Banking Technology Radar 2023
- An LTIMindtree Crystal Report
- An LTIMindtree Crystal Report
The world of banking is rapidly evolving and embracing new technologies. By adopting AI, analytics, blockchain, IoT, cloud, and quantum computing, banks can provide efficient and cost-effective services to their customers. Staying ahead of technological trends is critical for any financial organisation looking to remain competitive.
Banking Technology Radar 2023 - An LTIMindtree Crystal Report acts as a guide for the banking industry, providing a roadmap for future IT strategies. The report offers a comprehensive view of the latest transformative technologies shaping the banking landscape. It presents 63 trend elements across four segments, ranging from architecture, cloud, and data to digital. It is rated based on three parameters - adoption phase, horizon, and application scope.
The report comprises three horizons, each representing the length of time between the emergence of a new trend and its adoption by the mainstream market.
Banking-as-a-Service (BaaS) has arrived and is poised to lead the future of financial services by offering API-led, transparent, and customer-centric alternatives. BaaS provides banks with simplified compliance, speed, security, and cost efficiencies, but it’s worth noting that many banks still rely on legacy core and product platforms. Banks can deploy cloud-based digital solutions using microservices through platforms to bridge this gap and extend their products and components. As the financial industry evolves, BaaS and platform solutions will play a pivotal role in meeting customers’ needs and driving success.
Learn MoreEmbracing AI and digital innovation at scale is essential for banks to maintain their competitive edge. Through AI and machine learning, financial institutions can utilize predictive analytics, anomaly detection, and shared learning models to bolster system stability, identify fraud, and offer top-notch customer-centric experiences. The advantages of adopting these technologies are self-evident, making it a key consideration for banks that wish to stay ahead of the curve.
The digital lending landscape is in flux as customer demands evolve and disruptive technologies emerge, compelling banks to reassess their regulatory and compliance policies. Obtaining a loan was traditionally a complicated process, with extensive paperwork, slow approvals, and limited credit options presenting obstacles for customers. But with technology integrated into banking and financial services, loan applications can now be processed in minutes, dramatically streamlining the digitized lending process and paving the way for new trends in 2023 and beyond. Banks must embrace the future of lending to remain competitive!
Tokenization is crucial for securing sensitive data while preserving its utility, which is vital for a safe and secure digital future. It can significantly improve security measures, lower operational costs, and enhance the overall customer experience, providing businesses with a competitive advantage. A survey by the PCI Security Standards Council found that 60% of merchants and 44% of banks use tokenization to protect their customers’ payment card data. This highlights tokenization’s importance as a fundamental resource for businesses striving to maintain a secure and competitive position in the digital landscape.
Learn MoreBanking of Things simplifies account opening, management, and transactions by integrating devices with financial institutions. Despite being in its early stages, there is substantial interest and investment in this field. The technology offers customized services, biometric authentication, and real-time fraud detection, improving convenience, accessibility, and security. However, data privacy and security are still major concerns that must be addressed as Banking of Things advances.
The adoption of cloud technology is critical to providing advanced buying experiences that are essential for all businesses to succeed. Cloud migration opens opportunities for innovation within the payment ecosystem. However, cloud solution providers must continually address data security threats as a crucial aspect of their service offering.
Open banking APIs enable financial services and personal data integration across different devices through open-source software and network protocols. A crucial advantage of this technology is increased competition, which results in a broader range of financial products and services. The global adoption of open banking services is expected to double between 2022 and 2027.
Learn MoreCloud sustainability promotes environmental sustainability and minimizes the banking industry’s carbon footprint by using cloud computing technology. This can be achieved through energy-efficient hardware, renewable energy sources, and workload optimization. Cloud providers must adopt a transparent climate strategy and roadmap due to increasing pressure. Carbon emissions from hyperscale cloud services are a top criterion for choosing cloud services.
Knowledge graphs and high-performance computing (HPC) are facilitating the use of AI on large datasets, with unstructured data growing at an average annual rate of 23%. Graph Neural Networks (GNN) are advanced machine learning techniques deployed for real-time fraud detection. By analyzing interconnected entities such as customers, accounts, and transactions, GNNs can identify fraudulent activity in the banking and financial industry.
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