Jerry Norton

Top 5 technology trends for corporate and transaction banks

As part of the 2017 CGI Client Global Insights, we interviewed more than 1,300 business and technology leaders across 10 industries and 17 countries to get their perspective on top trends within their sectors, as well as their corresponding challenges and priorities. In this blog, I discuss some of the key trends and insights coming from the corporate and transaction banking (CTB) executive interviews.

Overall, we see an acceleration in the evolution of emerging technologies, integrated physical and financial supply chains, real-time payment processing and sophisticated protection as banks respond to customer demands and increasing competition to reduce costs and enhance revenue.

With the landscape changing fast, what are some of things we can expect to see in 2018?

  1. Continuous reorganization and change to drive digital agendas

    CTBs are moving forward by embracing new business models to secure their place in a digitally connected economy. As enterprise-wide digital strategies are implemented, we expect bank executives to adapt, change and evolve the organization of their business. More than half (55%) of the CTB executives we interviewed are leveraging a centralized team to drive the execution of their digital transformation plans, and a majority (64%) is leveraging external partners. Because the business model change is enterprise wide, both the CIO office and lines of business are jointly engaged in the change. Throughout 2018, we expect to see efforts to attract new digital talent and leadership, and an increasing number of banks organizing along agile principles.

  2. Enabling the global adoption of real-time

    One of the biggest examples of the industry-wide change taking place in CTB is the global adoption of real time or instant payments—albeit at different paces by country. In some regions, this change is driven by regulatory pressure, while in others by the need for greater economic competitiveness and productivity. However, for our CTB clients in 2018, we expect to see a renewed focus on transforming the IT ecosystem to operate in real time. We also anticipate a greater focus on cost reduction through technology simplification and the adoption of new delivery models such as agile development, DevOps and cloud computing.

  3. Rise of open banking and emerging technologies

    New technologies, especially open APIs and blockchain, are changing how the CTB industry works. Open APIs unbundle the banking value chain and enable banks and non-banks to create new services, as well as extend existing services, accelerating already intense service competition. Blockchain (or distributed ledger technology) is being piloted to connect financial and physical supply chains and remove historical paper-based inefficiencies. Intelligent automation and artificial intelligence also are on the rise. Each of these emerging technologies is a potential game changer in its own right, but together they promise to bring deep transformation to the CTB industry.

    These “hot topics” have been making waves for a while, but we expect to see them move into production environments in 2018. One possible exception is artificial intelligence, which still needs to mature and be paired with more robust and accessible data before its full potential is realized. The CTB executives we interviewed are primed to execute enterprise transformation at pace, including the adoption of these new technologies.

  4. Corporate servicing becomes omni-channel

    In 2018, we expect to see a big emphasis on customer centricity. We are witnessing the next step in corporate servicing as more corporates demand support across all channels. While progress has been made in the digital servicing space, corporates don’t want a “digital-only” servicing model. Banks are being asked to join the physical with the digital, and many are taking the opportunity to drive market differentiation through more customer-centric business models. They also are driving more innovative value-add services through the use of intelligent automation and data analytics.

  5. Innovation extends to protection

    Money laundering regulation, anti-fraud measures and security continue to be top priorities for CTB executives as threats continue to escalate. In response, they’re looking to new technologies to support them in these areas. In 2018, we expect to see machine learning to be used more readily to help drive efficiencies and improve control in both risk and fraud procedures.

    For more insight on 2018 CTB trends, we invite you to request a copy of our full CTB insights paper. Or, feel free to contact me with any questions you have.

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