There is no question that technology is impacting every element of our lives, simplifying and providing alternative processes and enabling new sources of value to be identified. We surveyed over 500 professionals in the financial services sectors and our latest research report highlights how disruptive technology and digital innovations are impacting the industry.
Collaborative ventures and the platform economy are empowering new and exciting ventures to succeed in multiple sectors, following in the footsteps of industry giants Amazon, Alibaba, Apple, Uber and Airbnb.
It's a revolution that cannot be ignored. At the same time, the way some organisations are embracing digital transformation to deliver value to their customers. Industry analyst IDC has predicted that businesses failing to take on the digital transformation challenge risk seeing two-thirds of their addressable market vanishing by 2022.
And recent research from Bain & Company found that revenues for digital leaders had grown by 14% over the previous three years, more than doubling the performance of digital laggards in their industry sectors.
In the finance industry, disruptive technologies like artificial intelligence (AI), robotics, Regtech and blockchain are also impacting the way firms operate. Early adopters are reaping the benefits of applying these technologies to business processes, especially time-consuming manual tasks that can now be automated.
Financial services firms responding to research that Intertrust commissioned in September 2018, appear broadly positive and optimistic about how technologies will bring even greater value to their organisations.
Outcomes of the research show how disruptive technologies are not necessarily completely replacing current processes and how firms are harnessing the benefits of emerging technologies to improve efficiency and the quality of customer service. Interestingly, while multiple processes can now be automated, the human touch is still important and irreplaceable for many.
Understanding where the value-add is for organisations embracing technology innovations is vital. It's important to know how technology unlocks value in business, whether it's derived from bringing client-centric solutions to the forefront, creating insights and assessing credit-worthiness from multiple data sets, using blockchains for KYC purposes or automating customer interfaces.
Yet the skills shortage is a huge challenge for firms looking to benefit from the power of technology. There's a clear demand for cyber and data-handling skills, and, for example, fund managers are seeking the relevant skills and expertise to assess the digital health of assets alongside financial metrics. For corporates, there's a need to bring technology expertise onto their boards to help guide business innovation.
Perhaps unsurprisingly, cyber security poses the greatest risk to businesses. Whilst new technologies mean it's an exciting time for the financial services sector, there are still challenges and risks. The ever present threat of cyber incidents and data breaches are of huge concern to respondents surveyed for this report.
The demand for Regtech solutions will continue to increase over the next two years. As companies have changed, so have the demands of the regulators and the tools used to meet such obligations. Technologies like blockchain hold huge potential to simplify regulatory reporting in areas like KYC, although much of this is in its infancy.
We hope you find our report both interesting and insightful and that it will help inform and drive your own strategies as the industry moves towards a more digitally-focused future.
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