Ten technology trends to follow in 2021
Financial institutions are using RegTech to onboard customers fast and with compliance across all jurisdictions they operate in.
Artificial intelligence provides client insight directly to managers in real-time, without language limitations. Blockchain technology’s potential is fully understood at every level of the business, and plans are afoot to use it. Well, we may not be there quite yet, but we may in the next 12 months!
I get challenged each year to articulate upcoming financial services technology trends, and if you thought technology was embraced in this year, 2021 is set to see greater adoption that will deliver even higher quality efficient services to clients anywhere in the world.
Regulatory Technology (RegTech) is a topic you cannot escape when discussing Financial Technology (FinTech). It enables businesses to leverage advanced software for identity management, regulatory reporting, transaction monitoring, risk management and compliance software.
Trend #1 - Identity & Verification (ID&V)
RegTech saw a surge of rapidly deployable solutions in 2020, rescuing financial services businesses that relied on face to face business and needed to be able to remotely onboard clients. Solutions will remain in high demand for implementation throughout in 2021, being a low cost and simple to implement and use solution, that capture personal data, selfie video and photo ID then automatically validates whether the data captured is genuine, photo match the selfie video, documents are authentic and the individual is alive (commonly known as a liveliness test).
Trend #2 - Customer Lifecyle Management (CLM)
RegTech will be widely adopted in 2021 being a go-to platform for the entire business that manages the client from end-to-end, integrating ID&V solutions into automated workflow processes, offers rule-based logic, utilises Qualified Electronic Signature (QES) technology and integrates with management systems. They help assess risk continuously by monitoring and assessing clients from the point of enquiry, onboarding, service delivery and offboarding.
Trend #3 - A.I. Built Due Diligence Reports
They will de-risk business decisions in 2021. The production of subject due diligence reports isn’t a quick task for humans. But this is not the case for Artificial Intelligence (A.I.) with insights arriving in seconds. Leading suppliers use machine learning and natural language processing to read unstructured data sources in any and every language, understand local colloquialisms and provide insights back in any given language (which greatly differs from the common practice today of many of English-only structured data mining).
Trend #4 - Digitised operations will get a major upgrade in 2021”
Businesses have recognised for some time they needed to fully digitise, and 2020 saw a partial rapid move to achieving that from adoption of new software and hardware and cloud infrastructure. Some recognised that an implementation of cloud infrastructure helped them deliver data sovereignty in the location required and provides a major enhancement to their data security, whist reducing operational costs. 2021 will see laggards move to cloud infrastructure (Trend #4), and further efficiencies leveraged from productivity solutions.
Trend #5 - Robotic Process Automation (RPA)
It will become mainstream, supporting the delivery of repetitive tasks such as data input, data management, account reconciliation, prioritisation, document digitisation, testing and report automation. RPA will help business save money by reducing fraud, processing errors and payment discounts, and when combined with optical character recognition (OCR), which converts images to text to enable fast document search, it is a strategy that will be fully embraced and most firms will have an element of RPA in their business and it will be adopted on a ‘project by project’ basis.
Trend #6 - Advanced Coaching Solutions
They will boost productivity. Whilst rewarding, coaching people can be challenging and a constant activity for senior employees developing high-performance teams. When employees leave the business so does the transferred knowledge, team performance dips, and the cycle of transfer starts again. Inclusion of intuitive narrative built into software will enable any employees to complete tasks with confidence and accuracy. And a focus on online software training and support programmes will also enable employees to make better use of software rolled out in 2020.
There are so many more trends more to watch out for in 2021, such as trust company client portals (Trend #7), widespread adoption of QES (Trend #8), mainstream understanding of blockchain (Trend #9), and cryptographic forensic investigations (Trend #10), which will be changing business operations in international finance centres. Whilst the level of disruption we will experience in 2021 is still uncertain, what is a given is that the events of 2020 have led businesses, that otherwise might have taken another four years to adopt technology, to embrace it and to feel its value.
Article first appeared in Business Life Issue 71