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How can banks change ‘Innovation’ from buzzwords to differentiators

How can banks change ‘Innovation’ from buzzwords to differentiators

In today’s rapidly evolving financial landscape, innovation is no longer just a buzzword; it’s a necessity. Banks must transform their innovation strategies into differentiators to stay competitive. This blog explores how banks can effectively change ‘innovation’ from a buzzword to a decisive competitive advantage. We’ll also explore examples of financial institutions embracing innovation and leveraging Digital Corporate Banking Solutions and Digital Banking Transformation to create next-gen services.

INNOVATION & TRANSFORMATION

The Changing Face of Banking

The banking industry has been in the middle of a significant transformation. Disruption from fintech startups, changing customer expectations, and the impact of digital technology have pushed traditional banks to reevaluate their strategies. This is where innovation comes into play.

Innovation as a Necessity

Innovation is no longer optional for banks; it’s necessary for survival. Financial institutions must constantly explore new ways to fulfill customer demands, reduce operational costs, and improve services to stay relevant and competitive.

Digital Corporate Banking Solutions

Digital Corporate Banking Solutions are at the forefront of innovation in the banking sector. These solutions empower businesses with efficient and streamlined banking services. Recent innovations include digital payment platforms, cash management tools, and real-time financial insights. Institutions like J.P. Morgan and HSBC have embraced these solutions to enhance their corporate banking offerings.

Remarkable Innovations in Banking

Innovation is not just a concept; it’s a practical approach that banks adopt. Let’s explore some remarkable examples:

1) J.P. Morgan:

J.P. Morgan has been a pioneer in embracing innovation in the banking sector. They launched their blockchain-based digital currency, JPM Coin, to facilitate instant payments and enhance the efficiency of cross-border transactions. This not only reduces transaction times but also minimizes counterparty risk.

2) HSBC:

HSBC is committed to making banking more convenient and secure for its customers. They introduced biometric identification, allowing customers to access their accounts using facial and fingerprint recognition. This innovation enhances security and simplifies the user experience.

3)Citibank: 

Citibank’s approach to digital transformation involves creating a comprehensive digital ecosystem. They offer digital banking services, including a mobile app with real-time account management, mobile check deposits, and customized spending insights.

Challenges and Approaches to Success 

As banks strive to convert innovation into a differentiator, they face several challenges:

1) Cultural Shift:

Banks must foster a culture that encourages and supports innovation. This entails a mindset shift, employee training, and the freedom to experiment.

2)Data Security:

With increased digitalization, data security becomes a paramount concern. Banks must invest in robust cybersecurity measures to protect customer information.

3)Regulatory Compliance:

Needless to say, the banking industry is heavily regulated. Banks must ensure that their innovative solutions comply with all relevant laws and regulations.

To succeed, banks must approach innovation systematically:

1) Invest in Research and Development:

Allocate resources to research and development to continually explore and implement new technologies and services.

2) Customer:

Centric Innovation: Focus on solutions that directly address customer needs and pain points, increasing customer satisfaction.

3) Collaboration:

Collaborate with fintech partners, tech startups, and other stakeholders to leverage external expertise and stay on the cutting edge of innovation.

Conclusion 

The banking industry’s path to success is through innovative practices that transcend buzzwords. By adopting Digital Corporate Banking Solutions and embracing Digital Banking Transformation, financial institutions can become true differentiators in the market. Challenges will persist, but a commitment to innovation, a customer-centric approach, and a proactive mindset can lead to lasting success.

About Maveric Systems

Starting in 2000, Maveric Systems is a niche, domain-led Banking Tech specialist partnering with global banks to solve business challenges through emerging technology. 3000+ tech experts use proven frameworks to empower our customers to navigate a rapidly changing environment, enabling sharper definitions of their goals and measures to achieve them.

Across retail, corporate, and wealth management, Maveric accelerates digital transformation through native banking domain expertise, a customer-intimacy-led delivery model, and a vibrant leadership supported by a culture of ownership.

