Guest blog by Hassan Naveed, Business Integrations, Yobota

The Covid-19 pandemic has been a transformative experience for banks and financial services businesses.  Under fierce conditions, a window of opportunity was created for companies to expand their digital services and invest in new technologies.

Ingrained cultural attitudes are likely to sit behind these fears, with 53% of business leaders worried that an inflexible approach to technology adoption in their organisation means they are not well placed to adjust quickly to changing customer demands.

Overall, though, the overwhelming success of innovation projects throughout the past 18 months has inspired long-term optimism within the industry: the majority (73%) said they are confident they can withstand future disruptions due to the technological progress they’ve made during the pandemic.

What do the next 12 months have in store?

Yobota’s research also considered the mid- and long-term developments that have been intensified by the pandemic, and which are likely to reshape the financial sector.

Promisingly, the data provides a compelling narrative of the crisis forcing sustainable digital transformation, with the vast majority (65%) of businesses planning to ramp up digital spending over the coming 12 months, and two-thirds (67%) seeking to diversify the tech they use.

Improving the quality of their core technology systems is a priority for 74% of firms, with recent market changes having established a clear need to modernise business-critical infrastructure. As we have already seen, this is primarily driven by moving from legacy systems to cloud-based solutions.

Areas of focus also include investing in better data analytics to support enhanced decision-making (73%), and the deployment of application programming interfaces (APIs) (67%) that accelerate the introduction of new products and services.

There is a broad acceptance that digital-first services are becoming the primary mode of engagement, with businesses now under mounting pressure to ensure their online channels are future-proof. Evidently, business leaders are looking to technology as they build intuitive, personalised and frictionless user experiences that can adapt to evolving preferences.

Ultimately, then, the customer remains at the heart of future IT projects, with three in four (75%) firms intending to improve digital experiences by upgrading their website or mobile application. Meanwhile, 63% plan to automate customer interactions through chatbots and robo-advisors.

The drive for new technology means that three in five (59%) banks and financial services companies intend to pursue a partnership with a technology provider in the coming years to achieve their digital transformation goals.

While Covid-inspired digital transformations have paid off handsomely for many, the work is far from over. Looking ahead, banks and financial services companies must continue to extend and scale digital technologies to cater to ever-changing market demands, while leveraging the support of experienced technology partners where needed as they build for the future.

Hassan is dedicated to helping established and challenger banking businesses use next-gen technologies to deliver exactly what their customers need. Founded in 2016, Yobota is a London-based technology company with a fast, flexible, cloud-native core banking platform, which allows clients to create and run innovative financial products in record time.

The views, opinions and positions expressed within guest blogs are those of the authors and do not necessarily represent those of the BSA.