The recent Cornerstone Advisors' report is more than an annual summary; it's a compass for navigating the banking sector's shifting tides. Its purpose is clear: to aid financial institutions and their tech partners in grasping the pulse of the industry and preparing for the waves of change. This resonates deeply with those of us who are entrenched in these waters. AIS, with its expertise in process automation and operational efficiency, is particularly well-positioned to address these challenges. As a strategic partner, AIS provides the technological innovation and specialized talent that banks need to thrive in this evolving landscape.
The Current Landscape:
Amidst economic volatility and the push towards digital imperatives, the Cornerstone report highlights the mounting challenges within the banking environment. Mid-market banks and credit unions, in particular, face intensified market pressures, finding themselves increasingly edged out—a concern poignantly noted in the report. It’s here that AIS's proficiency in back-office operational support becomes invaluable, offering agility and strategic foresight through managed services and process automation. These tools are key for financial institutions aiming to rein in non-interest expenses, which according to the Cornerstone survey, is a “Top Concern” for bank executives in 2024. So much so, the focus on bank efficiency and costs rose 25% from last year’s responses.
Leveraging Technology and Expertise:
When asked “What are your institution’s three most important efficiency and cost savings priorities?”, the top three executive responses continued to be:
However, the priority that showed the most growth from the 2023 survey was “Reduce headcount (Up 10& year-over-year).” In this context, AIS’s contributions can be pivotal; we proactively seek and implement robotic process automation (RPA) in the back offices of banks that yield significant efficiency gains. Our banking domain specialists extend operational capabilities for up to 50% of the average costs of running bank operations. This blend of technology and cost-friendly talent not only streamlines operations but also directly addresses the rising concerns and opportunities identified in the report.
Driving Efficiency and Quality:
As we've observed, process automation is not merely a trend but an evolutionary step for banks striving to improve efficiency ratios. With RPA investments on the rise, AIS is helping clients harness this technology to accelerate processes, not as a replacement for human staff, but as a catalyst for enhancing human productivity and creativity.
Balancing “Legacy” with “New Age”:
The Cornerstone report underscores a crucial aspect of the banking sector's journey: the challenge of balancing legacy systems with the drive for digital innovation. Many banks grapple with outdated infrastructure that, while reliable, hampers their ability to compete in a rapidly evolving digital landscape. AIS recognizes this critical challenge, offering solutions that bridge the gap between legacy operations and modern technological demands. Through our expertise in placing new technologies on top of existing systems, we facilitate a smooth transition that respects the past while embracing the future, ensuring that banks can innovate without disrupting their core activities.
Strengthening Fintech Partnerships:
Fintech partnerships have long been pivotal for banks, with their importance continuing into 2024. While the Cornerstone report indicates a slight shift, with the view of these partnerships as a strong growth driver decreasing, the overall reliance on them remains robust, increasing from 68% to 70% when considering both strong and moderate growth perspectives. This nuanced change suggests a more mature, integrated approach to fintech collaborations, moving beyond mere growth facilitation to strategic integration.
AIS recognizes the evolving nature of these partnerships. Our expertise not only supports banks in establishing and nurturing these fintech relationships but also ensures that such collaborations are deeply integrated into the banks' operational fabric, driving innovation and efficiency. With AIS, banks can leverage these partnerships to not just chase growth but to strategically enhance their service offerings, operational efficiency, and market competitiveness.
Operational Agility:
"The evolution from 'digital transformation' to continual evolution," as Chief Digital Officer Brian Alfano of OCCU suggests, "captures the spirit of the banking sector's journey." Embracing this paradigm, AIS propels banks beyond mere digital transformation to a state of perpetual evolution through its unique blend of tech and talent. Our managed services and strategic insights equip banks with the agility to swiftly respond to market changes and regulatory demands. This agility empowers banks to not just react to the present but also proactively shape their future, staying ahead in a competitive and ever-changing sector.
Conclusion:
The insights from the Cornerstone report paint a vivid picture of a banking sector at the cusp of significant transformation. In this new banking era, the need for operational efficiency and , technological integration in a bank’s back office has never been more critical. AIS stands at the forefront of this transformation, empowering banks with the tools and expertise to reduce operating expense and improve bank efficiency. With AIS, banks gain a partner committed to their growth and success in an ever-evolving financial landscape.
Let's turn insights into action. Connect with AIS to explore how we can accelerate your bank’s journey through tailored technology solutions and specialized talent, designed to meet the evolving demands of the modern banking landscape.