Finastra reveals corporate bank priorities for 2025 as digitization and fintech collaboration accelerate
- New research outlines changing focus - a move away from the traditional 'relationship builder' approach of client interaction and management
- Digital transformation budgets set to increase by a third over the next five years in trade finance and cash management
LONDON, March 2, 2021 /PRNewswire/ -- Research from Finastra, unveiled today at its flagship (virtual) industry event – Finastra Universe – shows changing priorities for corporate banks and their customers over the next five years. It reveals that corporate banks are moving away from the traditional 'relationship builder' approach of client interaction and management (where they build wider banking relationships with clients to cross-sell additional services) towards being 'platform players' that offer value-added services and can deliver real-time execution.
Torsten Pull, SVP & General Manager for Corporate Banking at Finastra, said, "The pandemic has brought the future forward, forcing banks to adapt their operations in lending, trade finance and cash management, and accelerate digital transformation. To thrive, these organizations must change their business models, adopting new infrastructures that support the journey towards digital, end-to-end, platform-driven corporate banking. We wouldn't expect this shift to remove the role of the relationship manager, rather digitization enhances their ability to access insightful data for quicker decision making."
The research, which gauged the views of over 700 heads of relationship, technology and product across global corporate banks, shows how their priorities are changing over the next five years in line with their corporate clients' requirements. The responses show that corporates will prioritize online banking, value-added services, and real-time service and execution above their banks' range of products and services and relationship management in the next five years.
Corporate banks must respond. Appetite for change exists, as digital transformation budgets within these organizations are expected to increase by 2025:
- Cash management and trade finance - banks expect digital development budgets to grow by around 30%
- Lending - banks expect digital development budgets to increase by 20%
As relationship management falls in priority and the pandemic highlights gaps, corporate banks are changing their focus:
- Cloud technology and digital signature are the main tools that banks need as soon as possible:
- Around 19% of banks said that cloud is needed for their response to COVID-19, but that they don't currently have access to this technology (across cash management, lending and trade finance)
- Digital signature was also cited as a requirement, but 18% of banks do not currently have access to this (across cash management, lending and trade finance)
- Over 80% of lenders said that account validation was a key digitization priority too
Torsten added, "The need to deliver faster, more agile and more tailored corporate finance solutions across sectors is driving corporate banks to embark on a digital transformation journey. The agility and expertise of fintech partners will be essential, as will collaboration via open platforms. As these trends ramp up, our research shows that around 70%-75% of banks are already working with fintech partners, or plan to do so in the next year. It's a change to be embraced which will help to accelerate growth."
To find out more, attend our virtual Finastra Universe event kicking off today, with on demand content available for the rest of the month. Sign up here. To download the corporate banking research, click here.
For further information please contact:
Caroline Duff
Global Head of PR
T +44 (0)7917 613586
E [email protected]
About Finastra
Finastra is building an open platform that accelerates collaboration and innovation in financial services, creating better experiences for people, businesses and communities. Supported by the broadest and deepest portfolio of financial services software, Finastra delivers this vitally important technology to financial institutions of all sizes across the globe, including 90 of the world's top 100 banks. Our open architecture approach brings together a number of partners and innovators. Together we are leading the way in which applications are written, deployed and consumed in financial services to evolve with the changing needs of customers. Learn more at finastra.com
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SOURCE Finastra
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