Technology will have a major impact on transaction banking in three major areas, says Standard Chartered’s Gautam Jain.
The first is providing consistency of experience on the service and advisory sides, where it is important to ensure a seamless transition from device to device. Go back10 or 15 years to when the internet became mainstream, Jain says, and banks lacked the tools to provide a tailored user experience for corporate treasurers and other end users. Today, technology enables customisable dashboards and screens, so a bank’s global infrastructure should ensure that clients see the same thing on the mobile, desktop and host-to-host, with the new technology enabling ‘this size fits me’.
The second area is data. While information is power, the key ability is to take the data you have and present it in a more analytical way, says Jain. People are talking a lot about ‘big data’ and what they really need to focus on is establishing the problem and how the data can help clients manage working capital, mitigate risk and become more efficient.
The third area of technological development is the cloud, and Jain firmly believes that more services will eventually migrate to the cloud. The advantages will be immense, and include taking away the physical footprint of technology hardware. On the banking and corporate and regulatory sides, however, it’s taking time to find out what it all means. Regulators have sounded a cautionary note, so Standard Chartered will not ‘go big’ into cloud until it has the right permissions. Since the security is robust, he believes that concerns around security will subside, just as they did with the internet – although the public cloud obviously remains more of a concern than the private, or hybrid, cloud solutions.
Electronic bank management (eBAM) and e-invoicing are two functional areas where Jain also expects major changes, although two things need to happen first. Firstly, regulators need to get comfortable with recognising mandates received electronically, and the second is the process of account management. When processes become electronic, corporates should first look at the process efficiency, then simplify processes before implementing technology changes. Technology is the easy part, he says, and what will take time is customer education, changing regulation and mindsets.
The Impact of Mobile
Jain sees mobile as a game changer. While banks have traditionally just put their internet channels on mobile, he thinks that its role is set to expand and the game changer will be tablets. As an example, Standard Chartered recently launched a research app on the iPad and clients can have access to all of the bank’s research, while it is also developing intuitive treasury dashboards.
While mobile is playing a role in person-to-person and wallets an important application in the future will be collections, which is a pain point for many companies. Corporates often have to collect cash in remote locations, and transporting cash is time-consuming and expensive. If that process becomes mobile, it solves the information problem and reduces the cycle time as well as costs.
Although tablets are likely to be the next big device, he still expects corporate clients to continue using phones for some time, along with chief financial officers (CFOs) and treasurers who have to authorise or check cash positions. As mobile moves to analytics and cash flow positions, however, a smartphone won’t work and the game changers are going to be tablets.
Making Change Happen
All of this change will not happen overnight, Jain says. Any new technology takes time for adoption, and large corporates have policies that will take time to revise. When they see the value, though, they will change. While corporates were afraid of internet banking, for example, 95% of payments now come through electronic channels.
Technology will have a significant effect on improving personal productivity too. In the past, he says, reviewing a presentation meant printing a copy and hand-writing notes. Now, an individual scribbles notes on pdf copies of presentations and sends action items to staff immediately.
People have started to realise how they can be more efficient. And as the younger generation pushes for the same technology in the office that they have at home rather than traditional desktop technology, the rate of change may even accelerate.
While change may take time immense improvements in processes and efficiency, as well as reductions in cost, look as though they will be making their way into corporates’ business models before too long.
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