Digitalization is the way forward for survival

Miljan Stamenkovic, Regional Director, Mambu discusses how COVID-19 has transformed various aspects of our lives and financial sector in specific and elucidates the steps to be taken by the financial institutions to prepare for a post-COVID-19 world.
COVID-19 is having a transformative effect across societies, economics and offices. The tremors of this crisis have been felt in every aspect of life, highlighting the need to be able to adapt rapidly.

The impact of the Coronavirus has been a shock reverberating across every aspect of our lives and in every business. In the financial sector, the current global pandemic is forcing the hands of both fintechs and established financial institutions to prepare for a post-COVID-19 world.

As many countries are beginning to relax, or look at relaxing, measures imposed as a result of the crisis, institutions need to be ready to rapidly evolve to address a very different world and a possible recession. The future of financial services is a moving target, and institutions must streamline their operations and be able to cost-effectively bring the right products to the right customers.

It is important that companies are able to adapt in order to ensure a smooth reopening of financial markets and the economy, whether that be digital or physical.

Being agile won’t just save us, it will sustain us

To succeed in a market that keeps changing, you need to be able to move quickly and be agile, composing new products and services faster.

Even with restrictions relaxing in many countries, the expectation is that many employees will continue to work from home and that face-to-face interactions will continue to be limited. The value of enabling an agile workforce through digitalization has increased even more. Simply put, new solutions are needed across many industries, and the push for digital remains a top priority.

There are also millions unable to work who are receiving support from governments backed by banks and financial institutions by implementing measures like payment holidays and delayed interest payments. This is where the ability to be agile and flexible and work in a dynamic environment is vital.

Investing in digitalization and putting it at the center of the business strategy provides a competitive edge and longevity. To build the best experience, financial institutions need to start changing with the market, instead of hoping the market will stop changing.

Enter composable banking

Today, even the simplest banking service involves a complex orchestration of core systems, transaction processing, decision-making, reporting, analytics, authentication, security and more. Monolithic platforms make it harder to incorporate the latest capabilities and tools, and the opportunity for financial institutions today is to replace any component whenever needed without embracing new technical risk.

Composable banking is a new approach to building banks and lending businesses that treats change as a constant. It is about having the control to use fit-for-purpose technologies to compose precisely the right design and delivery of financial services infrastructure.

With fintechs coming in and attracting customers with digital offerings, it becomes increasingly important for the established ones, like the big banks, to work on retaining their customers by digitizing and fast. To serve an agile market, financial institutions need to compose new products and features faster than everyone else to predict demand and to serve existing customers better.

Composable banking offers innovative solutions for organizations to create their own architecture for new products and services faster. It helps financial institutions create modern customer experiences to compete in the fintech era — and constantly evolve them to respond to change.

Embracing the fintech era

COVID-19 has had a transformative effect across societies, economics and offices. As market dynamics keep on changing, both fintech and established financial institutions have a chance to make a positive impact on their customers.

There is one thing in common for organizations, regardless of how far they have come with digitalization. The COVID-19 pandemic has made it clear that you can no longer manage your business the same way as before.

In the long-term, companies can choose to embrace the new world based on rapid evolution and modern ways of working or continue on the old paths which will see them unable to adapt when needed most.

For many businesses, adopting new and agile ways of operating based on composable banking will help guide their path and prepare them for the very different time that lies ahead of us.