Digital banking: Tapping the power of cloud to empower financial institutions

Rajashekara Maiya, vice-president, global head – Business Consulting, Infosys Finacle

By Srinath Srinivasan

The dependence on digital financial services during the Covid-19 pandemic has led the BFSI segment to accelerate the digital transformation process. In the coming days, more enterprises, small, medium and large, are expected to come into the ambit of digital financial services forcing financial institutions and fintech companies to prepare for the inevitable demand explosion.

“Leveraging advanced technologies such as deep analytics and machine learning will empower banks with a more sound understanding of customers and their preferences,” says Rajashekara Maiya, vice-president, global head – Business Consulting, Infosys Finacle. “Learning from the past interactions with the end-user and their actions, banks can build adaptive solutions and drive contextual engagements.” Finacle is a core banking product developed by Infosys that provides universal digital banking functionality to banks.

Today Maiya and his team focus on helping banks build new business designs to bridge the divide between the digital and physical worlds and embed banking into their business processes seamlessly. This includes comprehensive digitisation of businesses through the full stack modernisation of digital engines, engagement and experiences systems, powering digital-only banks, supporting a bank-in-a-bank strategy where incumbent players are setting up distinct digital entities, helping fintechs offer banking services (for example, PayTM), helping non-financial institutions (such as India Post) to offer banking products, aiding multiple telcos who are launching banking services, and even an insurance company.

In order to provide digital transformation, Finacle has invested in cloud native offerings, co-innovating with seven clients to create a pilot blockchain based network to process trade finance transactions, expanding coverage for RESTful APIs to enable ease of collaboration with customers, partners and fintechs, co-innovating with large and fintech partners, embedding advanced analytics and AI in its solution suite, and leveraging Robotic Process Automation and cognitive automation.

The cloud native digital solution suite helps traditional (ING, DBS, Emirates NBD) and emerging financial institutions (Marcus by Goldman Sachs, Digi bank by DBS, Paytm) address digital engagement, omnichannel banking, origination, digital product development (core banking, payments, cash management, wealth management), analytics, artificial intelligence, and blockchain requirements of financial institutions to drive business excellence. According to Maiya, banks in over 100 countries rely on Finacle to service more than a billion consumers and 1.3 billion accounts.

Finacle is also doubling down on the current opportunities to implement blockchain. “Banking industry is expected to account for 30% of total blockchain spending through 2023, if not beyond,” says Maiya. Finacle has launched several deep domain solutions in partnership with banks including Remittances, Payments, KYC, Trade Finance, Digital identity management. “More than 17 banks are part of our network and actively piloting the solutions we provide. The key differentiator for our solutions is that these are built in a ledger agnostic manner and can work on any major blockchain technology, for example, Corda, Ethereum, Bitcoin or Hyperledger,” he says.

Are bank employees ready for these new technologies? “Banks will do well in setting up multidisciplinary programmes to maintain their talent pipeline,” says Maiya. “They will need to map competencies across functions to identify skill gaps and bridge those employing a combination of tools, technological enablers, and on-demand contextual learning platforms.” He predicts business process synergies between the workforce and machines will gain momentum.

With new technologies comes the ability of institutions to handle cybersecurity. “Mission-critical infrastructure tests, remote defense capabilities, centralised user administration, transaction authorisations, best practices for remote and secure working, AI, and other technology augmented fraud management techniques will be some of the key trends banks will prioritise,” says Maiya.