As the economic crisis prolongs to unfold, the financial service industry faces severe challenges. The crisis is rooted in continuous imbalances, including elongated periods of low interest rates, rapidly increasing asset prices, and gigantic credit and savings imbalances.
Previous decades of outstanding growth and capitalism at its best have now caused the market to become accustomed to strict credit, growing governmental interference, sluggish pace of globalization, and very less economic growth. With escalating regulations in the United States and lessening accessibility of credit, the industry faces a significant risk of stunted growth. The global recession is also upsetting the financial segment because of capital markets and diminished aggregate demand.
This article will provide influencers, employees and stake holders in the financial service industry with the top unique and timely trends to keep in the forefront of their growth strategies for the next five years. These key trends will form the post financial crisis in a holistic and methodical manner.
Top Key Trends
Global banking: According to the World Bank, even though many banks such as American Express, Citibank and JPMorgan Chase carry out business in multiple countries, they are relatively local in the United States. In order to nurture, the financial business will have to penetrate emerging markets. For companies that have a more insistent growth stratagem, the spread to emerging markets such as Africa and Asia presents unparalleled opportunities for profit and increased market share.
IT Platform Sharing: Network World corroborates that financial service firms' business strategies must be changed for the new dynamics and intricacies of today's market. Instantaneous access to information and integration along product lines and geography are a necessity for future success. With the requirement to supply information to a global market, firms must reduce cost. One cost effective initiative is the utilization of platform sharing; like mobile companies that collaborate with local companies in order to diminish cost and increase access, financial firms can also follow the same.
E-Banking: A special report sees that with 3.5 billion people with smart phones and an expected 10-20% year over year growth, individual and business banking transactions are conducted through smart phones progressively. Thus, E-banking competence is quickly becoming an increasing requirement in order to challenge in the marketplace. E-banking competent companies with its essential flexibility and differentiation in the market through Internet-based service applications will flourish.
Mobile Money: The enhancement of smart phone usage in emerging markets makes mobile financial transactions a safe, low cost scheme for the financial sector. It is an effortless approach to transfer money to family and acquaintances, money is sent, and withdrawals cum payments can be made without ever going to a physical bank or payment center
Self-Service: Self-service and the customer should be a primary focus for firms in this new financial service world there is a self-service portal which organizations can acquire, so customers can ensure the status of their account and gain instant access to available services. Client’s inquiries and concerns are addressed more rapidly. This technology automates many processes; the result is that staff workload is reduced while council operates quicker and more efficiently.
With the consumer at the center of most trends in financial service firms, creating novel values for their current and potential clients beyond current expectations will be a pinnacle priority. The necessity for convenience varied with technology makes mobile money a great initiative in the emerging as well as the developed markets. Many firms have Swift pay, the ability to pay without swiping the card, as component of their credit card services. An embedded chip in the credit card allows payments to be made by putting the card close to the payment processor. Mobile money will be an extension of payment and money transfers without the necessity for a card, the want to go to a physical bank, or to utilize Net banking. Payments, Fund transfers, deposits and withdrawals can be made with a cell phone.
Today's antagonism is fueled not just by profitable clientele, but also by the organizations that are the most efficient and price effective. Procedural and cultural clash will result from expanding into unknown markets as seen by the history of Citibank. But in the extended run, rigid regulations, new technology and enhanced business processes will cause expanding in emerging markets not only to change the demographics of the clients but also to better the global economy and the future of the financial services industry. Preserving the previous trends at the forefront of managers' strategic plans, financial firms will bounce back larger and better than ever.