Financial services sector is least likely to prioritise digital transformation

Although banks and other financial services (FS) providers are striving to remodel their services and operations to compete with fintechs and other digital-first challengers, the research found that the industry is lagging behind other sectors in key areas such as security and investment in employee training.

The research polled business leaders and decision-makers in government, financial services, retail, healthcare, transport and logistics, and found that 34 per cent of financial firms say they are prioritising digital transformation in the next 12 months – the lowest of any industry.

Despite leading other industries in cloud migration, FS businesses are the least likely to harness the power of cloud native applications, with barely half (52 per cent) planning to invest in this area over the next 12 months – compared to 68 per cent across other industries. Financial firms are also least likely to invest in identity management systems, with just 56 per cent identifying this as a priority compared to an average of 65 per cent.

“In recent years the world of finance has been transformed by a large number of challengers who provide a range of services through digital and mobile,” said Tom Holliday, Financial Services Consultant at KCOM. “Traditional FS businesses are playing catch-up as they seek to deliver great services and user experiences, while also ensuring that they continue to protect customer data.

“Our research shows that financial businesses are failing to give digital transformation the required priority. Cloud native applications are crucial for delivering a seamless, high performance experience for customers, yet FS businesses are the least likely to prioritise them for investment. We are also surprised by the low value given to identity management systems, which are so important for authenticating customers – another key area as the sector shifts to new service delivery models such as mobile.”