Despite the challenges and disruptions of COVID-19, the financial services industry (FSI) in Asia Pacific has continued to forge ahead and accelerate the pace of digitisation in response to the pandemic, according to latest findings from Microsoft and IDC.
The study found that more than three in every five (66%) FSI organisations are accelerating digitisation of their businesses. This figure rises to 86% amongst “FSI Leaders” or organisations who have the most mature culture of innovation, defining their ability to drive sustained innovation.
Findings are based on the survey of 597 regional business decision makers in FSI across 15 markets in the region, conducted within a six-month period before and since COVID-19.
The sector was found to be ahead in its ability to innovate in response to challenges, with 70% of all FSI organisations saying that innovation is now a “must” and almost all FSI Leaders (96%) agree and are actively putting this into practice.
“The industry’s rapid response, reflected in the increase of maturity in adopting a culture of innovation, across people, process, technology and data practices, has paid dividends,” said Connie Leung, regional business lead for financial services at Microsoft Asia.
“FSI Leaders, in particular, expect to thrive amid the crisis, with 53% of them expecting to increase their market share despite the pandemic and 86% further accelerating digitisation in response to the crisis,” said Leung.
She said this was taking shape within the industry, with organisations like Bankwest investing in self-service solutions to improve the customer experience at a time where customers are expecting meaningful connection despite social distancing.
Apart from relying on innovation, the study also revealed that FSI organisations are deriving high revenue shares from digital products and services. This stands at 39% currently and is forecast to rise to 52% in three years.
This is much more so for FSI leaders, where this stands at 47% today and expected to rise to 57% in three years.
This is evident in the examples of Indian fintech start-up, Paisabazaar, which introduced a new digital service to digitally overhaul the personal loan application and approval process amid the pandemic.
Also, banking groups like Standard Chartered Bank and National Australia Bank have taken steps toward a cloud-first digital strategy, to make virtual banking, next-generation banking and payment services a reality for customers.
Further, the study revealed the best practices that organisations can adopt, referencing the culture of innovation framework, for progress across people, process, data, and technology.
Organisations are encouraged to leverage platforms to drive transformation move mission-critical business processes and workloads onto cloud platforms and to ensure that technology architecture are well-integrated to effectively enable transformation.