Three Trends Shaping the Financial Services Sector
We won’t be the first to tell you that these are unprecedented times.
For more than two years, the pandemic has changed how we live and work, challenging financial institutions to keep pace with and adapt to a brave new world.
To stay relevant, firms need a renewed focus on attracting diverse talent to help embrace technology and create sustainable business models while rethinking the workplace and partnering in new ways to innovate and increase efficiency.
Near-term concerns and long-term opportunities offer a strong argument for businesses to be bold going forwards.
Although volatility is still high, the markets have mostly stabilised and recovered markedly from their initial lows.
Our specialists suggest that the financial services sector will be hit hardest by second-order effects.
These are mid-long-term effects such as the deteriorating credit quality of corporate and personal customers and a continued low-interest-rate environment, as the pandemic and its after-effects will be felt throughout the economy over the next several years.
These recent events have led to unprecedented challenges for the financial services industry, creating new disruptions and dramatically accelerating others already underway. Depending on your perspective, the future of the industry will either be perilous or promising.
We choose to focus on the latter.
So, which future trends should you look out for as we move through the second quarter of 2022 and beyond?
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"Even as the crisis battered several industries, it had a mixed and relatively modest impact on the financial services sector. Insurers have benefitted from consumers staying close to home and the subsequent reduced claims frequency in personal lines.
Higher trading revenues due to market volatility have boosted capital markets businesses, whilst central bank activities and government support of companies and individuals have so far limited damage to bank balance sheets."
A Digital Focus
Every day the digital world changes.
It is in the digital world that many well-established institutions can fall behind their competitors by neglecting the value that financial technology brings.
Our latest insights cover three concepts to look out for on 2022’s horizon and beyond:
- Strong Customer Authentication
Banking on Sustainability
The world stands at a crucial moment in the fight against climate change. We are surrounded by sobering statistics that remind us of its importance.
These are unprecedented times, and they require urgent action.
That sentiment is reflected in the eyes of consumers who recognise the need for companies to act responsibly. Globally, sustainability is rated as an important purchase criterion for 60% of consumers.
You can take positive action when it comes to sustainability.
A Changed Working World
In 2020, much of the world’s workforce was sent home.
It was a change that happened almost overnight, brought on by the pandemic, but its arrival had been coming for a while.
You might feel a little daunted by the number of challenges presented by hybrid working. But there are also plenty of benefits to be had.
Think about it in terms of cost management:
- Office consumables
- Document production