Global banking outlook 2014-15

Technology and innovation: enabler, differentiator, disruptor

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The amount of data that banks are required to collect, analyze, store and mine is growing exponentially as customers become omni-channel and make use of social networks.

Even before banks can think about using the data to provide more effective services to customers, they must overcome the significant burden of regulatory compliance. Tracking and reporting requirements have become much more onerous and legacy systems are struggling to cope.

Technology is being disruptive in other ways, enabling customers to obtain banking products and services (particularly payment services) from non-traditional sources. As new payment and e-wallet technology becomes more widespread, banks risk losing transaction fees and prominence in their customers’ minds.

Investment banking is also feeling the effects. We continue to see the further “electronification” of sales and trading, and OTC derivatives reforms have been a catalyst for new entrants looking to take advantage of the requirement that these products be traded on exchanges and cleared centrally.