Transforming banking systems' technological infrastructure for income growth and operational effectiveness
In the ever-evolving landscape of financial services, organisations are focusing on strategic initiatives to boost efficiency and revenue in 2025. These key strategies revolve around data management, AI adoption, hyperautomation, and adapting to generational change.
One of the primary areas of focus is data modernization and real-time integration. Financial institutions are prioritising the improvement of data quality and privacy while integrating real-time data feeds across financial, operational, and market systems. This enables continuous accounting and forecasting, enhancing liquidity management and responsiveness to market changes [1][2].
Another crucial aspect is the adoption of advanced AI and generative AI. These technologies are being utilised to enhance predictive analytics, automate the creation of narrative forecast reports, detect anomalies for fraud prevention, and adapt financial models dynamically. This shift transforms financial processes from automated execution to intelligent and proactive decision-making [1][2][3].
Hyperautomation is another significant strategy, combining AI, machine learning, and robotic process automation (RPA), to create seamless end-to-end workflows. This reduces human manual tasks, accelerates processes, and enhances operational efficiency across business processes [4].
Core modernization with a focus on customer experience and security is also a priority. Banks are balancing security investments with customer experience improvements, leveraging modern digital channels and complying with evolving standards (like ISO 20022) to differentiate offerings and improve payments systems [1][3].
Personalization through AI and big data analytics is essential in today's market, where banking experiences are moving from branch-centric to app- and data-driven. AI-powered analytics enable hyper-personalized customer interactions, improving engagement and retention [3].
While not extensively detailed, the push toward personalization, digital channels, and next-gen automation implicitly addresses generational shifts by meeting the expectations of younger, tech-savvy customers who demand seamless and instantaneous financial services.
In summary, to enhance efficiency and revenue, financial services organisations should modernise and integrate their data systems for real-time insights, leverage advanced and generative AI for smarter forecasting and operational insights, employ hyperautomation to streamline workflows, and enhance customer security and experience through personalisation and core system modernisation. These strategies align with broader industry trends toward agile, intelligent, and customer-centric financial services [1][2][3][4][5].
Furthermore, next-generation core banking platforms are composed of modular elements for functions like payments, lending, and wire activities. These platforms allow for quick adaptation with innovation and less risk, as only one module needs to be rolled back if an issue arises.
The great wealth transfer is reshaping inter-generational banking, and financial institutions must understand where their next generation of accountholders is coming from to prevent large outflows of capital. A smart strategy is necessary for financial institutions to position themselves for this shift.
However, the biggest technology gap for banks is a lack of human capital with expertise in managing modern technology, change management, and co-innovation risks. Talent management is critical in banking technology, as modern infrastructure and innovation de-risk tech stacks but also introduce new risks.
Lastly, a significant trend in banking this year is the need for financial institutions to connect with younger accountholders seeking a seamless mobile and digital banking experience. Expertise in wealth management may not be in-house, but banks and credit unions should be able to direct younger generations to those resources. The scalable, cloud-native nature of these platforms improves speed to market, making it easier for financial institutions to adapt and thrive in the digital age.
- Financing the upgrade to next-generation core banking platforms, which are composed of modular elements for functions like payments, lending, and wire activities, could enable financial institutions to quickly adapt with innovation and less risk.
- Given the need for financial institutions to connect with younger accountholders seeking a seamless mobile and digital banking experience, building expertise in data-and-cloud-computing technologies and attracting talent with skillsets in managing modern technology and change management becomes crucial.
- In striving to meet the expectations of younger, tech-savvy customers for seamless and instantaneous banking services, financial organisations should also focus on the environment, integrating sustainable practices and eco-friendly technologies to lessen their carbon footprint and demonstrate a commitment to the well-being of the planet.
