Inflation, elevated interest rates, and cost-of-living pressures have impacted consumers across the globe, resulting in many having had to use their savings to keep up. Sandstone Technology shares some of the trends that have “shaken up the world” in the year 2023.
According to the digital banking solutions company, five trends have caught the eye.
More Gen Z people have explored the features and services being offered by financial institutions (FI). James Sheldon, product manager for UK at Sandstone, said this generation tends to expect a different experience than what has been traditionally delivered by banks, including app-native origination with the use of biometrics and push notifications and features that enable customers to visualise the pathway to their financial goals.
“An expectation has been set by the challenger banks and fintechs, that a digital solution should help elevate a customer’s financial position, by offering the tools and services that facilitate their progress in the financial world,” said Sheldon.
Gen Z has proven to be one of the most vulnerable groups, Sandstone said in its blog. Governments have launched initiatives and ramped up regulatory requirements in 2023 to educate citizens and protect them from the threat of cyber scams.
Julio Kim, head of security at Sandstone, described 2023 as “another year marked by security incidents and data breaches”.
“It is imperative to select a partner who is not only specialised in their product offerings but also takes security and reliability seriously, adopting a holistic approach to keep the business running in a secure and compliant way,” said Kim.
The mobile app has transformed to become self-service banking now, Sandstone noted. People prefer to transact on their own terms and get it done as quickly as possible. The pandemic aggravated the demand for e-wallets and digital or mobile wallets for payments, and this resulted in banks increasing their focus on developing mobile-first strategies and offering services optimised by mobile users.
The fintech said FIs with dated, inflexible infrastructure will struggle to follow through with the advancement of digital banking, the blog said. “Unfortunately, if they don’t provide self-serve options, they will miss important banking benchmarks and lose out to competitors.”
With more people travelling around the world, international payments have also gone through innovative changes throughout the year, with the enablement of cross-border payments, the growth of real-time systems, payment rails, and improved interoperability across different payment systems.
A Citi-commissioned report said, “Payments are moving away from traditional instruction methods, which are tied to batch and files, and moving toward application programming interface (API) connectivity.”
Sandstone notes AI has been a hot topic in conferences throughout 2023, and this includes the UK Banking Transformation Summit held in June 2023.
Nam Vuong (pictured), head of business development at Sandstone, said AI and machine learning technology will allow FIs to compute a vast amount of complex data, but he notes this still requires a considerable amount of teaching to ensure results that aren’t “subjective”.
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