Scaling Digital Innovation
With the ongoing digital disruption, incumbents have seen their competitive advantages, whether reach through physical channels, product differentiation, or customer loyalty, erode steadily over the years.
To a great extent, this is because the new digital-native players are using modern technology and innovation to diminish those advantages while differentiating themselves with embedded finance offerings, great experiences, and highly cost-efficient services. The vertically integrated pipeline business model is unraveling as new models built around platforms and ecosystems take their place in the banking industry.
In this digital-first era, to stay competitive, we recommend a holistic approach to innovation along three key dimensions.
Reimagining Your Bank’s Business Model for a Brave New World
A dynamic business environment has accelerated the need for business model reimagination. Broadly, a bank can revise its business model by focusing on an area of excellence and differentiation, Or by evolving its existing model into an alternative platform model, such as marketplace banking. And while each bank will chart its path based on its unique circumstances, all banks, without exception, will need to expedite business model innovation to survive the next normal.
With its cloud-native, functionally rich, and open solution design, Finacle is well-placed to support all types of business model requirements. Highlights include:
Scaling Organizational
Innovation Capabilities
In our annual global innovation survey, only 9 percent of banking executives rated themselves as “innovation pioneers”. Another 32 percent said they were “fast followers”, leaving 59 percent in the mainstream or laggard categories. With the growing competition coming from incumbents, challengers, and digital giants, the status quo is unsustainable.
To help drive continuous innovation, Finacle partners with banks to elevate innovation capabilities across the key dimensions of people, process, technology and data. Highlights include:
Accelerating Product Innovation
Finacle offers a complete range of digital banking product engines such as deposits, loans, trade finance, wealth management, payments, and cash management to help banks design products and services for various customer segments. Banks can go-to-market faster with Finacle’s flexible product factories that bring global innovations to life with simple configurations. Banks running on Finacle have realized an average 17% improvement in speed-to-market with new products and services. Highlights include:
Scaling Channel Innovation
Unfolding digital trends have put a significant urgency on channel innovation. For illustration, 20 years ago, 50 percent of banking transactions occurred inside the branch; today, that figure is barely 5 percent since 95 percent of transactions happen in digital channels. And it is expected that in the next few years, 50 percent of bank transactions will move to non-bank, third party channels, thanks to embedded finance and open banking initiatives.
Finacle help banks drive channel innovation to engage better with their customers, employees, and partners. Built on a unique engagement hub, Finacle suite helps banks onboard, converse, service, and sell better with customers. In fact, banks running on Finacle have realized an average 19% improvement in their NPS scores. Highlights include –
Driving Ecosystem Innovation
The traditional pipeline based banking model, driven exclusively by owned products and channels, is becoming ineffective in the digital environment. Progressive banks realize that opening up to new and diverse partner networks within a larger ecosystem is the way to differentiation and new sources of revenue.
They strive to win, serve, engage and retain customers by continuously creating improved and new value with ecosystem partners. Finacle enables banks to achieve this by offering a range of capabilities, including –
