The challenges facing the Financial Sector
This sector is facing a range of challenges right now. As well as the issues posed as a result of Covid-19, these firms are also dealing with the impact of Brexit and a rapidly-evolving technology and regulatory environment. In fact, research by PwC in 2020 found regulation changes (80 per cent) and acceleration in digital technologies (77 per cent) are the biggest disruptors for financial services organisations.
The need for improved customer service in Finance
Improvements in technology over the last few years have seen a huge number of new firms emerge to compete with established financial services brands. Companies such as ‘challenger banks’ are usually online and mobile-only, which means they have far fewer overheads compared with legacy competitors and are particularly aimed at younger, tech-savvy customers who are comfortable interacting via digital channels.
In banking, for instance, figures from McKinsey suggest 80% of customer touchpoints take place via digital channels. What’s more, some nine million people in the UK have opened accounts with digital-only services. This places more pressure on banks, insurance providers and other financial services firms to up their game.
To do this, they’ll need an effective omnichannel contact centre that enables people to get support on whichever platform they prefer and lets them switch seamlessly between channels without disruption. Improving wait times will be a major part of this, as research by TTI Global suggests this remains a major frustration for financial services customers.
Meeting the IT regulatory requirements
By their nature, financial services firms are required to deal with people’s most sensitive and confidential information, which makes them some of the economy’s most heavily-regulated businesses. At times, these rules can seem onerous or even contradictory, but the penalties for breaches are high, so maintaining compliance must be a top priority, especially in an increasingly digital environment.
For instance, industry-specific requirements such as MiFID II demand that investment firms maintain full, transparent records of all their activities. On the other hand, data protection rules such as GDPR require businesses to delete any unnecessary data. Finding a balance between these demands will therefore be a challenge for many firms.
How could the rise of home working affect the finance sector?
Like the rest of the economy, many financial services businesses saw a sudden and unexpected shift to remote working in 2020 as a result of the Covid-19 pandemic. For example, the Financial Times noted that at Lloyds Bank, 50,000 of its 63,000 staff were working from home in the summer of 2020.
UK-based staff were also much slower to return to the workplace when lockdowns eased last summer. For instance, while almost two-thirds of Santander’s non-branch staff had returned to the office in Spain by August 2020, this figure was just 15 per cent in the UK, suggesting this trend is here to stay.
Indeed, many banks, building societies and insurance providers are setting up plans to reduce the number of workers in the office on a more permanent basis. Analyst firm Moody’s, for example, predicted a major drop in demand for office space in financial hubs across Europe, including the City of London.
Reimagining the contact centre
Remote working is set to have a big impact on a number of key activities, with the contact centre among those most affected. These departments have often had to reduce numbers to accommodate social distancing rules, which means more agents needing to access essential communication tools from home.
This means the future of the contact centre for financial services firms is likely to be virtual. In turn, this will mean firms will have to invest in advanced communication and collaboration technologies – both for internal and customer interactions – to keep productivity and customer experience levels high.
Addressing the security concerns
Another particular issue for this sector is the risk of security issues, which is especially acute when employees are outside the office, and the protection the firm’s network can provide.
Criminals have been quick to take advantage of this, with figures from HelpSystems revealing two-thirds of large financial services firms have suffered a cyber-attack in the past year, with 45% seeing a rise in attack attempts since the start of the Covid-19 pandemic.
One reason for this is that, with more internal communication taking place over digital platforms, employees may be more susceptible to email security threats such as spear-phishing. The use of personal devices outside the control of the IT department – whether desktop and laptop PCs or smartphones – that are also being used outside of work purposes also presents new risks if sensitive data is stored here.
The right technologies for the new environment
When it comes to embracing home working, tools such as cloud telephony services will be vital, especially for those in the contact centre. This ensures financial services firms can move systems from on-premise centres to home office environments quickly and easily, while giving agents full access to all the software and telephony tools they need to assist customers and meet regulatory requirements.
This should include features such as call recording, IVR technology and even video conferencing, as many consumers will still prefer a face-to-face chat, and video tools are able to help provide a more personal connection. They will naturally need a fast, reliable broadband infrastructure to function effectively.
When it comes to cybersecurity, advanced detection tools that utilise technologies like artificial intelligence and machine learning are essential in helping keep financial services firms safe. In an environment where employees may be working remotely without direct contact with colleagues and managers, these tools are crucial in helping block threats such as spear phishing and business email compromise attacks.
It’s also vital firms invest in secure web applications to maintain contact with customers, and have specialist recording and archiving facilities that meet all relevant regulations.
If you want to know more about the communications and collaboration technologies that will be essential if financial services firms are to meet the challenges of today’s environment, get in touch with one of Arrow’s expert advisors today.