World Retail Banking Report 2021: how embedded finance platforms offer new CX
It’s that time of the year: leading consultancy firm Capgemini is releasing its series of reports on the different components of the financial services industry. Today, we have a look at the World Retail Banking Report 2021 – published in collaboration with Efma – which focuses notably on the Banking-as-a-Service model, the internal and external publication of APIs, and on how banks can leverage ecosystem capabilities to unlock new values.
In the report introduction, Anirban Bose (Financial Services Strategic Business Unit CEO & Group Executive Board Member, Capgemini) and John Berry (CEO, Efma), explained that “reshaped distribution models – embedded finance enabled by Banking-as-a-Service and data-driven customized approaches – offer incumbents access to a broader customer base and novel monetization opportunities”.
Open ecosystems create new value streams via Banking-as-a-Service platforms
Nowadays, embedded finance, enabled by BaaS, offers traditional banks access to a large customer base, new data sources, and monetization opportunities.
As explained in the report, “a BaaS approach, strategically defined and powerfully deployed, well supported by the management, and enriched by the right mix of partners and products, is the recipe for maximum benefits”.
Also, a BaaS platform model, powered by a data-centric approach, can help firms champion financial inclusion by modifying offerings and approaches, becoming more accessible and economical for the underbanked/unbanked – all while positioning the business for long-term growth.
The report also highlights that “a robust digital foundation is essential to convert BaaS potential to reality”. The transformation of the banking core will enable operational excellence and insightful management of compliance and customer expectations. To do so, the Capgemini experts underline that banks/financial services should:
- mitigate to the cloud – from IaaS, PaaS, SaaS and BPaaS,
- optimize internal API networks to eliminate silos, sync operations, build plug-and-play capabilities,
- extend APIs externally to power collaborations and push new business frontiers.
How to amplify value? The Banking 4.X WOW factor
According to the Capgemini experts, customers are still frustrated by cross-channel friction, despite bank efforts to deliver an omnichannel experience:
Banking interactions are shapeshifting as customers demand intuitive, integrated, omnichannel experiences that are intelligently personalized and on-demand accessible, anywhere, 24/7”.
To succeed, banks notably need to build an overarching digital and technology-agnostic CX layer, that will offer consistent, secure, and secure experience across the banking ecosystem.
Source: Capgemini