Select Page

3 years later: What’s changed in financial services since the pandemic hit

Apr 10, 2023 | Admin, Financial Services, Latest News

Three years ago the entire globe was thrust into crisis as COVID-19 spread and altered the way we think about and do nearly everything. Financial services, especially so, had to rethink everything from the mental health of its own corporate culture to how to remain a dependable resource for weary customers wading through uncharted waters with their finances in 2020 and beyond.

In short, this meant financial services had to become faster, sleeker, and smarter than it already was to pivot repeatedly for constantly changing customer wishes. 

On top of all the swift changes in customer expectations for self-service, agent support, and general ease of doing business with their financial services providers, another industry trend that’s picked up pace since the pandemic began is the “Great Wealth transfer” or the projected movement of roughly $84 trillion in assets to children and grandchildren over the next two decades. This means not only are customer demands changing across all ages, but the customers with the most assets to manage will soon rapidly shift ownership to younger generations—generations with very different instincts regarding money management and a greater willingness than their predecessors to jump ship to find what precisely they’re looking for. 

Will your organization be it?

The financial services landscape is always in a state of flux and constant adaptation, but the current post-pandemic precipice is particularly disrupting and will force traditional models to reimagine and revamp their approach to operations and customer service. 

Three of the biggest changes in the past three years that will demand attention from any financial services organization intending to remain relevant include the need for an adaptable technology foundation, embedded finance opportunities, and secure and speedy services for customers. 


Scaling with an adaptable technology foundation

First things first: financial institutions today need to invest in a technology foundation that can grow with them. That means a technical infrastructure that is designed from the start to adapt and change alongside customer needs and expectations. Anthony Morris, SVP of Global Banking Strategy & Customer Advisory at nCino, recently noted in Forbes that most banking and lending institutions aren’t currently structured to manage change properly.

“Banks must ensure that their investments can help them build a technology stack that is open, well-defined and works well with other systems and services,” said Morris. “The days of solving for a single-use case or one specific problem are over. Every use case, every transaction, every interaction is part of a connected journey.” 

Such adaptable technology frameworks in financial services are critical for more than just changes to the everyday customer’s demands. A Thomson Reuters regulatory outlook for the industry noted how near-term economic pressures, climate risks, and geopolitical tensions will also force financial services to become more resilient and agile than ever before.


Using embedded finance to meet customers where they need you most

Another change that has picked up exponentially since the pandemic began is embedded finance—financial products that break the walls of both brick-and-mortar institutions and their company’s digital HQ or mobile app and instead pop up exactly when and where the customer needs them: in non-banking experiences. For example, buy now pay later solutions are a popular instance of this, as well as the way transactions work directly within the Uber app. Financial transactions that take place right when the customer is looking for them—that’s embedded finance. And, more often than not, these opportunities arise not when they’re checking out account balances on their bank’s mobile app or reviewing retirement projections through their investment manager’s portal. 

Embedded finance holds opportunities for both traditional financial organizations and modern fintech companies. Home loans that are offered in real-time while touring a house. Cards that automatically pay for gas when the associated car is fueling up at the station. And much more. Open banking data, APIs, and advancements in analytics are all part of the technology that is making these embedded finance experiences not only possible but more expected. In short, traditional financial services organizations “will have to embrace cross-industrial platforms. These new platforms dismantle the barriers between traditional industries, reshaping customer behavior and turning formerly linear value chains into ecosystems that fulfill customer needs in new ways.”


Delivering faster, more secure services as much as possible

Most importantly, whether you get there with an evolved technology foundation built to scale or by leveraging new products in the embedded finance space, customers will continue to push institutions to be faster in delivering the services they need—but still with top-notch security they can trust. Open banking solutions have made it easier for many financial services organizations to provide convenient, speedy transactional service to their customer base. In addition, AI is presenting strong use cases for more secure governance and fraud prevention in the industry, another way to prove your worthiness to skeptical customers, especially in fraught economic conditions. 

The look and feel of financial services today—whether it’s banking and insurance or estate management and fintech startups—is drastically different than it was just three short years ago. Keeping up, much less getting ahead, can seem nearly impossible. But with a strategic partner on your side to take on the heavy lifting of cloud technology analysis, design, build, and maintenance, innovative business in the financial services sector can be second nature.