PwC Highlights Tech-driven Forces to Shape Financial Services

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Obinna Chima

The financial services industry has seen some dramatic technology-led changes over the past few years. While FinTech start-ups are encroaching upon established markets, many executives look to their information technology departments to improve efficiency and facilitate innovation, while somehow also lowering costs and continuing to support legacy systems.

In support of this, PwC’s new report “Financial Services Technology 2020 and Beyond: Embracing disruption,” that was obtained monday, captures 10 technological advances on the industry.

The ten technology forces that matter according to the report are: finTech will drive the new business model; the sharing economy will be embedded in every part of the financial system; Blockchain will shake things up, and that digital would become mainstream.

In addition, it indicated that customer intelligence will be the most important predictor of revenue growth and profitability; the public cloud will become the dominant infrastructure model, and cyber-security will be one of the top risks facing financial institutions, among others

Commenting on the findings, Partner and Financial Services Leader, PwC Nigeria, Patrick Obianwa, said: “Those at the heart of financial institutions know there’s no easy way to embrace this unprecedented disruption. The public cloud is already safe and reliable enough to outcompete on-premises solutions

“Soon, Blockchain may prove to have the same impact on the future of banking as the Internet had on physical stores. You get the feeling that it’s only a little while before banking operations centres are staffed by sophisticated robots, taking over manual tasks from human tellers.”

It also stressed the need for CIOs and other executives to be innovative with technologies, competitors and markets change, and have the skilled resources to do so.

Therefore, it’s vital they can identify the imminent threats and opportunities that will be affecting their operating model, human capital approach, ability to innovate and ability to execute, the report added.

Also commenting on the report, Partner and Chief Economist at PwC Nigeria, Andrew S. Nevin said: “There are many large forces sweeping society, from demographic and social changes to shifts in global economic power. But one force in particular – namely, technological breakthroughs – is having a disproportionate effect on financial services.

“By 2020, consumers will need banking services, but they may not turn to a bank to get them. This is not fantasy; it is where things are headed. It is now becoming obvious that the accelerating pace of technological change is the most creative force – and also the most destructive – in the financial services ecosystem today. In this report, we set out to capture the real world implications of these technological advances on the financial services industry and those who must supervise and use it.”