Emerging services and solutions amid the COVID-19 chaos
A solution is defined as a means of solving a problem or dealing with a difficult situation. The challenges we have faced with the emergence of the chaos of COVID-19 in the past few weeks are unprecedented.
Financial services are expected to play a pivotal role in helping the global community emerge from this crisis
However, the silver lining is that the solutions that are emerging to overcome these complex situations are unique and innovative. According to United Nations Conference on Trade Development (UNCTAD), the COVID-19 pandemic is likely to cost the global economy between $1 trillion and $2 trillion in 2020 alone.
Financial services are expected to play a pivotal role in helping the global community emerge from this crisis and at the same time the financial services institutions themselves are facing their own industry-specific problems that never appeared in any risk register and therefore didn’t have any mitigation actions against it.
In our experience in the past few weeks, the financial services industry has been facing the following challenges and effects of the COVID-19 situation:
- Alternative and remote working arrangements for the entire workforce
With the impact of social distancing norms, the concept of ‘work from home’ has become the norm. This change in status quo has created challenges around technology infrastructure and the regulatory assurance of ensuring virtual, secure ‘clean’ rooms from where both employees and outsourced contractors can work from.
- Increased digital consumption of financial services products and services
The trend of shrinking branch footprint of banks and financial institutions had already started peaking much before the impact of COVID-19. However, the current situation has increased demand for digital financial services and products exponentially creating challenges around volume handling to spreading the load across different channels.
- Cybercrime and fraud
Increased digital consumption, especially by consumers who are not familiar with transacting on digital channels is a natural opportunity for fraudsters and criminals who are adept at cybercrime. Protecting customers against this trend is an important factor to consider in this chaos.
- Fundamental changes to existing processes
Identity verification and other validation checks across many fundamental processes like account opening, KYC and onboarding, loan disbursement and mortgages will have to undergo a major rehaul with the impact of the social distancing restrictions.
- Cost containment and high pressure on balance sheets in a recessionary environment
As the deeper economic impacts unravel, financial institutions will have to start considering radical cost containment measures. Identifying the right cost containment measure which has minimal revenue impact and high cost impact will be the challenge for the medium-term future.
In the last few weeks, all of us that are addressing the process and technology needs of financial services institutions have come across these challenges and effects in one form or another. Some of the solutions that have emerged to address these challenges are:
- A resiliency services package including BCP Services
An alternative remote working set-up, which includes monitoring, service desk, operations-as-a-service, and regulatory assurance services. We have been helping several of our clients in converting their homes into secured offices with desktops, rental laptops, cameras etc, to equip workspaces at home with office like amenities. This included implementing collaboration platforms to crafting innovative HR policies and communications.
In most cases the solutions were designed by maximising usage of enterprise platforms and tuning essential workflows. These services and solutions, along with nuances that are very specific to financial services, have now emerged as a COVID-19 resiliency services package that will help financial enterprises stabilise and run their operations efficiently.
- Value articulation and return on investment assessment frameworks
While acceleration to provide the products and service offerings of financial services institutions increase, it is important to pick the right initiative to invest in and deliver. This assessment must now be made based on the fast-changing environment. Speed to market to deliver these initiatives has become even more significant. It has become essential to do an immediate review and assessment of the digital programmes along with prioritisation of initiatives that will deliver the most ROI.
This assessment as a packaged service to consider the digital initiatives through the lens of the impact of COVID-19 is another emerging service offering. The assessment will entail a data-driven approach to reprioritise the digital initiatives backlog based on business value, available capacity and capabilities.
- Analytics tools for cost containment
While cost containment measures might need to be executed in the medium-term, data services solutions and BI frameworks, have emerged to identify the right cost containment initiatives considering factors like business continuity planning (BCP) and workforce management. The identification of these initiatives in a scientific and data driven manner needs specific tools and assets that can identify, collate and visually represent them to drive analytical decisions.
Technology and adoption of key solutions within financial institutions are going to play a key role in overcoming the challenges and effects of this unprecedented situation.
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