As more markets adopt open banking — which mandates banks to open their
systems to third parties — it will be increasingly critical for banks to
ensure the security of not only their networks, but those of their
ecosystems partners as well, according to a report from Accenture (NYSE:
ACN) that predicts key technology trends in banking over the next three
years.
According to the Accenture
Banking Technology Vision 2019, while consumers trust banks to
securely hold their data, maintaining that trust as the industry shifts
toward open banking will require banks to strike the right balance
between robust security and easy-to-use customer experiences. While nine
in ten bankers (92 percent) believe that customer trust in banks’
ecosystem partners is very or extremely important, only 31 percent of
bankers say they know their ecosystem partners are working diligently to
be compliant and resilient with regard to security.
“Security is only as good as the weakest link in the network of
ecosystem partners, and the global trend toward open banking is
increasing the spiderweb of interconnectivity among banks and third
parties — creating additional points of weakness and vulnerability in
banks’ network security,” said Alan
McIntyre, global head of Accenture’s
Banking practice. “Customers trust their banks and are willing to
provide their personal data in exchange for relevant products and
services. To maintain this trust, banks must rethink their approach to
network security, focusing on the broader ecosystem, not just the bank.
This will require a shift from a compliance-centered approach to an
active cybersecurity stance.”
The Accenture Banking Technology Vision 2019 report draws on the
analysis of an advisory board of more than two dozen individuals,
interviews with technology luminaries and industry experts, and results
of a survey of nearly 800 bankers globally. This year’s report, with the
theme “The Post-Digital Era is Upon Us — Are you Ready for What’s
Next?,” showcases five upcoming technology trends — including “Secure Us
to Secure Me” — that banks should assess to help set themselves apart
from the competition, whether traditional banks, fintechs, big tech
companies, or other yet-to-be-determined newcomers.
The report’s “Get to Know Me” trend found that the primary use case for
banks to adopt new technologies is to help recapture customer intimacy,
replicating the experience associated with doing business with a
small-town bank. Most bankers surveyed believe that digital demographics
will give them a new way to identify market opportunities and unmet
customer needs (cited by 85 percent) and a more powerful way to
understand customers (83 percent). Having a better understanding of
customer behavior will also help banks protect their customers better,
as banks that truly know and understand their customers are less likely
to be fooled by fraudsters and imposters.
“Digital tools can provide banks with new, near-real-time information
about their customers and help them identify unmet customer needs,”
McIntyre said. “Creating a rich view of customers’ digital and
technology-driven activities is a powerful tool that banks can use to
get closer to tailoring their products and services to the illusive
‘segment of one.’”
As customer demand and technological innovation push banks to interact
with their customers on their terms, customization and real-time
delivery will raise the competitive stakes. According to the “My
Markets” trend, banks will need to offer the most relevant products and
services to their customers at the exact right moment in time, and many
believe that access to 5G networks will help them deliver on this
promise. Nearly four in five bank executives (78 percent) said that 5G
will revolutionize the banking industry by offering new ways to provide
products and services, such as faster video transmission to support
seamless delivery of financial advice. More than half (55 percent)
believe that 5G will have a significant impact on the industry within
three years, and an additional 20 percent believe that 5G will have a
significant impact in four to five years.
“The accelerated disruption in banking is likely to change the overall
industry structure,” McIntyre said. “Technology — including social,
mobile, analytics and cloud — has transformed financial services over
the past five years and become core to banks’ operating systems. Banks
need to evaluate the technologies that are likely to drive the next wave
of disruption; we refer to these technologies collectively as DARQ: distributed
ledger, artificial intelligence (AI), augmented reality
and quantum computing.”
Nearly half (47 percent) of the bankers surveyed believe that AI will
have the greatest impact on their organization in the next three years.
According to the “DARQ Power” trend, banks can reduce costs 20 to 25
percent by augmenting their operations using AI. While more than half of
banks are piloting or have adopted AI in one or more lines of business,
somewhat surprisingly one in five (20 percent) are not planning on
implementing AI or evaluating it for adoption.
At the same time, 19 percent of bankers said they believe that, of the
four DARQ technologies, quantum computing will have the greatest impact
on their bank over the next three years — while only 17 percent said the
same about distributed ledger/blockchain technology, perhaps an
indication that early adopters of blockchain technology are feeling
jaded.
The report’s fifth trend, “Human+ Worker,” notes that in addition to
keeping up with customer-driven innovation, banks also need to keep pace
with the innovation demanded by their workforce. Three-quarters (74
percent) of bank executives believe that their employees are more
digitally mature than their organization, causing the workforce to wait
for the bank to catch up. As banks continue to adopt technologies to
advance their organizations and as employees increasingly change roles
or move between organizations, training and reskilling is in high
demand. Nearly half (45 percent) of bank executives surveyed said that
more than 40 percent of their workforce has already moved into new roles
requiring substantial reskilling, and 71 percent expect that within
three years more than 40 percent of their workforce will move into new
roles requiring substantial reskilling.
A full copy of Accenture’s Banking Technology Vision 2019 can be
accessed at www.accenture.com/BankingTechVision.
Methodology
The Banking Technology Vision 2019 report is derived from the Accenture
Technology Vision, developed annually by the Accenture Labs and
Accenture Research. The research process included gathering input from
the Technology Vision External Advisory Board, a group comprising more
than two dozen experienced individuals from the public and private
sectors, academia, venture capital firms and entrepreneurial companies.
In addition, the Technology Vision team conducted interviews with
technology luminaries and industry experts, as well as with nearly 100
Accenture business leaders. In parallel, Accenture Research conducted a
global online survey of 6,672 business and IT executives to capture
insights into the adoption of emerging technologies. The survey helped
identify the key issues and priorities for technology adoption and
investment. Respondents were C-level executives and directors at
companies across 27 countries and 20 industries, with the majority
having annual revenues greater than US$6 billion.
The banking industry report is based on responses from nearly 800
respondents at banks in more than 25 countries across North America,
Europe, Asia-Pacific, Africa and South America. The survey helped
identify the key issues and priorities for technology adoption and
investment. Respondents were mostly C-level executives and directors,
with some functional and line-of-business leads, at companies with
annual revenues of at least US$500 million, with most having annual
revenues greater than US$6 billion.
About Accenture
Accenture is a leading global professional services company, providing a
broad range of services and solutions in strategy, consulting, digital,
technology and operations. Combining unmatched experience and
specialized skills across more than 40 industries and all business
functions — underpinned by the world’s largest delivery network —
Accenture works at the intersection of business and technology to help
clients improve their performance and create sustainable value for their
stakeholders. With 477,000 people serving clients in more than 120
countries, Accenture drives innovation to improve the way the world
works and lives. Visit us at www.accenture.com.
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