Bimodal banking – the best of both worlds

European Voices4 minutes readOct 7th, 2016

Keeping the lights on, keeping the costs down

The first strand of bimodal IT is, broadly speaking, concerned with “keeping the lights on”. Which is to say, ensuring the stability of the key IT infrastructure and processes that are the bedrock of any financial institution’s business.

There are many forms that this can take. Stabilisation projects that guarantee the efficient and safe running of mission-critical core banking services. Modernising applications so maintenance time is minimised. Offshoring functions to third parties that can perform them at an industrial scale. Moving processes to the cloud so they are faster, more scalable and have a more predictable cost to the business.

This mode of IT is a no-brainer for most financial institutions because of the efficiencies and cost-savings created for the business. Not to mention that many stability-focused IT projects of this mould will concentrate on ensuring regulatory compliance of all services and process. Indeed, many off-the-shelf technology solutions for the financial services sector allow the measurement and management of risk and regulations.

There is also a need for the stable mode of IT to tackle increasingly complex cybersecurity challenges. The recent abuse of the SWIFT system by hackers is a tough lesson that the systems that form the bedrock of the financial services industry must be regularly assessed for the strength of their security. It must not be forgotten that keeping the lights on must necessarily involve keeping systems and processes secure.

In all of these ways, ensuring the stability of core processes benefits customers too, as it improves the quality, speed and safety of the financial services they consume.

Innovating to meet changing customer expectations

The other speed of bimodal IT involves exploiting the innovative potential of new technologies to drive growth in the business and greater engagement with customers.

Customers have more technology at their fingertips than ever before, and they expect to be able to interact with financial institutions through any digital means at their disposal. We have already seen this with the rise of mobile banking apps; many customers expect to be able to carry out online banking without a desktop computer.

Financial institutions must invest in new innovate technologies to meet the evolving needs and expectations of their customers. For example, biometric authentication measures such as fingerprint scanning could possibly replace the physical fobs and code generators that many customers find inconvenient. In fact, Unisys recently partnered with BehavioSec to produce a prototype for Nationwide’s mobile banking app that recognises how users hold, swipe or type into their phone – and uses that as an authentication method.

Customers no longer wishing to wait on hold to a customer service operative could have their queries answered immediately by AI bots. There are even institutions that have built technology allowing millennial customers to authenticate log-ins with emojis should a lender chose to engage this demographic.

Investing in these kinds of technological innovations will not only provide financial institutions with powerful news ways to interact with their customers, they will provide crucial points of differentiation in an increasingly competitive market. Using predictive analytics and customer social media to pre-approve transactions and applications, for example, could be a hugely attractive proposition to a potential customer.

Balancing the books

Both aspects of bimodal IT – the stable and the exploratory – are crucial for financial institutions to remain competitive. Ensuring the predictability of core IT processes will allow institutions to reduce costs and deliver better services to customers in a more efficient way. Capitalising on innovative technologies will allow financial institutions to find new ways to engage with customers, providing them with the services they need in the manner to which they are accustomed. It is the organisation that manages the balance these two modes of IT that will find success, now and in the future.

Tags-   banking BehavioSec bimodal