This trend will continue in 2020, as it solves the issue of scalability with banks, but is creating unregulated depository risk in the banking system.”, Christopher McClinton is CMO at Finxact“Historically, banks have aspired to generate a buck of revenue for every 50 cents of non-interest operational expense. He once again predicts 10 key trends that are worth bankers’ attention over the next 12 months. The People’s Bank of China is nearly there. As tension over immigration simmered in the U.S., one bank after another — JPMorgan Chase, then Bank of America, then SunTrust, then Barclays— pulled out of funding the private-prison industry. Mobile Everything, But Same Old Banking It’s 2020, and things could get stormy for banks. Whether it’s freezing your card when it’s lost or providing you with analytics on where you money is going, customers can now take these actions from their mobile apps — without going into a bank branch or calling customer service. We power payments innovation to help banks, payment providers and other players in the value chain win. With the focus of Open Banking shifting to consumer data rights, expect banks to go full force on trust in 2020—protecting customers’ shared data even more and using it to add advisory value. The industry can help SMBs combat their cash flow issues by increasing the speed of payments through innovations such as next day credit card deposits and enabling faster settlement on ACH payments. To put pressure on competitors, leaders will also need to use their tech strength to grow revenue via higher assets, liabilities and material fee income. While customer experience can be tricky to quantify, client turnover is substantial, and client loyalty is rapidly becoming an endangered idea. Powerful forces are shaping the industry PwC Retail Banking 2020 5 Against this background, 70% of global banking executives believe it is very important to form a view of the banking market in 2020 – to understand how these global trends are impacting the banking … How banks respond will determine whether they experience success or failure. Trends in Banking in 2020 and AI since the COVID-19 lockdown: The concepts of money and transactions have seen it all! Many fintechs are essentially creating their own internal, “mini-core processors” or “banking ledgers” that record, track  & process customer deposits. The end-user perceives money as a potential for work and growth and they care less and less about the idea of a columned building being the gatekeeper for that potential. “I see 2020 as the year of the consumer experience for digital banking. Meteorologists make a distinction between long-term trends … Financial institutions will need help embracing AI to its full potential. Strategies to knock down that stubborn ratio a few percentage points here and there have historically been based on reducing branch footprint, optimizing branch formats, transitioning teller-intensive activity to digital channels, bill-pay adoption, among other tactics that did not include eliminating the technical debt that’s actually ballooning the numerator. Digital Technology Trends in Banking: 2020-2025. Client loyalty is a product born through sturdy relationships that start by comprehending the client and their expectations. In 2020, banks will need to make every touch point, from talking to a bank teller in-person to making a transfer between accounts on your phone, as frictionless and helpful as possible for consumers. In 2020, banks will finally get serious about translating their information advantage into a competitive advantage through data, analytics and actionable insights that will allow them to intelligently engage with their customers. In Bank Innovation’s State of Banking Innovation in 2016 survey, we asked the survey’s 171 respondents — the majority of whom self-identified as bankers —what they thought banking will be like in 2020. The start of a new decade is a good time to forecast what’s ahead for retail and commercial banks in 2020. As digital banking technology continues to develop in popularity and expand with the latest digital banking technology trends, here are some mobile banking future trends to look out for in 2020. Here are ten different ways they responded: 1. According to a survey of more than 1,000 U.S. banking customers by Statista, over half of respondents said they were either already using a digital-only bank … Top Mobile Banking Trends Coming in 2020. Many fraudsters look for loopholes in the process or registering, activating or using a mobile device in relation to an online account or transaction. Share share. “Mobile becomes the standard platform for financial interactions. 2020 was a massive year in the world and in financial services. The European challenger banks are well-capitalized, but they don’t have the same brand recognition here as they do in Europe and will won’t necessarily be going after the same type of customer in the U.S. as they are currently serving in Europe.. Consolidating their position requires newcomers to convince investors there’s gold at the end of their customer acquisition rainbow. LendingClub’s merger with Radius Bank received conditional approval by the OCC. These investments have primed the industry for innovation, but there is still more work to do. Fintech and modern financial services have to go beyond this mental model of banking and focus on the success and welfare of its customers. The ability to make intelligent decisions about applying the right level of security at the precise time is going to be largely driven by machine learning. 1. It’s 2020, and things could get stormy for banks. 