Financial Services Trends in 2021: Part 1

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Life is a dynamic phenomenon! This is how Hermann Hesse described our ever-changing existence in his play, The Glass Bead Game. We’re constantly driven to create innovative ideas to meet our most difficult challenges, and the financial services (FS) industry is no exception. Let’s review some of the biggest changes impacting global finance in 2021 and how SoftServe is succeeding in this “chase for its place under the sun.”

New technologies are transforming customer expectations

Customer behavior is dramatically changing, bringing new challenges and opportunities to the financial services industry. In 2021, customers desire simple and effective services and products built to serve their needs. Picture this: in an era where UI and UX toolkits are used to design seamless websites and mobile apps, it would be very disappointing for a customer to go to their bank’s website and see that it has remained unchanged for the last twenty years.

Upon encountering such a dated interface, a customer might think, “I can't find what I'm looking for. I don't understand what I see or why it’s relevant.” As a result, that customer might start looking for a bank offering more modern and efficient digital services.

Never have consumers relied so heavily on technology to communicate, perform everyday tasks, and interact with businesses. The COVID-19 pandemic significantly accelerated the introduction of disruptive new technologies, and customers increasingly expect the ease and simplicity offered by these new technologies in all areas of their day-to-day lives, including banking. That’s why fintechs and other FS newcomers that offer customers a remarkably simple experience are increasingly gaining market share.

Meeting the needs of digital-first customers

The financial services market is no longer driven by institutions, but by customers, who expect to find information and products where they need them. This is what customer behavior change is all about. Rapidly changing customer behavior is a challenging and complicated issue all financial institutions face, but this challenge presents a massive opportunity for business leaders who make strategic investments to digitalize their business.

Digitalization has been underway for decades, but the advent of COVID-19 has accelerated it. Instead of relying on manual processes, new applications have been built to recognize structured and unstructured data automatically, saving time and money. For example, AI systems have transformed daily work, in some cases automating tasks that would have required hundreds of staff. Regardless of industry, companies are now challenged to undergo massive internal changes and digitally transform to remain competitive.

How are companies pursing a path to becoming a modern, digital-first business? What business value does digitalization offer? To find out, let's look at how technology has impacted a handful of key sectors in 2021 and beyond: insurance, wealth management, and investment services, and capital markets.

Insurance

The insurance industry was disrupted by a shift to remote work and virtual customer engagement following the outbreak of COVID-19. In many European countries, insurance companies sold their products face-to-face, but COVID-19 effectively halted in-person transactions for a period of time. How can you sell insurance if there are no customers visiting your office to buy it? To solve this problem, you need intelligent digital systems. Across the insurance sector, we’ve seen a rise in the following trends:

  • Increase in non-personal communication
  • Rapid rise of online direct online sales
  • Growing use of artificial intelligence, alternative data sources, and other advanced technologies
  • Utilization of predictive analytics for claims, underwriting, and more

At SoftServe, we've adapted and innovated to serve this new, digital-driven era of client engagement. Customers now expect all of their applications to have robust self-service features. Intelligent chatbots are increasingly used to meet this expectation and present a reliable, cost-effective way to boost consumer engagement.

We offer chatbots and other tailor-made solutions to help insurance companies stay ahead of the competition. Insurance clients value our chatbot solutions for their ability to enhance customer loyalty and build brand engagement while lowering operational costs and increasing revenue.

Intelligent chatbots provide customers the advantage of being always-on and available across devices. However, it’s important to note that customers still desire human interaction when they want it. Chatbots are most effective when combined with the services of in-person staff, offering customers either experience based on what they prefer. When personalized to the needs of each end customer, chatbots are the right choice to help businesses increase engagement and build brand loyalty.

Insurance isn’t the only financial services sector that’s adapting to our new, digital-first world. Want to learn more about new technologies that are disrupting investment management, investment services, and capital markets?

Read the next blog post in our series on emerging trends in the financial services industry in 2021.

Ready to discover how innovative new technologies can transform your business? LET’S TALK about how SoftServe helps financial services companies stay ahead of the competition.