Prioritising technological change within financial services.
23 April 2021
By Faizan Haq, Senior Policy Adviser at the FLA
The Covid-19 pandemic and subsequent lockdowns have forced many organisations to prioritise technological change – whether to enable remote working or match changing customer expectations.
McKinsey recently reported that on average it took firms 21.9 days to digitise their services during the crisis. Prior to the pandemic, survey respondents anticipated that change of this kind would take 585 days to implement.
The stark differences between the ‘expected’ and ‘actual’ timescales raises questions for some organisations about why they did not evolve their business models prior to the crisis. Just over half of the survey respondents said it was not a top business priority.
Delegates at the FLA’s RegTech Conference 2021 reported that major hurdles to technological change included the ‘shock’ impact to established ways of working; legacy and complex IT infrastructures; and the lack of buy-in from senior management within the organisation on the benefits of change.
These hurdles are neither new nor insurmountable. The conference sessions showcased how firms can benefit from an approach that:
- Allows efficient and proactive testing / implementation of technological change outside of a crisis situation.
- Removes excessive technical jargon and uses simple language to set clear strategies everyone can understand.
- Puts customer preferences at the heart of the project - particularly around how customers want to access and use specific products and services.
- Reinforces the focus on building trust with customers and how firms will protect personal data and combat cyber security threats.
- Recognises the rapidly changing regulatory landscape, how new technology can be a real ally in ensuring compliance, and the emergence of new technologies – the development of Open Finance is one to look out for here.
As the pandemic slowly eases, firms have an opportunity to build on some of the technological strides taken over the last year by creating long-term implementation strategies.
To support firms with this, the FLA has established a new Technology & Innovation Working Group to focus on emerging trends within the technology and regulatory landscape.
A full summary of the FLA’s recent RegTech Conference can be found here.