Cloud is the great disrupter. Understanding cloud technology gives companies an edge when it comes to innovation, exploration, and technology development. Meanwhile, financial institutions are often hailed as the last bastions of tradition. Cumbersome, counterintuittive processes and ancient customer policies remain common, even as users desert physical banks in droves to tap mobile and online solutions.
As noted by Shopify, 44 percent of consumers now use mobile digital payment solutions, while 40 percent pay bills, 45 percent transfer money, and 67 percent want to see new digital payment options. These numbers trend even higher among millennials. However, it's not all bad news for finance, with 62 percent of customers saying they prefer to interact with their banks via mobile.
Financial companies have been compelled to embrace enterprise cloud solutions and move beyond traditional offerings to satisfy customers and expand into everyday life.
Ultimately, the ubiquity and resource availability of the cloud has forced the hand of financial institutions. Competing on a global scale was no longer possible using in-house servers and highly controlled endpoints. Users demanded speed and convenience only the cloud could deliver. Major banks now leverage some form of the cloud to increase overall flexibility, provide resource scaling, and limit risk through redundancy.
When it comes to understanding cloud technology, this is entry-level stuff. Processes are more agile, and they can easily ramp up or down. Banks fought hard against this type of shift, but just like insurance, healthcare, and government, they ultimately lost the argument in the face of overwhelming public demand. Never underestimate citizens armed with smartphones.
The 'E' Drop
The shift to online banking came next. It wasn't enough just to have a better back end — customers demanded anytime, anywhere accessibility from online portals. This got off the ground with "e-business" units designed to ride out e-commerce interest, but when the fad turned into a reliable future, the "e" dropped off and everyone just started calling it "business."
Now, new data sources will provide unprecedented access to customer intelligence, while efforts at automation will empower reshoring as consumers demand better local support. And none of it happens without the cloud. Automation and data collection at this scale are an IT disaster waiting to happen if companies don't have the right cloud backbones in place.
Banks now face a new challenge in understanding cloud technology: integrating their products and services into the everyday lives of consumers. Take a look at the current crop of mobile banking apps. You'll see that most go beyond just "pay bills" and "make transfers" to include value-added features such as budget trackers, spending calculators, and a host of advice options clients can leverage to spend more money with their banks and ideally get more value.
However, there's still room for improved functions such as the ability to open accounts online or apply for personal loans without having to make an in-person appearance. And since banks already have virtually every detail of consumers' personal and financial lives on file, it only makes sense to leverage this data for predictive saving and investment purposes combined with easy-to-access expert advice.
And it's not just banks — according to Recode, the future of modern vehicles is digital as manufacturers rely on the cloud to empower in-car solutions such as Wi-Fi, music streaming apps, and predictive maintenance programs. Meanwhile, dealerships and service staff are leveraging collected data to predict repair needs and sell customers new cars as soon as possible after OEM warranties run out.
Talking the Talk
So, where do financial firms, car manufacturers, and other disrupted industries go from here? They leverage cloud-based APIs to streamline service delivery. For example, verification APIs can ensure customers are who they say they are and protect companies from backlash if unapproved users gain access. Cloud-empowered phone number APIs can help gather real-time insight on any device tapping a company's apps. And don't forget the rise of live support and loyalty incentives: Consumers want to know that companies value their business. The right chat API can ensure organizations have the flexibility to provide immediate support and supply tailored offers, discounts, or services.
Understanding the cloud for finance and other industries goes like this: First, it's disruptive, so you don't want it. Then, you realize it's worthwhile for speed. Next, you realize you must have it for maximum impact. And now you know it's absolutely essential to empower APIs.
Are you ready to conquer the cloud? Connect with a Vonage Business representative.