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Why unified observability is a gamechanger for the developments of banks

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by John Atkinson, Director of Sales Engineering, UK & Ireland, at Riverbed

 

Traditional banks are lagging behind digital banks in digital offerings and services, is unified observability the gamechanger traditional banks need in order to catch-up?

In this digital age, competition in banking is becoming more and more fierce – banks that were unified are now fractured by ‘which type of bank’ they are, traditional or digital. Traditional banks are established, renowned and have decades, if not centuries, of history in banking. Much like how the Bank of England was founded in 1694. On the other hand, new-age digital banks are digitally native companies, like Revolut and Monzo, that have almost completely adapted to today’s technologically advanced market.

Yes, traditional banks are established, tried-and-true. However, in this digital age they face their toughest challenge to date – adapting to technology. Digitally native companies, like digital banking apps, platforms and FinTech companies have almost completely adapted to today’s market – with consumer demand fuelling the motivation for more tools and services to be offered with a complete digital experience.

Unified observability, for traditional banks, might be the gamechanger here. It’s a tool that saves companies the process of reviewing events, metrics, and data. Along with complete IT infrastructure monitoring, unified observability enables IT teams to glean actionable insights from their data, ensuring a quality digital experience for end-users which ultimately  keeps employees happy and productive.

John Atkinson

For example, Monzo has an in-app monthly spending budget tool as well as a guide on how to use it. When it comes to providing services, even the small and relatively new digital banking platforms are continuing to outperform their high-street counterparts. While also offering better mobile and online banking services.

Although traditional banks are transitioning more of their services to a digital landscape, they still fall short of competing with digitally native businesses. These companies, who aren’t under the constraints of legacy systems, are attracting customers over traditional banks largely in part due to their innate flexibility, instant and ease of access to money, and well-made budgeting and money-saving tools.  It’s no wonder that The Guardian reported that 23 million more people in the UK abandoned coins, moving closer to a cashless society.

A significant reason for the disparity between traditional and digital banks comes from the fact that traditional banks are internally complex and difficult to restructure. Internal innovation at a reasonable pace is difficult for larger, more established institutions and usually have very integrated, very complex systems in place. For these institutions to position themselves properly, they require high-performance capabilities across many geographic locations to deliver a seamless, end-to-end digital experience for customers.

To pursue this goal, banks need to have unified observability across data transactions, networks, applications, and end-users so they can draw upon and provide actionable insights for their business. Unified observability will also aid understaffed and overworked IT teams, enabling a holistic view over their entire ecosystem, who can now resolve issues seamlessly. This translates into directly providing customers seamless digital experiences as well as flexible, streamlined services.

Digitally savvy service offerings

Currently, customers are unable to complete certain actions remotely. This could be depositing money or cheques remotely or digital signing for loans. It’s clear that traditional banks must transition services to be remote in order to meet current, customer demands.

As reported by Deloitte; “younger consumers demonstrated a preference between physical and digital channels, especially services and offerings from digital-only banks and large technology companies”.  This is reflected by customer demand for more functions and services to be fully operational over smart devices and laptops, something digitally native businesses do exceptionally well.

As customers demand for more personalised experiences grow, it’s through establishing strong partnerships that traditional banks can deliver superior customer experiences which will help drive brand loyalty and trust. Using the issue of being unable to sign loans digitally, by partnering with DocuSign, for example, banks can enable digital signatures through their mobile apps.

As a result, banks will have a wealth of data and information about end-users which can create helpful services.  For instance, banks could look at replacing factual notifications about transactions with updates to customers about their current balances, forecasting on their spending, overspending and money saving recommendations.

A simplified and unified infrastructure

As banks evolve, adding more to their networks and systems will add the risk of falling into the trap of overly implementing features and technology into their infrastructure. This state of overload will cause technological complexity which may lead to a myriad of network and application performance issues – potentially causing new services to struggle unjustly.

Unified observability is what enables IT teams to grasp the conditions of their entire infrastructure. IT teams utilising unified observability can easily see how users have moved throughout their system, identifying opportunities for maximum improvement and service satisfaction. The technology also minimises costs. It does this as it streamlines the troubleshooting process by reducing the mean time to identify a problem, establish its location, resolve the anomaly, and finally verify the solution.

Paving the way for traditional banks to flourish

Digitally native banks may have the head-start in terms of digital transformation and redefining digital customer experience over recent years. This, however, doesn’t mean that traditional banks will always be left behind.

