Staying relevant through digital transformation and tech partnerships in 2022

The world is digital-first and therefore our solutions must be cloud-native, API-first, built for robustness and scale, from the ground up.

Leda Glyptis, Chief Client Officer at 10x Banking

Over recent years it's become clear that digital capabilities have to be the cornerstone of any bank's strategy. Digital-native entrants into the regulated financial services industry have generated more choice for customers, which has created new competition for traditional banks and other lenders in 2022.

Many welcome this disruption, seeing it as an opportunity to foster innovation and increase financial inclusion with, for example, fresh approaches to the way they provide loans and payments. That's the view of Pete Murray, ASEAN Head of Financial Services at Amazon Web Services. He cites the example of Thai Credit Retail Bank, which has worked with AWS to improve SME customer access to financial services, and so help reduce their previous reliance on informal financing channels, like loan sharks.

Digitisation for a better customer experience

Data-driven, digital, automated business lending — using machine learning to predict risk — is much more than an opportunity for the banking industry. It's actually a pressing need, given the extent to which the SME sector is underserved.

"Evolution in open banking makes it easier to use the data to do better risk assessments and thereby offer credit more effectively," says Halvor Lande, CEO, Aprila Bank.

The resulting instant gratification is a great value proposition for customers. In Australia, banks “will work towards service levels of 24-hours-to-yes and next-day funding, which will be a long process requiring continued focus," says Anna Jones, Chief of Product at the Financial Supply Chain Strategic Advisory, adding:

“Global financiers will likely enter the Australian market, offering corporate clients an integrated view of their multiple ERP systems. Clients who share data with the financier can be offered solutions aligned to their working-capital objectives.”

The deeper relationships will benefit both borrowers and lenders.

Get more predictions for 2022

This article is based on Business Finance Predictions 2022, a Trade Ledger report, in which a range of industry experts share their insights into what lies ahead for 2022. In addition to digital transformation and tech partnerships, find out their views on:

• Customer-first lending journeys
• Better, more cost-effective credit decisions
• Forward-looking business models
• Building a sustainable future

Look out for more articles in this series, or download the report now.

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