With centers of excellence for Data, Digital, Core Banking, and Quality Engineering, Maveric teams work in 15 countries with regional delivery capabilities in Bangalore, Chennai, Dubai, London, Poland, Riyadh, and Singapore.

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Digital Corporate Banking Solutions are helping Customer Service Excellence in Corporate Banks.

Digital Corporate Banking Solutions are helping Customer Service Excellence in Corporate Banks.

The financial industry is experiencing a profound transformation, and at the forefront of this change is the digital revolution. With the rise of digital corporate banking solutions, corporate banks are streamlining their operations and revolutionizing how they serve their customers. In this blog, we’ll explore how these solutions reshape corporate banking and their impact on customer service excellence and provide recent examples of innovation in this space.

The Digital Wave of Corporate Banking Transformation

Digital corporate banking solutions have ushered in a new era of convenience and efficiency. These solutions include many technologies and specific solutions for corporate clients. The keywords in focus – digital corporate banking solutions and corporate banking digital transformation – signify the core of this revolution.

Streamlined Corporate Banking Products and Services

Digital corporate banking solutions have enabled banks to enhance their product and service offerings. Gone are the days of tedious paperwork and manual processes. Today, corporate banking products and services are just a few clicks away. For instance, electronic invoice financing platforms have simplified business working capital management, facilitating quicker access to funds for growth. Using AI-driven credit risk assessment tools also ensures faster loan approvals, benefiting both banks and their clients.

Personalized Customer Experiences

One of the keys to customer service excellence is personalization. Digital corporate banking solutions allow banks to gather valuable insights about their clients’ preferences and behavior. This information can be leveraged to tailor products and services to individual needs. A prime example is how some banks use data analytics to offer custom financial advice and recommendations. This builds stronger customer relationships and helps clients make more informed financial decisions.

Enhanced Accessibility and Convenience

Corporate clients no longer need to visit a physical branch or spend hours on the phone to perform banking transactions. With mobile apps, web portals, and chatbots, digital corporate banking solutions have made banking services accessible 24/7. This level of convenience is a game-changer in customer service, ensuring that corporate clients can access their accounts, initiate transactions, and seek support at their convenience.

Recent Examples of Innovative Digital Corporate Banking Solutions

To illustrate the impact of digital corporate banking solutions, let’s look at some notable innovations by financial institutions:

1. JP Morgan Chase

JP Morgan Chase has been a frontrunner in digital corporate banking solutions. Their “Chase for Business” platform offers tools and services to simplify various corporate banking aspects. These include online account management, expense tracking, and even the ability to accept payments online. Such innovations have empowered businesses, making financial management more straightforward.

2. Citibank

Citibank has made significant strides in providing mobile banking solutions for corporate clients. They introduced a mobile app specifically tailored for corporate users, allowing them to manage accounts, complete transactions, and access real-time financial data, all from the palm of their hand. This level of accessibility has been lauded for its contribution to customer service excellence.

3. Wells Fargo

Wells Fargo has adopted AI-driven technologies to enhance customer service. They utilize chatbots and virtual assistants to answer routine customer queries, thus freeing up human agents to handle more complex issues. This automation ensures quicker responses and resolution of issues, contributing to an improved customer experience.

Challenges and Approaches to Success

While digital corporate banking solutions are undoubtedly a boon, there are challenges that banks must overcome to achieve true customer service excellence. Key challenges include data security and privacy concerns, regulatory compliance, and ensuring a seamless omnichannel experience.

To address these challenges, FIs must invest in solid cybersecurity measures to protect sensitive customer data. Additionally, staying updated with changing regulations and adhering to compliance standards is imperative. Moreover, offering a consistent experience across various digital channels and maintaining the human touch in customer interactions will be crucial.

Conclusion

Digital corporate banking solutions have revolutionized corporate banking by streamlining products and services, enabling personalized experiences, and enhancing accessibility. Notable examples from institutions like JP Morgan Chase, Citibank, and Wells Fargo underscore the impact of innovation in this space. However, the road to customer service excellence has its challenges. Still, with a commitment to data security, compliance, and a seamless omnichannel experience, banks can successfully navigate this digital transformation and continue elevating customer service excellence.

