The Top 5 Tech Strategies for Financial Institutions in 2025: A Comprehensive Guide.

Here are the top five technology strategies that financial institutions should prioritize to adapt to market trends and create sustainable value by 2025:

1. Embrace Digital Transformation and Invest in Emerging Technologies

To maintain their edge in the rapidly evolving world of finance, financial institutions must adopt advanced technologies and innovative processes. This not only enhances operational efficiency but also improves customer experience and optimizes overall performance. Banks, building societies, and other financial entities need to develop creative solutions that promptly and accurately meet customer needs.

This includes upgrading hardware and software systems, integrating cloud computing solutions, and leveraging breakthrough technologies such as artificial intelligence, big data analytics, and machine learning to optimize operations and extract valuable insights, thereby boosting business effectiveness.

2. Foster Collaboration with Fintech Companies

Collaborating with fintech companies offers valuable opportunities for financial institutions to maintain their competitiveness and drive innovation. Organizations can effectively address the barriers of digital transformation by leveraging multi-channel digital banking solutions.

Partnering with fintech companies, technology providers, and other financial institutions can propel UK financial institutions forward in their technological journey. The DTSVN platform is specifically designed for seamless integration with multiple fintech solutions, enabling banks to swiftly adopt advanced technologies without extensive system redevelopment.

This adaptability allows banks to expand their services and, ultimately, strengthen their competitive advantage. Through collaboration, organizations can pool knowledge, resources, and expertise to create innovative solutions and stay at the forefront of the industry.

3. Open Banking and Embedded Finance

The financial industry is becoming increasingly competitive, with fintech companies and tech giants entering the market. Open banking empowers financial institutions to leverage customer data (with consent) to offer personalized financial solutions, enhancing satisfaction and fostering loyalty.

Embedded finance seamlessly integrates banking services into non-financial platforms, enabling in-app payments and financial options. This strategy not only broadens the customer reach of banks but also enhances their market presence by offering banking services on e-commerce platforms or ride-sharing apps, attracting new customer segments and driving growth.

The upcoming Data and Digital Information Protection regulations will provide clear guidelines for implementing Open Banking, making it easier for banks to comply. This regulatory clarity will help banks understand their obligations and the steps needed to comply, reducing uncertainty and promoting a more predictable business environment.

This standardization may simplify banking processes, reduce compliance costs, and facilitate easier integration with third-party providers. The law aims to enhance data security and privacy standards.

By adhering to these regulations, banks can ensure customer data protection against breaches and misuse, thereby fostering trust. This transparency can strengthen consumer confidence in banks, as customers feel more secure about their data privacy.

4. Prioritize Customer Experience

Improving customer experience should be a top priority in enhancing the technology roadmap for financial institutions. By harnessing the power of technology, organizations can deliver tailored services, seamless digital interactions, and convenient self-service options. This includes developing user-friendly mobile applications, integrating chatbots for customer support, and leveraging data analytics to understand customer preferences and behaviors.

5. Low-Code Solutions

To address talent and IT expertise limitations, financial institutions should explore the potential of low-code solutions to streamline the workload of developers.

Low-code platforms offer a rapid path to application development, empowering banks to efficiently build, test, and deploy new digital solutions. With user-friendly interfaces and drag-and-drop functionality, these platforms simplify the development process, enabling team members with limited programming knowledge to actively contribute to application creation. As a result, banks can tap into a broader talent pool, including business analysts and other non-technical staff, to drive application development and maintenance.

By lowering the barrier to entry for application development, low-code platforms provide banks with opportunities to cut costs associated with hiring and training specialized IT personnel. By empowering current employees to acquire low-code skills, banks can enhance the efficiency of their workforce, reduce reliance on costly external developers, and maximize the value of their existing talent pool.

Source: ebanKIT

Compiled by DTSVN Group –Digital Transformation Solutions for the Finance and Banking Industry