Financial Services TechnoVision, currently in its third year of publication, aims to offer businesses with a “robust” and “proven” foundation for technology adoption. It provides thought leadership to assist firms with navigating the “complex yet critical technology environment.”
As noted in the report, “agility” and “speed” are key drivers for the transformation of the financial services industry.
As mentioned in the report from Capgemini:
“Our theme for this year’s TechnoVision report is ‘Be Like Water’, which focuses on the fluid strategies and architectures of a modern Technology Business. To reach this status, financial institutions must use digital systems and services to transform into nimble, customer-focused, platform centric organizations.”
Financial Services TechnoVision 2021 lays down the elements of this type of organization. Through “a continuum of 37 building blocks extending from ‘systems’ to ‘people’, it brings to life the underlying fabric that supports the technology-business transformation of an organization. ”
The report, which has been published by Capgemini, states:
“Financial Institutions are at the forefront of embracing cloud-native architecture, either driven by competition from more agile competitors or from an innate wish to eliminate costs associated with legacy infrastructure. But a modern IT infrastructure goes further by inculcating a faster time to market, enabling hyper-personalized services and facilitating rapid scaling in-line with time-sensitive demand.”
But relatively few organizations have taken the step to completely replace their core or main infrastructure, with most undertaking “a progressive minimization of their dependency on legacy platform while they build a modern architecture around it,” the report added. It also mentioned that internal challenges “in terms of disparate data sources, lack of application rationalization, distrust on cloud security, and organizational culture may have slowed down the migration from legacy IT.”
While sharing key trends and updates, the report notes:
“Financial Institutions are migrating to cloud to accelerate their digital transformation journey. Cloud not only provides on-demand scalability and agility but is also necessary for competitive differentiation. At different stages of the digital journey, cloud provides the agility for testing new products & services, improves interoperability between assets, and engages a positive feedback loop for recalibration of the digital strategy, if needed. It also eliminates the risk associated with IT infrastructure, reassessing the risk as OpEx instead of CapEx.”
The extensive 44-page report notes that a study carried out by Capgemini Research Institute indicates that “overreliance on machine-led decisions without disclosure is the top ethical issue faced by executives in financial services.”
The report also mentions that with AI systems “transacting large number of financial instruments, assessing insurance claims, assigning credit scores, and optimizing investment, explainability, auditability, and ethicality of AI have become important.”
The report further noted that “while the use of data as an enabler is picking up significant speed, a less explored aspect is its direct revenue-generation potential.” The report also mentioned that “while consent management can prove to be a hard nut to crack, if perfected, it opens up multiple avenues for monetization of data.”
The report added:
“Realizing this, Capgemini and IDC jointly launched a Data interoperability enables coordinated services in health insurance. Interoperability is designed to maintain patient confidentiality, reduce healthcare costs, and focus on personalizing patient data. Health Gorilla has moved into health insurance, aided by the introduction of fast health interoperability resources (FHIR)-based APIs, for more seamless data sharing.”
You may view the complete report here.