About Maveric Systems

Starting in 2000, Maveric Systems is a niche, domain-led Banking Tech specialist partnering with global banks to solve business challenges through emerging technology. 3000+ tech experts use proven frameworks to empower our customers to navigate a rapidly changing environment, enabling sharper definitions of their goals and measures to achieve them.

Across retail, corporate, and wealth management, Maveric accelerates digital transformation through native banking domain expertise, a customer-intimacy-led delivery model, and a vibrant leadership supported by a culture of ownership.

With centers of excellence for Data, Digital, Core Banking, and Quality Engineering, Maveric teams work in 15 countries with regional delivery capabilities in Bangalore, Chennai, Dubai, London, Poland, Riyadh, and Singapore.

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The future of Banking Transformation is Composable Banking.

The future of Banking Transformation is Composable Banking.

This piece explores the cutting-edge concept reshaping the future of banking transformation: Composable Banking. The innovative approach is poised to revolutionize the financial industry by offering a dynamic and agile framework that distinguishes itself from traditional models and opens doors to unparalleled opportunities for banks and financial institutions.

Banking Transformation Services 

Partnering with seasoned BankTech companies like Maveric that challenge the status quo through fresh thinking and deep domain contextualization is a powerful way to feed the innovation pipeline for leading BFSI players.

Defining Composable Banking

Composable Banking is a technology and transformation strategy that responds to the ever-evolving nature of the financial landscape. At its core, Composable Banking revolves around modularity and flexibility, allowing banks and financial institutions to create and orchestrate their services by assembling various independent components. This approach is based on the MACH principles: Microservices, API First, Cloud Native, and Headless. By embracing these principles, Composable Banking enables institutions to innovate swiftly, adapt to changing market conditions, and maintain a competitive edge in the industry.

Evolution Beyond Traditional Models in Corporate Banking Transformations

What sets Composable Banking apart from traditional models is its ability to transcend the limitations of monolithic architectures and rigid systems. In the past, banking transformation often entailed extensive overhauls of legacy systems, which were time-consuming, expensive, and prone to disruption. Composable Banking, on the other hand, takes a modular and interconnected approach, allowing banks to quickly swap, replace, or add components to their existing infrastructure. This flexibility empowers banks to swiftly respond to customer demands, market trends, and regulatory changes while minimizing disruption and maximizing control over their product roadmap.

Real-World Examples of Composable Banking Success

Several forward-thinking banks have already embraced Composable Banking with remarkable success. Notable among them is Monzo, a UK-based neo-bank that has harnessed the power of Microservices and API First principles to develop over 2000 microservices that power their banking experiences. Monzo’s modular architecture has enabled them to scale, secure, and manage their services rapidly, demonstrating the potential of Composable Banking to revolutionize the industry.

Citibank is another prime example of API-First implementation, utilizing the principle to expose all functionality through APIs and viewing APIs as discrete products rather than mere integrations. This approach fosters flexibility, interoperability, and reusability, key characteristics that underpin Composable Banking’s success.

Strategic Considerations while Deciding Composable Banking Transformations.

Before embarking on the journey toward Composable Banking, banking leaders must carefully consider several strategic aspects:

Modularity Assessment:

Evaluate existing systems to identify opportunities for modularization and determine the components that can be effectively decoupled and reassembled.

API Strategy: 

Develop a robust API strategy that aligns with the bank’s business objectives and customer needs, ensuring seamless integration and interoperability.

Cloud-Native Adoption:

Embrace cloud-native technologies to leverage the scalability, flexibility, and cost-efficiency required for Composable Banking’s success.

Ecosystem Partnerships:

Build a network of ecosystem partners and specialist vendors to leverage the power of a multi-partner ecosystem for enhanced innovation and user experience.

Change Management:

Implement a comprehensive change management strategy to facilitate a smooth transition to Composable Banking involving employees, customers, and stakeholders.

Shaping the Future with Three Crucial Questions for Digital Corporate Banking Solutions.

