How Has COVID Changed the Digital Landscape for Financial Companies?
In June, there was a virtual meeting held by the Bank Governance Leadership Network in order to discuss the response to the coronavirus pandemic from banks and other financial companies. The discussion focused on three main points:
- The new risks that emerge with digital transformation
- The fact the persistent uncertainty continues to be a challenge for forecasting
- The test that banking models and the reputations of banks will face.
This article will discuss these new changes that have been brought on by covid, specifically, how the pandemic has changed the digital landscape for financial companies.
The New Risks with Digital Transformation
Like industries across the UK, banks had to adapt in order to continue to offer services for their customers. This meant moving their tools, processes and services onto the internet. Technology has been one of the saving graces of the entire pandemic as people have been able to order food online, buy goods and have meetings, the same can be said for financial companies. Banks have been utilising advancements in tech in order to overcome the challenges that covid came rife with.
There are lots of experts who believe that the digital transformation will have a lasting effect, even after lockdown eases and restrictions are dropped. Before the pandemic, all banks had some kind of financial system involved; however, the pandemic acted as a catalyst for organisations to excel their technological programs, so they were much more streamlined and efficient. As such, there are a lot of experts who have viewed the pandemic as an opportunity for further investment in technology in banking.
Of course, with these technological advancements comes the difficult task of balancing how banks deal with threats using such a new system. There were many different scams throughout covid such as criminal cyber activity, fraud and phishing attacks. So, how do banks protect against these if they are not operating in normal circumstances? Boards have agreed they need to continually assess new emerging risks.
Uncertainty is Challenging Forecasting
The government took unprecedented steps in order to combat the negative effects of the pandemic, which included an increased amount of lending so that businesses could receive money in lieu of an income. Of course, even now as lockdown eases, with cases rising, the future remains uncertain. It is that uncertainty in the global economy that proves a challenge for banks as they attempt to model the impact of the pandemic on their customers and portfolios.
Given the amount of time the pandemic has been going on for now, the economic impacts of it have become much clearer and as a result, banks are able to update their risk models in order to stay ahead of the curve. That being said, nothing in the current climate is certain, and as such this continues to pose challenges.
The Testing of Current Banking Models and Reputation
Systems that have proven successful in the past, due to the new systems that are in place across the country, may not prove to be successful from now on. Not to mention, as government lending schemes slowly come to an end, it could be the case that the financial repercussions of coronavirus begin to hit customers and as such they will need to adapt to this.
As lending ends, banks will need to handle the collection process and will be dealing with distressed and frustrated customers in the process, which presents a huge risk for lenders. A company’s balance sheet will be askew due to the impact of covid and so they will need time to get these back to normal as they recover from the pandemic.
Due to the inevitable impact that the pandemic will have on individuals, the strain on banks repossession and collection systems will be huge. Banks, as a result, are considering a potential extended recessionary period, whilst trying to explore ways that could enhance customer wellness assessments.
How Will Marketing for Financial Companies Be Affected?
The main thing that customers are looking for currently is knowledge and certainty. Granted, to be certain about anything at the moment is a dangerous move but the fact is, any customer looking to a bank or a finance company for advice will expect to be met with an expert voice.
Marketing in such uncertain times needs to ensure it is instilling confidence in the customer. It could prove hard to convey this feeling and as such, it means financial and financial technology companies should look into utilising the help of Global Performance Marketing Agencies.
A prime example of a marketing company who would be worth contacting for such help is YouYaa. YouYaa are a Global Performance Marketing Agency who specialise in digital marketing and work with a number of different financial companies. Organisations such as YouYaa are experts when it comes to designing posts and sites in a way that instils confidence in potential customers.
In the wake of the coronavirus pandemic, it’s no surprise that so many different sectors are struggling to adjust to the changes that come with a global pandemic. The financial industry is no different as companies have had to adjust as offices have closed and moved online. With this comes an increased risk to security, bank projections being difficult and previous systems not working as effectively as they could do.
As such, the way that financial and financial technology companies’ market themselves has to change in that it needs to keep the public updated constantly on these potential issues, whilst also staying cautious about these uncertainties. It will likely be difficult for financial technology companies to do this kind of marketing and as such, they will likely need assistance from professional marketing agencies such as YouYaa.