“At least 40% of all businesses will die in the next 10 years… if they don’t figure out how to change their entire company to accommodate new technologies.” — John Chambers, Cisco Systems.
In most of the industry sectors, this change is being facilitated through digital transformation. Almost all the industries are shifting to digital technology trends to have a competitive edge in the market. Needless to say, the banking industry is also tapping the potentials of digital technology to serve their customers better.
Gone are the days when banking services were defined by long queues and tedious paperwork. Digital, app-based, and text-based banking has now taken over the business. At the core of this digital transformation lies better consumer experience. Accessible smart devices and high-speed internet coverage has created many lucrative digital banking opportunities.
According to a study by Deloitte, banks, globally, invested US$ 9.7million to enhance their digital banking capabilities in the front office alone in 2018. Their study stated, ‘for retail banks, online and mobile channels have become as important – if not more important – than branches and ATMs.’
Both traditional banks and disruptive FinTech start-ups have realized that investing in digital engagement is the key for enhancing customer acquisition and satisfaction.
In the current business scenario, the digital-only banking trends, especially, in the age group 25−35, are paving the way for digitalization in the banking industry.
According to FinTech Times, more than 24% of the US citizens have switched to digital-only banking services, and only 34% individuals below the age of 35 carry cash with them.
Customer experience has also become a competitive differentiator since the COVID-19 pandemic. Customers are now looking for simpler, intuitive, and seamless self-services for banking through digital or mobile-only platforms. A recent article by The Economic Times highlighted that 97% of millennial today rely only on mobile banking facilities.
The traditional banking systems are yet to gain traction in terms of digital transformation. Customer loyalty for these banking providers is highly subjective. According to Deloitte Center for Financial Services’ global survey, two-thirds of the global consumers, especially in Asia-Pacific, still rely on their primary bank’s brick-and-mortar establishments. These are mainly based on emotional quotient associated with these banks.
Barriers for Digital Transformation in the Banking Industry
Most industries are embracing the digital disruption and investing more in technologies that aid this transformation. The legacy technology, system integration, and erroneous software testing approaches are the biggest barriers for the banking industry.
According to The Economics Times, survey of 350+ banks has shown that only 17% have succeeded in becoming digital at scale. This has led to prolonged system failures, dependence on legacy systems for basic functionalities such as applying for loans, creating a new account, or bill payments.
According to The Indian Express, HDFC, India’s largest private-sector bank, faced a major backlash in December 2020 due to outage in their digital banking platforms. The bank’s digital banking platforms, credit card sourcing, and all digital banking businesses under the Digital 2.0 (to be launched) program were put on hold following this goof up. Their business dipped when the Reserve Bank of India stopped all digital / mobile banking activities until the lapses were examined.
Switching from legacy systems to digital platforms has become inevitable for full stack banks to up their game in the market. Boosting up their testing mechanism for every software or application can help them develop such platforms and exceed customer expectations, consistently.
The banking services providers was required to heavily invest in AI-powered test automation systems for reducing their QA timelines and assuring seamless digital services. For such requirements, these banks need reliable and efficient testing tools for their digital solutions.
ignio AI.Assurance is the perfect software testing solution for them. It is a convenient software testing platform that leverages AI / ML capabilities to provide the highest level of automation through all stages of testing. Automated test suite creation is a distinguished feature of the product, and it makes testing simple, quick, and easy. Developers can leverage its intuitive impact analysis and self-healing capabilities for seamless testing and defect management, while its interactive dashboards help in achieving valuable business insights.
A big threat is looming over the traditional banks from technology giants, FinTech companies, and early adopters. Experts believe that the FinTech companies and tech providers will take over a lion’s share in banking innovation. Coming up with agile and seamless digital solutions such as internet and mobile app-based banking services is the only way forward for traditional banks to remain competitive in the market. These demand end-to-end testing platforms for software and or applications. Adopting to ignioTM AI.Assurance software testing platforms can prove to be a major game-changer for these banking enterprises to embrace the change.
So, are you ready to adopt digital transformation? Are you ready to deliver better software, faster to stay ahead of your competition?
Click here to know more about ignio AI.Assurance.