Future-Proofing Banks with Emerging Technologies

In a recent interaction with Asia Business Outlook, Lito Villanueva shares his views on how should banks adapt to the evolving payment landscape to ensure they remain competitive and meet the changing needs of their customers, how can banks identify the right processes for RPA implementation, and the key considerations for its successful deployment and more.

Payment technologies are rapidly evolving, how should banks adapt to the evolving payment landscape to ensure they remain competitive and meet the changing needs of their customers?

With cybersecurity being at the forefront of several concerns, the rapid evolution of payment technologies and their surge in dominance presents huge challenges. Although we celebrate the adoption of digital banking, e-wallets as well as other digital financial products, in the Philippines, we are also faced with the increasing threat of cybercrime that is driven by surge in number of malicious actors.

The increase in cybersecurity threats has become one of the major concerns for industry players from various sectors. This has led to collaborative efforts that are aimed at developing an industry-wide approach for addressing these issues. Promotion of efforts is at the core of our efforts and this is highly essential for our customers. In order to ensure that consumers are protected and uphold this trust, it is imperative for all industry players to engage in comprehensive cyber education as well as awareness campaigns in order to uphold this trust. While it is crucial to deliver exceptional customer experiences, it is also equally important to safeguard consumers from fraudulent activities executed by cybercriminals.

Also, payment technology must not merely focus on convenience but should also focus on financial inclusion, sustainable inclusion as well as financial literacy initiatives. The real challenge lies in meeting the specific requirements of numerous customer segments although digital finance applications as well as mobile applications have become accessible widely. Hence, banks must bundle their banking services with informative campaigns in order to guide consumers in optimizing the services & products provided by both banks & fintech players.

With various collaborations among fintechs and banks aimed at improving customer engagement while maintaining competitive edge in the market, the emergence of embedded finance is a huge development. Partnerships with several fintech players in wealth management, payment, lending or any other financial services or with platform providers, who specialize in cyber security, e-KYC, Loan management systems, or AI-enabled lending platforms, are designed with an aim to empower the customers. These collaborations facilitate customers in making informed decisions regarding the digital platforms, services & products which best meet their requirements.

Furthermore, such partnerships facilitate fintechs & banks in broadening their reach, serving a wide range of clients across the socio-economic spectrum. The strategy depends on every institution’s business goals and requirements when it comes to targeting the mass affluent, the mass market or specific segments. The key to communicating effectively with & meeting the requirements of their respective clientele is to leverage marketing technologies. 

Robotic Process Automation (RPA) can streamline repetitive and time-consuming tasks. How can banks identify the right processes for RPA implementation, and what are the key considerations for successful deployment?

Owing to its significant potential, RPAs help in reducing the time employees spend on repetitive & low-value tasks. Organizations today can free up their workforce for more productive tasks by assigning mundane jobs to RPAs. Therefore, the first step in this process is to consult employees and ensure that right from the introduction to the deployment of the implementation of RPAs, the employees feel empowered & are at the center of this internal transformation.

All internal changes need a robust change management process and it is crucial that all these initiatives are planned carefully for aligning stakeholders with the organization’s vision in order to ensure seamless execution right from vision to implementation. Furthermore, it is critical to select the right partner, vendor, or supplier. Banks with established, long-term relationships with vendors must explore RPA services which align with their strategic goals.

While the market currently provides a variety of vendors who are capable of offering similar RPA services, the selection of provider should be based on various criteria which include qualifications, organizational requirements, ensuring that the chosen partner can meet the objectives set forth.

It is important to consider the pace at which RPA technology evolves. Since not all Robotic Process Automation services & are created equal, it is crucial to evaluate the level of investment that technology partners make in their solutions, & how regularly they update & enhance their platforms for meeting the industry standards & customer requirements. The ability of the vendor to stay current with the industry development & deliver innovations will facilitate the contracting company to implement these advancements effectively and this in turn will help in achieving continued success as well as alignment with industry trends.

As banks increasingly adopt digital technologies, what are the key cybersecurity challenges facing banks today, and how can they future-proof their systems against evolving threats?

Fraud is one of the significant challenges across industries and this is true for the banking and finance industry as well. Although, the persistent problem of fraud can be combatted with the AI tools & RPA as it equips banking and fintech with powerful tools, this issue continues to be one of the major concerns for industry players. Hence it is not sufficient for banks & fintechs to focus only on making huge investments in technology but these organizations should also ensure that their employees should be at the forefront of developing & improving these solutions. Also, training is highly essential for scaling the skills and talents of employees,         & ensuring that fraudsters do not move two or three steps ahead. Thus, investing in the right technology along with comprehensive training is crucial.

Furthermore, continuous consumer education & awareness campaign are important for preparing customers for potential threats that are posed by cybercriminals. Although the surge in AI has created new opportunities and it has introduced new challenges which include the proliferation of unethical practices which can undermine both external as well as internal engagements within fintechs & banks. Hence, it is important to educate & empower customers is crucial. Also, to protect themselves against emerging threats, consumers should be informed about basic tools & practices.

An important strategic approach for organizations is to involve customers actively in the solution making process. Since it is the customers who are the first ones to experience fraud & other cybersecurity issues, their insights are crucial in the decision-making processes. And this is one of the major reasons why part of our advocacy comprises the Philippines’ first industry-led nationwide initiative on cybersecurity and this engages all the stakeholders in a collective effort of raising cybersecurity awareness & education.