From the perspective of most people, most financial institutions seem to have it all together. Most individuals share positive experiences with their financial institutions on a daily basis with little usually going wrong. Today’s financial institutions offer their customers a huge range of services beyond the simple check-cashing and debit card privileges.
Additionally, today’s consumers benefit from worldwide banking institutions that offer account access via secure online portals, so that no matter what hour of the day it is, the bank is accessible to them. These services pale in comparison to the types of services that have now become a part of everyday banking including mortgage financing, investment funding, and business loans, and these are just a few examples. However, despite the huge technological advancements that have improved the world of finance, financial services organisations still face many challenges.
Continue reading to learn more about some of the major challenges that financial organisations face today.
Data Security And Breaches
Billions of financial transactions occur in one day worldwide. For this reason, data security and breaches are of utmost concern today, especially in an online platform that is constantly being attacked by hackers. Because technology is available to anyone with the wherewithal and the motivation to learn, the types of breaches that open up consumer’s information to malicious hackers is a very great concern. While large organisations have experienced these types of breaches, financial information is very valuable and a security breakdown could be disastrous for a major financial institution.
Aging Technology (Automation)
Another major concern for financial institutions is that even in a very tech-savvy environment current technologies will soon become outdated by AI. Worse yet, this technology will not only create opportunities for consumers to become less reliant on customer service, but it also might create situations where whole professions will be eliminated simply because consumers will have more information and will not need help. In what is commonly referred to as packaging services with technology, consumers are soon to double as bankers.
Evolving Customer Marketing
Today’s marketing strategies are split between the traditional mediums such as television, radio and print and a mix of online avenues such as social media, SEO and other digital marketing strategies. While these approaches are successful for many institutions, there is no one-size-fits-all solution when it comes to marketing. However, with more information available about new markets and consumer behaviour financial institutions are in a position to create products that meet the needs of the general public. With that said, this creates its own set of issues in keeping up with emerging trends and always having your finger on the pulse.
Shortage On Talent
Another problem that financial services institutions have is having access to top talent. While the virtual platform has made it very simple for businesses as a whole to hire talent from around the world, for financial services organisations, finding talent is a concern. Not that there are not plenty of qualified candidates in this field, but technology is re-inventing itself in the finance sector all the time. For financial organisations, this means finding candidates that not only have financial acuity or an understanding of the financial industry but they will also have to be quite adept at technology as well.
As the world increasingly becomes smaller simply through technology, competitors with more resources and money can potentially drive out the competition. One of the main reasons is because larger organisations, by virtue of the fact they have more wealth, can offer consumers a range of services, and stellar products. When competing on a global scale, smaller organisations might not be able to compete simply because they do not have the resources or talent.
Facing The Challenges
Every industry has challenges they face coming into the future. For those in the financial services, these challenges mostly relate to technology and its impact on the industry. For consumers, when tackled correctly, these challenges can be the beginning of great products and a brighter future for the financial industry as a whole.