For traditional banks, saving time and money by automating and streamlining processes through unified observability is a win-win.  As a result, it’s time for traditional banking institutions to find the right partner, such as Riverbed, who can provide that tech-based oversight, embrace digital transformation throught it’s comprehensive unified observability portfolio. This in turn will not only help traditional banks become more cost-effective and efficient but will also provide them with a competitive edge.

Banking

The Importance of Digital Trust in Banking and Finance

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By Maeson Maherry, COO at Ascertia

 

With the rising adoption of eSignatures and the acceleration of digital transformation, trust in digital systems is more important than ever before. As a recession looms, the ability to trust digital systems is critical to the stability and security of the banking and finance industry.

So, what should businesses prioritise in an increasingly online world? Information security, data integrity, and digital trust are crucial for ensuring regulatory compliance and customer satisfaction.

Digital trust is empowering banking and finance institutions to effectively tackle issues of identity theft and fraud.

What is digital trust?

On the surface, digital trust refers to a digital system or platform that is secure and can be relied upon to protect and properly handle sensitive information.

Building the confidence that people have in digital systems, platforms, and technologies to handle their sensitive information, protect them from fraud, and function as intended is paramount for decision-makers going forward.

Trust online encompasses various aspects, such as data security, privacy, authenticity and reliability. Digital trust also involves assessing the trustworthiness of digital entities such as websites, apps, and online services, as well as the trust in the integrity and reliability of digital communications and transactions.

Maeson Maherry

Digital trust is a key element of digital transformation, the additional step to ensuring the digital systems in place are secure. This can include the following:

  • Online banking platform for customers
  • Digital document approvals and workflows
  • Secure digital signature solutions
  • Know your customer (KYC) checks
  • Electronic anti-money laundering procedures

Why is digital trust important for banks?

One of the main reasons why digital trust is so important in banking and finance is that it helps to tackle issues of identity theft and fraud. Customers and regulators require reassurance that personal and financial data won’t fall into the wrong hands. This includes customer statements, investment authorisations, legal records and customer personal data.

Online banking is now well established but the technology continues to evolve and so do the potential threats to data security. With phishing and other identity theft a daily concern, establishing digital trust in the industry is key.

Digital trust provides a means to trust in the identity of a person or document online, to the same degree as meeting or signing in person. This requires additional checks and layers of security to verify identities and the security of documents.

The role of eSignatures in banking

Digital trust is vital in the secure implementation of eSignatures.

In the banking and finance industry, eSignatures are becoming increasingly popular as they allow for transactions to be conducted quickly and securely. However, for eSignatures to be effective and to provide digital trust, all parties involved must trust in the transaction. This is done by ensuring eSignatures are valid and that the person signing the document is who they claim to be.

There are global standards to ensure the authenticity of eSignatures for digital signing. This means there is a way to validate the digital trustworthiness of eSignatures if implemented and used in a manner that meets certain criteria for security and authenticity.

For instance, digital signatures that are compliant with internationally recognised standards, such as eIDAS (Electronic Identification and Trust Services) in Europe, can be considered digitally trustworthy. It’s important to understand not all eSignatures provide the same level of security and to ensure the correct eSignature is used for the purpose and security required.

eSignatures that use advanced digital signature technologies such as Public Key Infrastructure (PKI) or biometrics, can be considered more digitally trustworthy as they provide a higher level of security and authentication.

These technologies use cryptographic methods to ensure that the signature is unique to the signer and cannot be replicated or forged. These standards establish a legal framework for the use of electronic signatures and ensure that they are legally binding, enforceable and offer the same level of trust as traditional signatures.

How does digital trust prevent fraud?

If the public loses trust in digital systems, it could lead to a loss of confidence in the financial system. Fraud, in particular, is at the forefront of public concerns.

Digital signatures are well positioned to offset the risk of financial fraud, largely due to three critical factors when assessing the digital trust of an eSignature:

  • Authentication: To verify the identity of the signer, eSignatures employ sophisticated technologies such as PKI. This confirms that the person signing the document is who they say they are and aids in preventing fraud through impersonation.
  • Tamper-evident: Tamper-evident features are often included in high-trust eSignatures, which identify if a document has been changed after it has been signed. This helps to prevent fraud by identifying manipulated papers and giving an audit trail of the signature.
  • Compliance: International standards such as eIDAS ensure that eSignatures are legally binding, enforceable, and provide the same level of trust as traditional signatures.

The banking industry specifically will benefit greatly from investing in digital trust ecosystems that include eSignatures, biometrics and encryption software to provide verification and assurance for customers.

In the future, financial institutions will adopt Know Your Transaction (KYT) as a means of implementing cybersecurity measures at the transaction level in their banking protocols.

