Financial services firms accelerating technology transformation to navigate the pandemic, finds Broadridge
More than half of financial services companies plan to accelerate implementation of their next generation technology strategies, according to a new global survey of 500 financial services C-Suite executives and their direct reports released today by Broadridge Financial Solutions, a global fintech leader.
“Financial services players have shown they can adapt and change during the pandemic. Going forward, they will continue to drive digitisation and mutualisation to improve client experience, resiliency, and cost,” says Tim Gokey, CEO of Broadridge. “Prior investments in digital, cloud, and mutualised technologies have enabled companies to be more resilient during the crisis, and executives are taking careful note as they plan for the future.”
Virtually all financial services companies expect the pandemic to affect their operating model and strategy toward next-generation technology. In the next six months, companies plan to focus on:
- Increasing cybersecurity and risk management (63 per cent)
- Enhancing multi-channel client communications (60 per cent)
- Improving customer engagement and experience (53 per cent)
- Making significant cost reductions (45 per cent)
Prior investments that were most beneficial in managing the pandemic were interactive digital technologies (72 per cent) – defined as digitising customer and employee experiences, workflows and operations along with cloud technologies (59 per cent).
As a result of the pandemic, many firms have reprioritised their investment strategies. Businesses may never return to the old “normal”, leaving firms little choice but to accelerate their digital transformation.
- 58 per cent plan to increase investment in interactive digital technologies
- 54 per cent plan to increase investment in artificial intelligence (AI)
- 49 per cent plan to improve their ability to quickly gather and analyse data moving forward
The pandemic has also changed the role of fintech service providers, with 70 per cent of respondents stating that fintech providers’ ability to offer innovative uses of next-generation technology is now more important as a result of the outbreak. Almost half of respondents agree that the pandemic increased the need to mutualise – in other words, share or outsource – processing functions to reduce costs and increase resiliency.
- Commercial and investment banks and broker-dealers agree most strongly (54 per cent and 49 per cent, respectively)
- Sell-side companies believe this more strongly than buy-side companies (49 per cent and 42 per cent, respectively)
- Hedge funds were least likely to agree (36 per cent)
Leveraging next-gen technologies is part of Broadridge’s investment in The ABCDs of Innovation - AI, blockchain, the Cloud and digital – helping clients understand and apply these technologies by simplifying the complex to help them be Ready for Next.
This Broadridge survey was conducted by ESI ThoughtLab to assess the adoption of next generation technologies. C-Suite executives and their direct reports from 500 financial institutions globally were surveyed, with fielding completed 1 June 2020. The survey was administered to executives from buy-side and sell-side firms, including universal banks (20 per cent), commercial or investment banks (16 per cent), broker-dealers (14 per cent), investment/asset managers (15 per cent), insurance companies (13 per cent), hedge funds (11 per cent) and wealth managers (11 per cent). Responses were split evenly among the APAC, EMEA and North American regions.