As Composable Banking shapes the future of banking transformation, three crucial questions will determine its trajectory:

  1. How effectively can banking leaders balance modular flexibility and maintaining control over the product roadmap?
  2. What measures will banks take to ensure the security, compliance, and seamless integration of the diverse components in a Composable Banking architecture?
  3. To what extent can Composable Banking foster innovation, accelerate time-to-market for new products, and create unique customer experiences?

Conclusion 

Composable Banking heralds a new era of banking transformation characterized by agility, innovation, and customer-centricity. By embracing the principles of Microservices, API First, Cloud Native, and Headless, banks can position themselves at the forefront of industry disruption. As they navigate the strategic considerations and address pivotal questions, banking leaders can redefine their institutions and shape the future of finance.

About Maveric

Starting in 2000, Maveric Systems is a niche, domain-led Banking Tech specialist partnering with global banks to solve business challenges through emerging technology. 3000+ tech experts use proven frameworks to empower our customers to navigate a rapidly changing environment, enabling sharper definitions of their goals and measures to achieve them.

Across retail, corporate & wealth management, Maveric accelerates digital transformation through native banking domain expertise, a customer-intimacy-led delivery model, and a vibrant leadership supported by a culture of ownership.

With centers of excellence for Data, Digital, Core Banking, and Quality Engineering, Maveric teams work in 15 countries with regional delivery capabilities in Bangalore, Chennai, Dubai, London, Poland, Riyadh, and Singapore.

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The top five principles for sustainable growth in Corporate banking

The top five principles for sustainable growth in Corporate banking

The C-Suite leaders of commercial banks are busy steering their institutions toward sustainable growth in the dynamic landscape of corporate banking. The evolution of the corporate banking sector is being shaped by various forces, including technological advancements, regulatory changes, and the growing emphasis on environmental, social, and governance (ESG) factors. In this article, let us outline the top five principles that underpin the strategy for sustainable growth in corporate banking transformations.

Digital Corporate Banking Solutions.

Partnering with niche BankTech companies like maveric that bring deep domain contextual knowledge and a set of comprehensive competencies enables leading corporate banks to master the constantly changing and complex marketplace.

Principle 1: Embrace Sustainable Banking Principles in Corporate Banking Services

The first step towards sustainable growth in corporate banking is to embrace the core principles of sustainable banking. These principles revolve around environmental, social, and governance considerations. By aligning our banking activities with these principles, we ensure that our decisions positively impact sustainability and social well-being. For instance, integrating environmental and social risk management into our decision-making processes helps us identify and mitigate risks related to human health, biodiversity, and cultural heritage.

Principle 2: Environmental and Social Footprint in Corporate Banking Products

Corporate sustainability also involves assessing and minimizing our environmental and social footprint. We commit to avoiding, minimizing, or offsetting negative impacts on the environment and the communities where we operate. For example, we can reduce our carbon footprint and wasteful practices by implementing energy-efficient technologies and sustainable supply chain practices. By doing so, we contribute to a healthier planet and enhance our brand reputation.

Principle 3: Social Responsibility and Human Rights across  Corporate Banking Digital Transformations.

A key aspect of sustainable growth is upholding human rights and social responsibility. As a corporate bank, we pledge to respect human rights and ensure our business activities do not negatively influence them. This principle entails assessing the impact of our operations on human rights and taking corrective actions when necessary. By fostering an inclusive and diverse workplace, we contribute to a positive workplace culture and advance women’s economic empowerment.

Principle 4: Financial Inclusion and Collaborative Partnerships

Achieving sustainable growth requires extending our services to individuals previously excluded from banking services. Focusing on financial inclusion can provide affordable services to low-income community members and contribute to economic growth. Collaborative partnerships across the financial sector are essential for promoting sustainable investment and driving progress toward a sustainable economy. These partnerships allow us to pool resources and expertise to achieve common sustainability goals.

