Banking innovation follows the advent of digital evolution. Big data, blockchain and artificial intelligence, discover the main transformations of the bank.
The banking sector has often been at the forefront of technological developments in the past As example of banking innovation, we remind of the credit card itself. It is one of the first mass uses of the smart card. However, for 20 years, bank innovation has been slower to integrate new technologies.
Maybe for fear of risks (regulatory in particular) or lack of business interest. But now, the banking sector has no choice. It must follow the interest in the many technological innovations and especially exploit them for its own benefit before others do it for it.
Banking innovation and technology: big data
The “Big Data” corresponds to the vast amount of data that companies possess or acquire in the course of their activities.
In the new era we are living, data is at the center of all concerns. It is a valuable asset for banking innovation. And the use of which can yield a lot, from the moment we know how to acquire, store and especially analyze and treat it.
Banks have a lot of astronomical data on their customers: data collected sometimes for decades! Banks know what their customers are spending and what their consumer habits are. They see lifestyle changes, divorces, deaths, births. They could find business partners willing to pay a lot for this type of information. An opportunity for banking innovation.
Of course, banks will have to comply with data protection regulations. Because the regulator is very lookful on these aspects. It is, therefore, a significant challenge that presents many opportunities but also many risks.
Blockchain technology and banking innovation
In 2016, the blockchain – the distributed technology that underlies the digital currency “Bitcoin” – attracted massive interest from banking institutions, especially Anglo-Saxon. A large number of banks are already looking to integrate blockchain applications into their existing IT operations. This is an exciting banking innovation.
In parallel, many startups are working to find solutions based on this new technology, which allows certain operations to be automated at a lower cost, and by offering more security.
The blockchain applied to the bank is no longer science fiction!
At the end of 2016, a major European bank (BNP Paribas CIB not to name it) made instant payments between two “corporate” clients in two different countries. Thanks to Blockchain technology.
Technological advances of the bank: artificial intelligence
2016 saw the victory of AlphaGo, this AI program developed by one of Google’s affiliates. One of the world’s best Go players. All the experts thought of it as a vast banking innovation. And it will arrive sooner as you may think. This victory is, therefore, a new step in the development of AI.
We are only at the beginning of this wave of AI, and this is developing at a supersonic speed.
Especially in the bank, we should see the number of intelligent personal assistants who can interact with us, talk to us in natural language. Finally, offer us savings products and perform tasks like bank transfers or even take out a mortgage …
Banking innovation rising now
The development of digital and its host of changes is an opportunity for the banking sector: to reinvent itself, of course, but before that, improve the customer relationship by offering more flexibility, access to a range of more modern services, secure and available.
They organize themselves well and invest in the right technological tools and the right teams to deploy them. Above all, the companies of the bank are now able to position themselves at the forefront of this digital transformation, thanks to banking innovation.