In the past year, the banking industry and the world around us have changed more rapidly than ever before, and will most likely continue to evolve even faster in the future. With the pandemic creating a period of unprecedented turmoil and opportunity, what was once considered ‘business as usual’ no longer exists.
During such a time of economic uncertainty, increased competition, changing consumer expectations, and new technological advances, financial institutions need to prioritize between short-term and long-term business objectives and open their doors to enable a complete banking ecosystem transformation.
To meet the customers’ needs and expectations, traditional and non-traditional financial institutions need to align their products and services in a way that creates the most value. One way to do this is through bank integration. The ultimate goal is to integrate banking into a consumer’s daily life, making banking an invisible but crucial value proposition that goes beyond financial services.
What Does Banking Integration Mean?
Banking integration is a complex process that interconnects cross-border banking activities and cross-border flows of banking assets.
Many countries have removed key regulatory barriers to international banking over the past two to three decades. As a result of technological advances, financial organisations can also now manage larger information flows across more locations and evaluate and manage risks at lower costs than ever before.
With the rapid growth of corporations and technology enabling cross-border banking capabilities, there is a rising demand for more complex international services. Although multiple technological advances have been made in the banking industry, it still has a long way to go before it can be globally integrated.
What Are The Benefits Of Banking Integration?
International financial services are now more in demand globally, as a result of corporate activity. With bank integration, the following benefits can be realized:
Transactions occur in real-time, so whether the transaction is between two countries or two continents, account balances will be updated in mere seconds.
Systems Can Share Information
With heightened security measures, institutions can share information across the globe, making for an efficient internal process.
Centralization Of Services
Having full control over their customers’ needs, the banks will be able to offer advice, loans, transfers, and financing services. Consequently, everything is conducted under a single administration and with greater order.
Helping Customers In Their Operations
As a result of bank integration, individuals can get answers and services tailored to their needs. Due to the infinity of APIs that exist and that can arise, everything is much simpler. The only requirement is access to technology.
The Future of Bank Integration
Banking institutions that are hindered by insufficient IT resources, governance and compliance issues, or stifling regulations risk losing customers, income, and becoming irrelevant.
In order to remain competitive, banks must critically evaluate existing banking structures and align them with international policies such as foreign exchange and cash management. Having such a strong foundation will mean that new platforms will become well suited for bank integration. Financial institutions should look at making the most out of this opportunity as it can benefit them in many ways.