Principle 5: Transparent Reporting and Governance

Transparency and governance are vital pillars of sustainable growth in corporate banking. We commit to maintaining honest and transparent accounting practices while adhering to regulatory compliance mandates. This ensures that our stakeholders clearly understand our sustainability progress and that we are accountable for our actions. Strong environmental and social governance practices reinforce accountability and set a high standard for sustainable investment.

Navigating Regulatory Compliance in Digital Corporate Banking Solutions

While striving for sustainable growth, corporate banks must navigate various regulatory compliance mandates. These regulations often relate to ESG criteria and require us to disclose information about our environmental impact, social practices, and corporate governance. Staying abreast of these regulations and implementing robust reporting mechanisms will enhance transparency and reinforce our commitment to sustainable banking practices.

Strategic Considerations for Growth, Revenues, and Profitability

To achieve sustainable growth in corporate banking, we must focus on critical strategic considerations:

Customer-Centric Approach:

We enhance customer satisfaction and loyalty by understanding our corporate clients’ evolving needs and offering tailored solutions.

Innovative Technologies:

Embracing fintech innovations and digital platforms can streamline processes, improve efficiency, and enhance customer experiences.

Diversified Offerings:

Offering a wide range of banking products and services allows us to cater to various client needs, ensuring a stable revenue stream.

Risk Management:

Implementing rigorous risk assessment and management strategies helps safeguard our assets and maintain profitability.

Talent Development: 

Nurturing a skilled workforce with the latest industry knowledge ensures effective decision-making and sustained growth.

Questions for CTOs and CIOs while Considering Corporate Banking Transformations

  1. How can technology be harnessed to enhance sustainability and efficiency in our banking operations?
  2. What digital platforms and innovations can we integrate to provide a seamless, customer-centric experience?
  3. How do we ensure compliance with regulatory mandates related to ESG criteria and sustainability reporting?
  4. What strategies can we employ to effectively manage risks and adapt to changing market dynamics?
  5. How can we foster a continuous learning and innovation culture among our workforce to drive sustainable growth?

Conclusion

Sustainable banking principles provide a clear roadmap for achieving growth, profitability, and social responsibility in the corporate banking sector. By embracing these principles, navigating regulatory compliance, and focusing on strategic considerations, we can position ourselves as long-term winners in the evolving landscape of corporate banking.

About Maveric Systems

Starting in 2000, Maveric Systems is a niche, domain-led Banking Tech specialist partnering with global banks to solve business challenges through emerging technology. 3000+ tech experts use proven frameworks to empower our customers to navigate a rapidly changing environment, enabling sharper definitions of their goals and measures to achieve them.

Across retail, corporate & wealth management, Maveric accelerates digital transformation through native banking domain expertise, a customer-intimacy-led delivery model, and a vibrant leadership supported by a culture of ownership.

With centers of excellence for Data, Digital, Core Banking, and Quality Engineering, Maveric teams work in 15 countries with regional delivery capabilities in Bangalore, Chennai, Dubai, London, Poland, Riyadh, and Singapore.

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Building for the future: How legacy core banking companies are preparing for new-age digital assets.

Building for the future: How legacy core banking companies are preparing for new-age digital assets.

The last decade has seen the rise of many new-age digital assets, such as cryptocurrencies, security tokens, and non-fungible tokens (NFTs). These offer several advantages over traditional assets, such as increased transparency, faster settlement times, and lower transaction fees, and are also seen as a diversification option. The global Cryptocurrency market cap stands at over a Trillion and is expected to grow further in the coming years.

Some incumbent core banking companies have been around for decades, providing customer services worldwide. Many core banking systems have evolved, giving various functionalities and services, including wealth management, trade finance, etc. They must also adapt and embrace new-age digital assets to stay competitive and meet customer expectations.

This, however, requires multiple changes in the legacy software.

