies to drive digital transformation.
Looking to the future
Future banking will be "invisible, connected, insights-driven, and purposeful", says the report. It adds that, "while we are already seeing these themes play out now, they will be far more prominent by 2025 and table stakes by 2030".
I am quoted in Forrester’s report as saying that "Personalisation does not only need flexible application logic, but also smarter predictive capabilities". These capabilities not only allow banks to make better-informed decisions, but also help them serve their customers better and more seamlessly.
Having smarter predictive capabilities will undoubtedly help financial institutions see a clearer way forward in terms of achieving their digital goals in 2021 and beyond – even if they don’t have a crystal ball.
The report The Top Emerging Technologies in Banking in 2021 is available to Forrester subscribers or for purchase.