2020 will be less about the building blocks of real-time payments needed by banks and more about setting up new real-time payments services that attract consumers and fintechs.”, Ximena Aleman is the chief business developer at Prometeo Open Banking“2020 will be Open Banking MVPs year in Latam. But acknowledging the elephant in the room, here are 10 issues, trends, and innovations that experts expect to have the biggest impact on the banking industry in 2021 and beyond. March 4, 2020… The banking industry plays a huge role in the global economy and is undergoing a huge technological shift. This is just one scenario where we’re seeing “unbanking” taking effect – something that will continue to affect traditional banking institutions going into 2020.”, Richie Serna is CEO and cofounder of Finix, “Historically, open banking in the US has been driven by smaller niche banks that are licensing out their charter to innovative tech companies. “According a new study from QuickBooks and Wakefield Research, 80 percent of small businesses feel stressed about their cash flow, and the time it takes payments to process plays a huge role in this. Green Dot is best known for its prepaid cards and managed debit card programs its managed for big brands. Following this trend will enable banks to gather more information about their customers, anticipate their needs, and ultimately capture what is coveted most — primary ownership of that customer relationship. Adobe Stock. We see 2020 as the year commercial banks went from digitization to digital by building on these investments and truly unlocking the power of their data. When the right strategic partners are selected, there shoul… Voice Activated Commands for Banking … Instead, in a bid to become the primary account, I think we’ll see companies layering on automation and budgeting tools to help customers improve their overall financial health.“, Harsh Sinha is CTO at TransferWise“Newer fintechs (Chime, N26) and established technology companies (Apple, Google) have digital-first mindsets that promote transparency and empower customers to take charge of their finances. Banking industry trends, Q3 2020. Ultimately, these improvements to payments processing gives small businesses access to funds they desperately need right away, rather than waiting several days for a transaction to post, improving their cash flow and opportunity for success.”. 10 questions to assess digital banking maturity, Payments Pulse Survey: Two ways to win in payments. Following 2019’s payments M&A, we expect many mid-sized banks this year to seek whole-bank deals or selective business acquisitions—emphasizing technology scale and in-market distribution unions. For many, a 50 percent efficiency ratio still remains an aspirational threshold. No items found. This analysis outlines the top trends in retail banking for 2020. Chime recently opened offices in Chicago, Stripe opened offices in Mexico City, Salt Lake City now has Galileo, Plaid and WebBank while Atlanta has a healthy mix of established fintech companies and emerging startups that are changing the face of payments. So what can banks do and how can they get there as we move into a new decade? It has transformed up to a great extent, but the technological impact is going to bring a major transformation in the upcoming years. Join the conversation by following us on Linkedin and other social media. There is already a separate, active Accenture Careers account with the same email address as your LinkedIn account email address. Expect to see more new fintech hubs popping up in 2020 and beyond.”, Leo Gill is vp of innovation, banking solutions at Bottomline Technologies. We will continue to see this trend of competition for the bank account of the consumer. Unexpected account charges are one reason why some two billion adults remain unbanked. ‘Nimble product factories’ at the core level that can rapidly define position (loan or deposit) behavior and expose it via RESTful APIs will reduce the cycle from product inception to deployment by an order of magnitude. Azlo is creating an ecosystem that focuses on the survivability of new businesses which entails many diverse aspects above and beyond traditional banking services.”“Intelligent services are also becoming more and more prevalent as the barriers to starting a business are disappearing. Consumers sometimes avoid the monthly fees of traditional bundled bank accounts and instead use the services of check cashers, which are often associated with high one-off fees. In a similar way, bankers need to manage day-to-day developments while adapting their strategy in response to longer-term shifts. Process flows also need to be streamlined. As PSD2 is implemented in the US, a new wave of innovation will change B2B and B2C banking as we know it. The ranking of the top ten trends and predictions was done by providing a list of trends identified by a panel of leading industry influencers and asking banks, credit unions and the supplier community globally to provide their top three predictions for 2020. Consumers are increasingly aligning their buying to socially conscious providers. With change in the banking industry happening so quickly, it is impossible for any organization, of any size to “go it alone.” The value of establishing the right strategic partnerships has never been greater. As impairment charges rise and signs of a mild downturn mount, banks over the next 12 months will more closely watch the creditworthiness of their loan portfolios to minimize risks and losses. With BigTechs and Fintechs influencing the financial services space, retail banks are investing in digital technology and collaborating with third-party providers to drive customer centricity and stay competitive within an evolving banking ecosystem. Financial institutions are still holding back from providing enough data to use AI in its most complete from in the effort to prevent fraud. Over the years, we’ve seen some incredible new technology being built – both within and outside of our industry. Most Gen Z-ers also grew up during the financial crisis of 2008, so providing resources that teach about money management and emphasize the ability to save will offer a desired sense of security.”, “From Square to Amazon to Microsoft, in 2020, neo and challenger banks will coalesce around a set of features centered around possession of the stored value of that customer. Trend #1: AI in Banking. There is generally consensus, though, that consumers are the beneficiaries of the increasing competition in the space. Because of this the corresponding