By utilizing digital signatures at the transaction level and verifying them upon receipt, the financial industry can achieve KYT, ensuring that the source of information is under the control of the endpoint and that transaction information has not been tampered with.

This level of security will be a crucial aspect of achieving digital trust in the financial industry moving forward.

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Banking

How banks can help customers during the cost of living crisis

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 Lavanya Kaul Head of BFSI, UK & Ireland, LTI Mindtree

 

Surging energy and food prices are significantly driving up household expenditure, which means living standards in the UK will fall to 2.2% this year, according to the Office for Budget Responsibility. This is the biggest drop in any single financial year since the records began in 1956-57.

It’s a tough situation for many consumers who are still struggling with financial hardship following redundancies and pay freezes from the pandemic. According to TSB’s Money Confidence Barometer, 82% of people have experienced an increase in the day-to-day cost of living. This resulted in almost a quarter of them using their savings, while one in five changed their usual spending habits and behaviours.

As the financial situation worsens, consumers are increasingly relying on their banks for help and support. But, while banks can’t control inflation, energy or food prices, they can play a more supportive role by adapting their services to offer stronger customer service, better tools for financial management and be more flexible with loan repayments.

 

Strengthen customer service with intuitive AI solutions

Since the pandemic, consumers have changed the way they bank, using more mobile apps for primary banking rather than going into physical branches. This provided an opportunity for banks to accelerate their investment in digital services including automation and offer customers more support during the cost of living crisis.

Lavanya Kaul

Effective tools include AI-powered chatbots which respond intelligently to customer enquiries to quickly help troubleshoot problems and provide useful advice. But to be successful, you need to ensure you strike the right balance between an efficient and convenient process and creating a personalised experience. Customers need to feel like you understand and care about their problems and are here to help, rather than just fobbing them off with a monosyllabic bot. To avoid this, banks need to embrace intuitive AI solutions to ensure that empathy comes across in all automated interactions with customers. While doing that, messaging is key. In times of stress, we don’t function as well and financial struggles are a huge stressor. The clearer the message and the simpler the instructions, the better.

Financial education, when combined with technology solutions such as open banking, can offer more long-term solutions for people to navigate their finances. This can help put more information into the hands of the consumer to help them grasp their financial situation better. Some banks have cracked this with innovative solutions like HSBC’s Financial fitness score tool that can analyse your money habits and signpost you towards ways to improve your financial health. This may include joining one of the financial education webinars run by the bank or having a ‘financial health check’ with a member of staff.

 

Launch money management features & apps

Introducing money management features and apps to increase the visibility of a customer’s financial situation, empowers them with the information they need to make smarter choices.

TSB offers Spend & Save and Spend & Save Plus current accounts which include a savings pot that enables customers to put extra money aside when they can and an auto-balancer feature that automatically transfers money from the savings pot into their current account if their balance falls below a certain level. This allows them to start building up savings and protects them from unnecessary overdraft charges.

Personal financial management (PFM) apps also help customers get a better understanding of their finances. These connect with a customer’s bank account and enable them to keep a close eye on their spending habits and track upcoming bill payments. An example is Prism, a PFM app which allows customers to manage bill payments by sending them reminders about due dates. It also provides a summary of their income, account balance and monthly expenses at a glance, therefore consolidating all their financial information in one place and saving time on bill payments.

Lloyd’s Banking Group and HSBC launched a subscription management tool for all customers on mobile, allowing them to see and cancel recurring card payments for things like TV subscription services. HSBC says that during the first quarter of the year, it led to customers dumping around 200,000 subscriptions.

 

Introduce payment holidays

While improved customer service and financial management tools are important support tactics, they might not be enough for more vulnerable customers. For example, those who are about to default on mortgage payments or loans due to redundancy or periods of ill health need banks to do more, like offering payment holidays. Banks relaxed the rules for payment holidays during the pandemic, so they should consider doing it again to help more vulnerable customers through the crisis. Customers need to understand that they are not alone when experiencing financial difficulties and that help is available

 

Ride out the crisis together

As inflation reaches a 30-year high, customers are now more reliant than ever on banks for guidance and support. But to provide the right level of service, they need to move away from their traditional ways and behave more like technology companies by embracing automated solutions to create the right products and services for customers. Then layer on top of that the need for more personalised and empathetic customer interactions, as well as consider additional support for more vulnerable customers.

While we don’t know how long the cost of living crisis will last, what we do know is that the pressure on household finances is likely to get worse before it gets better. Therefore, banks need to step up, be the supportive partner and do whatever they can to help customers. After all, the only way we can ride out the crisis is by supporting each other and working together.

 

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