FINANCIAL SERVICES INDUSTRY
Jayathilake Bandara
THE FINTECH REVOLUTION
How savvy technology is shaping the delivery of global economic services
Financial services in general
The backbone of any economy the world over.
The industry in this country
We have a mature financial services industry that’s on a par with developed countries in terms of adopting the latest technology.
Core strengths
A strong capital base and is well regulated.
Overcoming crises
The industry has managed to overcome multiple economic downturns following the Easter Sunday bombings in 2019, COVID-19 pandemic, and fuel and energy crises.
Latest trends
AI and machine learning have taken the industry to a different level through data analytics, process automation, digital banking and customer support.
Role in economic recovery
Assisting customers who were affected – especially in the SME sector – to get back on their feet.
Going forward…
The financial services industry will need to be flexible in terms of risk taking and managing loans that may turn out to be irrecoverable.
Weaknesses
Capital intensive businesses face low returns on equity (ROE) due to higher loan losses and impairment.
Overcoming obstacles
While the industry will need to be flexible in terms of helping the needy, legal issues should be resolved quickly to recover funds from wilful defaulters.
Way forward
Digitalisation and process improvements will bring in efficiencies.
Where this is being seen at present
Already, mobile banking has changed the way payments are being made.
Impact of the economic crisis on the industry
Increase in non-performing loans and an explosion in terms of the cost of funds due to high interest rates.
Impairments
Multiple moratoriums have encouraged wilful defaulters.
Forward strategy
Consolidation is needed to bring stability and strength, absorb economic shocks and maintain sustainable growth.
Focus areas for improvement among local corporate professionals
Good governance, more accountability, a better work ethic, continuous learning and adapting to change.
Role of digital marketing
Digital capabilities based on customer experiences have led to personalised, interconnected and seamless service delivery.
Consumer challenges to digital adoption
Many clients still prefer brick and mortar branch models due to a lack of trust in the system.
Adding value to the system
Building transparency will improve customer confidence.
Influence of global events
Global events can influence decision makers to invest in and connect with the organisation’s overall business strategy.
Scope of modern technology
Disruptive technology will change the way the financial services industry operates.
Leadership commitment
Digital transformation requires the leadership of a business to offer its total commitment.
While the industry will need to be flexible in terms of helping the needy, legal issues should be resolved quickly to recover funds from wilful defaulters
Improvements…
We see some organisations taking the lead in this area; but overall, investment by businesses needs to improve.
Importance of digital transformation
Not adapting could lead to losing market share or becoming irrelevant.
Tech potential
Technology has the potential to revolutionise the financial services industry and fintech businesses can disrupt the traditional banking system.
Evolving consumer behaviour
Purchasing behaviour is changing rapidly with social networking, peer reviews of products, online research and digital payments.
Qualities needed for a career in financial services
Honesty and integrity – there is no compromising on these qualities.
Vision for the industry
To build a more inclusive and efficient financial services industry through the use of technology.
Mantra for success
Accountability, time management and perseverance.
– Compiled by Dona Senara
