Global banks ‘expect digital investment returns’
Written by Anthony Strzalek
More than half of global banks expect their digital investments to yield “measurable returns” by 2020, new research has shown.
The survey, conducted by Infosys Finacle and Efma, revealed that technology investments in 2018 will revolve around ‘topical’ areas such as information security, advanced analytics and open banking APIs, as opposed to ‘future-looking’ areas such as conversational AI, robotic process automation, the Internet of Things, augmented reality or virtual reality.
However, 70 per cent of organisations planned to support a conversational AI solution, with close to 25 per cent having already made investments in AI.
According to the report, retail banks continue their thrust on innovation in all functional areas, with customer experience and channels (both at 78 per cent) being at the forefront. Other segments that have witnessed higher spends in innovation include products (67 per cent), process improvement (64 per cent) and marketing (57 per cent).
The research, in which over 300 bankers globally participated, also found that retail banks consider large technology companies, challenger banks, and smaller FinTech startups as threats to their growth.
Similar to the 2016 report, the greatest impact of transformation is expected to be in the areas of payments and mobile wallets.
More than 50 per cent of respondents expect to see a measurable ROI from their investment in innovation in one to three years, with more than 30 per cent expecting to see results in less than a year.
Sanat Rao, chief business officer and global head of Finacle, said: “The report clearly reflects the sentiment we are witnessing globally. The case for investing in digital transformation and innovation has never been stronger, with changing customer preferences, technology upsurge and competition from the non-banking sector.”
Jim Marous, author of the study, added: “As we expanded the scope of organisations included in this year’s study, we find a significant difference in the innovation maturity and commitment to technology investment between the largest and smaller organisations, with smaller firms appearing to fall further behind market leaders.
We also see a continued focus on iterative innovation as opposed to disruptive innovation, limiting the potential benefits of big data, advanced analytics and digital technologies.”