As the banking and finance industries focus on digitalization, the technology landscape continues to evolve rapidly. Technological progress will transform today’s financial institutions into like-for-like institutions of tomorrow.
Digital transformation has served as an impetus for a fresh look at how banks are changing their business models in preparation for the next paradigm shift in banking.
We have witnessed an era of digital transformation and innovation in almost all BFSI sectors. The scope and scale of this transformation are so staggering that it calls for a detailed roadmap of what lies ahead.
No doubt, the evolution of digitalization has already started to make its presence felt in various BFSI sectors, creating new opportunities for growth, innovation, and efficiency across every stage.
In this decade, the banking industry has already witnessed many transformations. As technology is changing the face of banking, it also demands an overhaul in deal origination strategies.
The biggest BFSI trends to watch out for in 2022 will be primarily influenced by these changes, which may dictate any future course of action by banks and financial institutions.
Top Salient Trends that will Shape the BFSI sector in 2022
- Rise of Artificial Intelligence and Machine Learning
AI and machine learning make it easier for businesses to analyze large data sets. These applications analyze the data, patterns, and models of business processes in real time, helping to provide real-time decision-making.
These support drive effectiveness and increase efficiency.
Machines are a vital part of the future; you should expect to see many more in your life. You may still be unsure about how they work, but artificial intelligence (AI) and machine learning rapidly change how we all live.
- Sustainable Finance to Gain New Heights.
The world has changed since the discovery of the COVID-19 pandemic. The global impact of this pandemic, coupled with the COVID-19 climate conference, has caused corporations to implement ESG regulations in their firms and adopt more sustainable policies.
In 2022, corporate stakeholders and investors will jump on the bandwagon and increase their focus on implementing mandatory ESG regulations in their firms.
Sustainability-linked bonds (SLB) will also gain popularity thanks to climate change commitments.
- Cryptofication of Bank
With the rise in blockchain and cryptocurrency, banks are slowly incorporating and supporting cryptocurrencies. In 2022, many banks will jump on the crypto trading tack.
There are plenty of legitimate reasons for bankers to resist cryptocurrencies, but not anymore, as this resistance may turn futile.
Banks will see their bank’s peers offering crypto, and with this outright fear, many banker boards are pressuring the management to get into the crypto game.
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- Bank Branch into the Future of the New Normal
With the physical branch reimagined, banking institutions are moving towards building the branch of the future.
To compete with the existing digital banks and to provide an enhanced client experience, banks are moving towards showroom-style design that offers the benefits of face-to-face encounters while converting their physical locations into customer training centers.
It guides the consumers with the right advice and helps them learn the way to utilize technology to make their money go further.
- Mid-size Financial Institutions will Incorporate Real-time Payment Options
In 2022, 28% of mid-sized financial institutions will deploy real-time payments.
The deployment of real-time payments will put many financial institutions at the front and offer a competitive advantage to secure more of tomorrow’s fastest-growing companies.
Faster payments will be one aspect of a broader trend, thus offering a breakthrough for financial institutions in 2022.
The Bottom Line
The predictions outlined above are based on qualitative investigations of future trends and aren’t meant to be predictive. The trends appear to benefit the BFSI industry as they aim to generate meaningful consumer engagement.
We’re excited to see what happens!
For BFSI aspirants like you, this information may prove invaluable to your career prospects.
Whether you’re working in banking, accountancy, insurance, trading & so on, if you want to make your mark in the BFSI industry in 2022, you need to study, develop, and prepare for future trends.
You’ll have limited time to get a head start before 2023 arrives, making now the perfect time to start.