The COVID-19 pandemic revealed many things about the banking industry–some good, some not so good. As a global crisis proceeded to affect every bank around the world, overall, banks did one thing really well—they adapted their client-facing operations to meet increasing customer service demands. Customers may have noticed more frequent email communications to relay things like hours of operation or appointment-setting procedures. Or, customers may have quickly switched to using mobile and online banking applications to complete transactions. Whatever the need, banks sprang into action to ensure their customers could continue banking as they heeded the public health guidance to keep everyone safe.
But due to the overwhelming demand this change in operations placed on their core infrastructures, banks were quickly reminded that digitization is a two-pronged approach, consisting of both client-facing and back-end operations. Although it was imperative that banks gained the trust of their customer base in this new digital environment, legacy systems reached the breaking point that FinTech companies had warned about for years. Systems that were never designed to be used in real-time were being called upon in real-time to keep up with customer demands. Mainframes literally couldn’t handle so much processing. So, it became abundantly clear—the opportunity for banks to embrace emerging FinTech solutions is now.
Top IT Challenges Banks Face
Banks who had already begun peeling back the layers of their legacy banking systems before COVID had an advantage over their competitors who had yet to strategize a digitization plan. While they were able to keep moving forward with their build-outs, others were left to start from the top of the planning process.
Typically, when the planning process begins, a few key IT challenges emerge. Here are some key statistics recently cited by S&P Global Market Intelligence in their “Tech in Banking – The Race to Digital Adoption” webcast.
- Conflicting priorities
80% of banks surveyed indicated that IT staff spends the majority of their time carrying out day-to-day IT tasks
- IT Complexity
36% of banks say that complex systems are a top challenge facing their organization
- New Technologies
Only 5% of those surveyed would consider their technological framework to be cutting-edge
- Budget Constraints
57% agreed that a lack of budget is a concern for innovation
- Lack of Talent
40% of banks indicated that no one on their board of directors had technology experience in their careers
Identity Access Management: An Emerging FinTech Solution
Many of the concerns facing IT departments are rightfully overwhelming. As an innovative FinTech company, we understand all of these issues, but have made two of them a top priority in developing Provision IAM—time and money. Implementing a new IAM system doesn’t have to require increased staff bandwidth. Nor does a solution this innovative have to be out of the budget. With the lowest subscription cost of any identity management solution on the market, Provision empowers community banks with the same cybersecurity and management technology as large enterprise institutions.
Getting Started: Planning a Digital Transformation Strategy
Asking a few key questions is a great way to start the digitization planning process.
• What capabilities will your bank need in the coming years to remain competitive and serve customers well?
• What systems do you currently have and what systems will you need in order to meet those capabilities? Conducting a thorough inventory is a great place to start.
From there, do some research. What is the best solution for overhauling your legacy systems? For some, it may be a cloud-based solution or a complete rebuild. For others, partnering with a third-party vendor may be the best option. If you’ve been considering an IAM solution, we’ve created a thorough checklist of things to consider before implementation. This should give you a clearer idea of what, if any, issues need to be resolved prior to a seamless overhaul.