Financial institutions are at the heart of the global economy, however, customer expectations have been reshaped by the advancements of digital, mobile, cloud, data, and analytics technologies, which have caused customers to demand higher levels of service and value.
From embracing these newer consumer expectations to promoting open banking digital models, banks are now focusing more on customer experience. Modernizing core banking systems is key to achieving a true customer experience focus. Banking transactions have evolved beyond just simple transactions. Now, thanks to smart automation and cloud technologies, banks can handle massive information flows across multiple locations through bank integration.
What Is Banking Integration?
Banking integration encompasses a multitude of cross-border banking activities as well as cross-border flows of banking assets. As regulatory barriers have been lowered, and technology has advanced, the ability to integrate banks has increased. With the increase in corporate activity globally, international financial services are becoming more necessary and this advancement has decreased the cost of providing banking services across borders.
The use of technology in cross-border banking significantly enhances the capabilities of businesses. At the same time, corporations are growing at a phenomenal rate and the need for more complex international services is continuously growing. Despite multiple technological developments, the financial industry still has a long way to go before becoming truly global.
What Are Five Technologies That Assist Bank Integration?
Application Program Interface (APIs)
Most full-stack banks are integrated through APIs, which are well known for their speed, personalization capabilities, and agility. APIs are essential to making banks more integrated.
In order to increase efficiency, banking institutions need to integrate partner data and products quickly. Implementing APIs during partnership mergers can be particularly challenging. It involves long legal negotiations, pricing discussions, revenue sharing debates, and more. This can lead to delays in API implementation.
Banking operations have benefited tremendously from moving to the cloud. To support artificial intelligence and its adoption, cloud technologies are necessary. It is an ideal mechanism for harnessing, converting, and utilizing the vast amounts of data associated with artificial intelligence.
Since artificial intelligence deals with vast amounts of data, the cloud is the ideal platform for harnessing, processing, and utilizing information. Banking services should implement data analytics to enhance their performance of customer-based activities and internal organizational processes.
Blockchain technology entails the decentralization of financial management by moving it from a central point to a network of computers. Using blockchain technology will considerably reduce the operational costs for banks. Banks benefit from it by achieving their payment, remittance, and traceability goals. Having collaborative working practices within the bank’s network enhances data sharing procedures.
Artificial Intelligence (AI) includes a wide variety of technologies, including data science, the Internet of Things (IoT), and Natural Language Programming (NLP). The technologies outlined above all help a financial institution become more efficient. AI is a key component of bank customer service processes.
Customer Relationship Management (CRM)
CRM technology has been around for a while, and as a result, the banking industry has seen enhanced customer intimacy. CRMs increase cash flow, improve offerings, and provide superior customer service.
The Future Of Banking Integration
To align with international policies like foreign exchange and cash flow management, banks must critically evaluate existing banking structures and ensure they are evolving in line with growth in the banking industry. Having a solid base will ensure that new platforms are properly positioned for bank integration.