Top 3 Emerging Technologies for Banks in 2021

The year 2020 has introduced and accelerated new concepts of remote work, social distancing and regulatory restrictions, with both banks and their clients enduring the consequences of these measures to this day. Inevitably, serving customers without the need for physical presence at branches became a crucial requirement for banks from both a customer requirement and regulatory compliance perspective.

A main keyword in the past year has been “digital transformation”, a strategy that has been rapidly accelerated into execution as a result of the urgent need to move to fully digital platforms that allow banks to continue offering their services remotely. But what are the emerging technologies shaping digital transformation, and will continue to do so in the year 2021 and beyond?

Here are the top 3 technologies recommended for banks to consider and start implementing as early as 2021.

1. Cloud Computing

The first emerging technology on banks’ radars is Cloud Computing. Physical access limitations induced by the global pandemic lockdowns were not only limited to banks’ customers, but their human resources including information technology experts and admins required to operate and maintain banks’ data centers. These limitations have resulted in the blackouts of many data centers, whether partially or fully, since the beginning of the pandemic.

To overcome these limitations, banks need to seriously consider moving their crucial customer-related services to a cloud computing platform. With that, regulators too need to set up the regulatory frameworks to accelerate this movement.

In our past blog, It's a Digital Matter of Fact!, our infographic shows that over 50% of banking services are being provided in a one or more digital form that are direct candidates to be transformed into cloud computing-based platforms.

2. Application Programming Interfaces (APIs)

In another blog by ProgressSoft’s Lead Architect, How Open APIs Revolutionize Banking Services, Ali Qoul discusses the crucial need to adopt a set of open APIs that simplify integration with third-party systems and solutions in order to accelerate introducing banking and financial services to a wider customer base. By switching to cloud computing platforms, providing APIs that cover different endpoints not only accelerates time-to-market, but opens new doors to introduce new innovative solutions that attract remote clients and retain existing ones.

3. Artificial Intelligence and Machine Learning (AI/ML)

With remotely managed customers comes the need to properly identify new customers when they show their intent to enroll into one or more of banks’ proposed services through diligent Know Your Customer (KYC) procedures. Utilizing AI/ML-based solutions not only serves initial registration as seen in ProgressSoft’s newly launched Electronic Know Your Customer but also serves value-added purposes such as Automatic Signature Verification.

During a remote enrollment and onboarding session, deep machine learning technologies can be utilized to fully identify an anonymous person through face recognition, liveness detection and document authenticity validation. In addition, responding to customer calls usually requires a dedicated call center that operates around the clock. Accordingly, smart AI-based chatbots are now must-haves to enable a fully digital banking platform that can not only respond to customer calls, but dispatch issues to designated officers and third-party vendors responsible for analyzing and providing resolutions as soon as a ticket is captured.

Let us not forget the marvelous role AI also plays in crucial domains such as systems’ health monitoring, log and anomaly analysis, and real-time forgery and fraud detection.