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THE TOP 10 UNIQUE CHALLENGES FACED BY THE FINANCIAL SECTOR

The financial sector currently is facing unique challenges as they adopt digital/tech tools to offer a better experience for all stakeholders. With these technologies, comes their own share of issues. In this blog, we talk about these challenges which are or needed to be addressed. Let’s get down to it, shall we?

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The Many Challenges Facing the Financial Services Industry include:

  • Cybercrime. Data breaches and theft is a major concern in all domains including the financial services sector. Each year the % of such breaches is on the rise. In order to combat these from occurring with regularity, companies need to be pro-active and stay ahead of these thieves by deploying the latest technologies to ensure that the client data remains secure.

  • Regulatory compliances. The constantly evolving regulatory environment poses an omnipresent issue for this sector. Automated reporting, automated audits, and process streamlining some benefits presented by RegTech applications.

  • Big data usage. The amount of data received from various sources can be overwhelming especially sorting, cleaning, using, and drawing analysis. Powerful data analytics technology needs to be deployed to enable the companies to benefit in the long run. Luckily, data analytics solutions are being launched with the power to change asset management, trading, risk management, and so on.

  • Artificial intelligence use. It is widely believed that AI will change almost all aspects of the financial service industry. Automated wealth management, client verification, and open banking all provide scope for AI companies. Leveraging the power of AI is being debated hotly throughout the industry.

  • Fintech disruption. The arrival of fintech companies has thrown the cat among the pigeons. From being rivals to traditional companies, they are now being viewed as partners for the future. Since they are here to stay, partnership for the survival of both is ideal. India is a leading centre of Fintech companies especially Mumbai and Bangalore.

  • Client loyalty. With a plethora of companies and offerings, retaining clients is a big challenge. Clients are savvy and don’t mind switching vendors to get better deals etc. Automation of services and personalised services are the key to client loyalty.

  • Employee loyalty. Companies are having a tough time recruiting and retaining talent. People are no longer loyal and don’t mind switching firms wherever they get a better deal in any respect. Companies need to be pro-active to retain employees, be it in improving work culture / environment, upskilling opportunities, work – life balance, appreciation, and rewards.

  • Client experience. Clients are looking for engagement, personalisation, options, and nurturing. Ensuring client experience is fantastic is a big issue among all industries, financial sector included. CRMs and cloud services are solutions on this front.

  • Blockchain integration. The value of this component is being realised in the industry. From clearing issues faced by investment banks to enabling clients to make safer payment transactions, the uses are many.

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