Technology trends in retail banking to look out for in 2017

2016: a year in which blockchain started to enter mainstream speak in financial services and banks increasingly turned to the cloud.  Many retail banks embraced technologies to personalise the online and in-person banking experience. 

So what are the main technology trends that we expect to drive the retail banking sector in 2017?  Here are my top five:

• Blockchain will start to filter from investment banks to retail banks. Blockchain is not new, with investment banks leading the way in blockchain experimentation for some time now. In the coming year, however, we can expect to see significant trials and proofs of concept (POCs) conducted by large retail banks.  It is possible that some blockchain-powered solutions may even be launched, although mainstream launches are still probably a couple of years away.

• Cloud services will become the new normal. In 2016, we have seen a significant change in attitude as more and more banks have started to fully embrace cloud services, recognising the cost-cutting and agility-improving benefits that they provide.  Some firms have even adopted a ‘cloud of clouds’ strategy that brings together all the distinct, disconnected cloud services under central management, using a single network to manage all data.  I expect to see an increase in the uptake of such services in the coming year, with the cloud becoming the universally accepted new normal.

• New authentication technologies will change the way customers transact with their banks. The use of biometrics has matured over the course of the last year, and will continue to grow as a means of authentication in the year ahead - particularly the use of a ‘blended’ approach, for instance combining finger print and iris scanning.  For example, whilst a bank client wishing to make transactions of up to £500 might be identified using their fingerprint, for larger transactions banks will be able to employ a method combining a finger print and an iris scan.

• The Internet of Things (IoT) will come to banking.  With an ever growing number of data sensors, and with clients becoming increasingly comfortable with the concept of the IoT, banks now find themselves in a position to create highly sophisticated systems never seen before.  For example, the use of IoT will enable banks to streamline mortgage applications by employing data intelligence pertinent to a specific property.  This could include a property’s history of subsidence, flooding, weather patterns, crime history or any other historical data.  Using IoT, banks will be able to develop real time analysis of risk in a specific area, making risk profiling quicker and more personalised.  

• Banks succumb to the ‘Facebook effect’. Consumers have become used to their computers and mobile devices recognising their online shopping and browsing habits, and tailoring the articles and offers they see online as a result.  This trend has now started to unfold in the retail banking space, with banks including Barclays and Lloyds offering data-driven personalised money management tools.  From a purely technological point of view, most personalisation solutions are available and ready to use. In 2017, we will see more and more banks and insurance providers adopt these.

Throughout 2017 and beyond, we’ll see the whole retail banking sector continue to undergo a technology and customer lead revolution, which can only be good for us all as consumers.