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Since trust in financial technology has enraptured the industry, Vijayakumar Ekambaram, ANZ BFSI Segment Head from Tata Consultancy Services, answers the burning questions around this issue.
Posted: June 2021
Q: What does it mean to trust a financial business in 2021?
The integration of technology and financial services has revolutionised the sector and our interactions with the brands that sit within it; traditional pen and paper transactions are now available at the touch of a button. To trust a financial business is to feel secure in how it manages and protects your financial assets, as well as how it allows you to access them. It’s also about providing a consistent experience that communicates the products and services available, the security that is in place, and how they are seamlessly integrated, resulting in a better experience for the customer.
Q: How can businesses address consumer trust in the digital space?
Many of the changes in the financial services space have been adopted to speed up the institutional process and expand service portfolios. More importantly, they have been integrated to resolve customers' pain points – timely processes, paperwork, and product complexities. Digital solutions allow for real-time updates that can provide trust and transparency for consumers. The 'always-on' aspect of new technology will enable consumers to have a front-row seat to how their finances are tracking and make changes accordingly. There is a degree of self-service that has been factored into solutions by financial providers to allow for better access but with the same institutional support and guidance level.
Q: What are some local finance businesses that are building trust in the market?
The digital revolution has opened the door for new players to enter the financial market and bring diversity to an industry that, in Australia, has been dominated by the big four banks. In recent years, there has been a proliferation of brands in Australia that have changed how people and businesses spend, save and manage their money. Companies such as Afterpay and ZipPay have reinvented the buy now, pay later realm, offering a new solution that moves away from credit cards' pressures. Their popularity in the market results from responding to the needs of consumers and retailers, offering better ways for people to spend.
Digital banks and online stock brokerages have also become increasingly popular because of their ease of use, giving people the ability to apply for services and manage accounts at the click of a button. These new solutions have aligned with the increasing dependency of mobile devices, using apps to better connect with consumers and provide a familiar and always accessible platform.
Q: How can businesses address trust in financial technology and the reluctance in older markets?
The introduction of new technology and solutions is often met with scepticism, especially when it’s within an industry that is as established and essential as the financial sector. Customers and businesses are often aware of the pain points that exist. Still, they are reluctant to welcome change due to unfamiliarity or confusion on what those changes mean in terms of their assets' management and care. Financial providers, thus, need to lead conversations around why change is happening, be clear about the benefits to the user and customer experience and what the transition period will look like.
Concerns around data privacy, financial security and potential scams are some of the main concerns for consumers regarding digital solutions, with some people seeing the traditional paper trail processes as a more secure way of monitoring assets. Positioning new solutions as a form of upgrading legacy systems rather than a complete overhaul is one way that financial institutions can ease consumers' minds and gain trust. Ongoing communication and offering customer feedback can also help make the process less daunting and encourage exploration and adoption of new ways of interacting with service providers.
Q: How can businesses address the mistrust in data?
Data insights provide a powerful tool in identifying consumer trends, assessing productivity and allowing for better transparency for customers. From an advisory and consultancy perspective, customers still want personalised feedback and guidance that allows for bilateral communication; data doesn’t respond to questions. Instead, it just lays out the facts. Mistrust in data can be overcome by presenting it in the right format and as a tool for starting discussions rather than as a definitive answer.