increase in the attack surface that fraudsters will have access to gets worse. New banks Banking 2020: Technology trends and the future of banking. close Close the share menu; Financial, Executive and Professional Risks (FINEX) N/A. Additionally, encouraging businesses to embrace omnichannel payments will help to provide them with the confidence of never missing a sale. Not just technology; changing customer behavior, digital transformation, and growing regulatory requirements have made it obvious for the banking industry … Banks are now competing with new entrants in the space, fintechs and platform providers, all who at their core leverage fine-tuned data and analytics and have exceptional customer engagement skills. Read our 2020 banking and capital markets outlook to understand how banks can fortify the core for the next wave of disruption; Check out our … This year we’ll see more people continuing to crave that personal experience that comes with visiting a bank in person, and the death of bank branches will be greatly exaggerated. To date, we’ve seen the most traction for challenger banks targeting those that aren’t currently served well by traditional banks in the U.S. The ultimate objective is to improve the customer experience with an enhanced value transfer. Quontic Bank released a checking account that pays rewards in bitcoin. Beginning in 2020, the winds of innovation will change direction, emanating outwards from the next gen cores into the marketplace of financial services.”, Michael Praeger is CEO and co-founder at AvidXchange “Banks should consider that Gen Z is much more research driven than their Millennial counterparts. BaaS is defined as the sharing of a bank… Multiple, interconnected phenomena continue to affect and threaten banking—they include everything from M&A to fintech profitability to credit-quality issues. Banks have taken notice and understand that, “the best way forward is to join them.” Expect to see more investments, partnerships, integrations, and M&As between traditional banks and fintech players in 2020 as well as the mainstreaming and adoption of products and solutions stemming from partnerships made in the past few years.”, Craig Peasley is director, marketing, Adobe Document Cloud, at Adobe. From Elevon to FiServe to First Data to Finix and Green Sky and Kabbage – it’s becoming a hotbed for new fintech ideas and talent. See the digital banking industry trends of 2021. The revamped service allows SMBs to smoothly transition across accounts as well as deposit checks, pay bills and make transactions. The main services offered relate to storing, transferring, extending a credit against, or managing the risks associated with the various forms of wealth holding thereof. More specifically, we wanted to know what they thought would be the biggest banking theme in 2020 — something that would really move the needle for the industry. The banking industry is a modern network of financial institutions authorized by the state to supply banking services. Digital technology drives three major banking industry trends: digital transformation, brand specialization and partnerships. With the advent of banking-as-a-service (BaaS), 2020 is going to question what this service truly represents. More banking industry trends and insights. A recent study from Adobe found that 75 percent of consumers said they still believe physical bank branches matter and 70 percent have visited a physical branch at least once in the past month. It started with the barter system … These insights will be useful across the bank from relationship managers to product and management teams, and directly to the bank’s customers – all powered by a seamless user experience. Experts share their views on top banking trends in 2020. When complex fraud detection models are able to be read and understood by people, then we firmly believe the power of AI will shine through across the banking industry.”, Rishav Chopra is head of strategy, operations & revenue optimization at Intuit. It’s safe to say that the commodification of the bank account is in full swing, but how challenger banks will differentiate themselves will take center stage in 2020 (and it can’t simply be with competitive interest rates). New entrants have attracted millions of customers. ... 2020 and has been extended through August 8, 2020. This kind of speed and frictionless commerce are vital to stay current and explore the many creative directions that younger consumers have.”, Carson Lappetito is president of Sunwest Bank “Financial technology such as smartphone payments, better integration and mobile banking, will become an even greater focus in the banking industry, as innovative companies continue to disintermediate banks by offering a vastly better customer experience.”, “We can also expect to see continued regulatory scrutiny placed on depository fintech companies, due to the current lack of regulatory oversight and FFIEC compliant cybersecurity programs. Open Banking. With more and more mature fintechs in the financial space and banks totally aware of their need to push innovation initiatives in the region, there will be an incremental interest in crafting new ways to leverage data. Large banks and legacy financial providers made unprecedented venture capital investments in up-and-coming disruptors in Silicon Valley and around the world. Key issues to watch. 20 percent of their consumers indicated that they would switch their checking account to one which rewards them in bitcoin. I bet most innovative companies in each market will jump first and go further, gaining not only experience in this space but also customers’ sympathy and loyalty.”, Cameron Peake is co-founder and CEO of Azlo“Banking as an industry is becoming irrelevant. Banking Industry Trends 2020 Financial services clients expect meaningful and personalized experiences through intuitive and straightforward interfaces on any device, anywhere, and at any time. The variety of banking players is clouding business model nomenclature and, thus, incumbents’ responses. 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