Banks to Focus on Automation and Cloud in 2023

Banks are attempting to shift more workloads to the cloud. The adoption of AI in banking promotes customer engagement, encourages credit scoring, and protects businesses from fraud.

FREMONT, CA: Financial institutions presently offer a wide variety of digital services like tools for asset management, mobile banking, trading online, and other investment sources. The threat posed by fintech companies on traditional banks by lending out mortgages influenced their decision to be equipped with AI. Legacy banks strive to enhance their clients' digital experiences to keep up with the emerging competition.

The three trends to look for in the financial services industry in 2023 include the following:

Banks Will Double Down on Artificial Intelligence

Artificial intelligence has been making great strides and significantly impacting the financial services industry with its innovative powering recommendation engines and chatbots. It supports client involvement, supports credit scoring, and safeguards organisations from fraud. AI's automated troubleshooting capability, often known as a self-healing infrastructure, automates the production of IT tickets if a mobile banking app goes down.

The analytics component of AI and machine learning is one of the key rationales for investment. AI aids banks in the detection and prevention of fraud. According to 31 per cent of financial services companies, fraud detection for payments and transactions is a priority.

Continuous monitoring aids in company continuity and offers more proactive security checks than postmortem audits. Banks use AI to monitor the location of workloads, whether stored on-premises or in the cloud. When a disaster is declared, the system will immediately contact the appropriate parties at financial institutions to initiate the necessary emergency response measures.

Banks Will Drive New Services with Low-Code, No-Code Solutions

The low-code or no-code approach to application development makes it easier for a nontech professional to use different software. Low-code or no-code solutions are assisting organisations in shifting away from the standard development routine and procedures used in software development for decades to rely more on reusing developer modules and combining them to fit the needs of the business. The concept empowers banks to focus more resources on strategic challenges and risks, including product security.

Permitting financial institutions to repurpose older technology reduces the burden of in-house software engineers. This is especially beneficial for small businesses needing help to retain technical staff and stay up with rapidly evolving technology. With the support of this trend, a business analyst can introduce new powerful applications without the assistance of a software engineer.

More Banks Will Become Cloud-First

Although there are many challenges, banks are attempting to move more of their workloads to the cloud. Consumer, business, small-enterprise deposits, payment processing, and cybersecurity workloads are all shifting to the cloud. Navigating privacy laws, safeguarding information, and putting controls on both bank and customer data will continue to be a difficulty as financial institutions move workloads to the cloud.