The future of banking is digital, and the Australian financial services industry needs to brace itself for a transformative year ahead.
“A digital transformation is inevitable in the Australian marketplace,” says Myles Bertrand, Managing Director APAC for Mambu, “however many of our established institutions are in dire need of a cultural overhaul before they can really embrace this brand-new world. Banks need to start thinking and operating like fintechs in order to maintain their position at the forefront of the Australian financial services industry.”
Mambu – launched in Germany but operating globally, including in Australia – works with banks, fintechs and telcos to help create a technology-first approach to banking, opening up new opportunities to optimise operations, ensure regulatory compliance and increase customer acquisitions.
In Australia in particular, it is the impact on regulatory compliance that is a key area of interest when it comes to the new era of digital banking.
“The good news is that digital banking is actually going to make it easier for financial institutions to comply with all of the different regulations,” says Bertrand. “It’s going to make it easier to track transactions, keep data safe and will also reduce duplication. So those organisations that make the transition from less secure legacy systems to cloud-based digital platforms, where security improvements are constantly made, can boast greater peace of mind and set themselves ahead of competitors.”
To stay in the game, banks need to be able to roll out products and services at a rapid pace, adding new features to platforms, while simultaneously enhancing existing ones. This kind of agility is next to impossible to achieve with most institutions’ legacy systems. However, composable banking architecture – the quick and flexible assembly of independent systems on a cloud platform – can provide the opportunity for organisations to create a dynamic platform with intuitive, responsive features that can be quickly and continuously updated.
A truly agile platform undergoes short, regular updates with a constant pipeline of improvements that are automatically layered on top of existing cloud technology and allows business to run uninterrupted on the front end. This allows financial institutions to make minor changes regularly, rather than major, infrequent updates that can cause significant disruption and draw the ire of customers, as has been the case with some traditional transformations.
With so many new players arriving in the marketplace looking to capitalise on the impending digital transformation of the industry, the key to successfully transitioning to digital banking is to look for proven, reliable fintech partners with experience and a successful track record in helping financial institutions make the switch. By working collaboratively with a proven digital engine, banks and financial institutions can build innovative integrations into new or existing product channels, creating simple, streamlined and automated customer experiences.
“I think the whole financial services industry – globally, not just in Australia or the APAC region – is going to be turned on its head over the next 12 to 24 months,” concludes Bertrand. “We really want to help banks take the leap and make the necessary changes to embrace the opportunities that digital banking can offer and set themselves up for success.
“As the looming fintech age forces institutions to digitise, innovate and scale to adapt to customer needs, those banks and financial institutions that can move at the pace of a technology company while remaining committed to strength, security and service will be the leaders of this new era.”
Myles Bertrand is the Managing Director, Asia-Pacific, for Mambu, the market leading cloud-based banking platform.