Changes required in legacy software:

Various changes are required to make legacy software compatible with new-age digital assets, depending on the specific features of those assets. However, some general considerations include the following:

  • Adding support for new standards: New digital assets, such as ERC-20 for Ethereum-based tokens, may require further measures. Legacy software may need to be updated to support these standards.
  • Updating protocols: Legacy software may use outdated communication protocols incompatible with new digital assets. Updating these protocols can help ensure compatibility.
  • Introducing new data structures: Digital assets often use new data structures that legacy software may not be able to handle. Introducing these data structures can help the software manage the recent acquisitions.
  • Enhancing security measures: New digital assets may require additional security measures not present in legacy software. Enhancing security measures can help ensure the safety and integrity of the assets.
  • Improving integration: Digital assets may need to integrate with other systems, such as wallets, exchanges, or blockchains. Improving integration can help ensure seamless communication between the software and these systems.
  • Updating user interfaces: Legacy software may not have user interfaces optimized for managing digital assets. Updating the user interface can help users manage the assets more efficiently.

Overall, updating legacy software to handle new digital assets requires a holistic approach that considers the specific needs and requirements of the assets, as well as the overall architecture and design of the legacy software. It may also require collaboration with third-party providers, such as wallet or exchange providers, to ensure seamless integration with other systems.

Challenges:

In addition to making essential software changes, traditional core banking products also encounter challenges in keeping up with new investment options and adapting their offerings for digital assets.

  • Regulatory uncertainty – Digital assets are still a relatively new and unregulated asset class, and there is a lack of clarity around how they should be treated from a regulatory standpoint. Strict regulations are expected to be enforced on these assets. To avoid legal or reputational risks, core banking companies must navigate this regulatory uncertainty carefully.
  • Another challenge is the lack of standardization and interoperability between digital asset platforms. Digital assets are issued and traded on various platforms with standards and protocols. This can make it difficult for legacy core banking companies to integrate these assets into their existing systems and workflows.
  • Providing ongoing support: Digital assets constantly evolve and may require constant updates and maintenance to ensure compatibility with legacy software. Providing ongoing support can help ensure that the software remains compatible with new digital assets as they emerge.

Remediation Strategies:

Below are some steps that legacy software firms should take to stay abreast of the latest trends and developments in the digital asset space. Many of these have been adopted by the leading core banking product companies.

  1. In addition to hiring experts in blockchain technology, smart contracts, and cryptocurrency markets, traditional product companies can team up and invest in fintech firms to tap into the specific knowledge, technology, and resources required for digital assets. A few examples seen in recent times:
    • Temenos has partnered with Taurus, a Swiss-based digital asset infrastructure provider, to enable banks to offer their clients digital asset products and services. The partnership integrates Taurus’ digital asset infrastructure with the Temenos Transact platform, allowing banks to manage digital assets alongside traditional banking products.
    • Infosys Finacle, part of EdgeVerve Systems Limited, and R3, one of the fastest-growing blockchain software companies in the world, have partnered to collaborate on blockchain solutions.
    • Avaloq invested in METACO, a provider of hardware wallets for digital assets, which also offers digital asset custody solutions.
  2. Legacy product companies should invest in technology infrastructure to support digital assets and develop solutions.
    • Oracle, apart from their banking solution FLEXCUBE, has created the Oracle Blockchain Platform, allowing the creation and management of blockchain networks.
    • TCS’s Quartz™ for Markets offers services around tokenized securities and its proven TCS BaNCS.
    • Infosys Finacle, a leading core banking software provider, has developed blockchain-based solutions Trade Connect for trade finance and Payments Connect for real-time payments.
  3. Wealth management products should offer a seamless user experience for clients who want to manage their digital assets alongside traditional assets. This includes offering intuitive user interfaces, mobile apps, and other tools to help clients manage their portfolios.

Conclusion:

Despite the challenges, legacy core banking companies are well-positioned to play a vital role in the digital asset space. They have existing customer relationships and regulatory expertise that can be leveraged to offer digital asset services. By adapting and evolving, these companies can remain relevant in the new digital age and continue to provide value to their customers.

New-age digital assets will continue to play a vital role in the financial industry, and legacy core banking companies must adapt to this new digital landscape to remain competitive. Legacy core banking companies can embrace digital assets and provide unique and innovative customer services by forming partnerships with fintech startups, investing in cutting-edge technology, and developing solutions.

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