Banks, credit unions, and other financial institutions are using more technology to improve customer experience and create a leading edge. As a result, in-house IT resources have more on their plate. IT teams are pulled away from innovation and development to take care of basic IT infrastructure and data management. The solution to this problem is outsourced IT.
By outsourcing, third-party experts take care of day-to-day yet critical tasks such as support, network services, and data protection. This frees up IT teams to spend time on new and more significant priorities. Enabling increased efficiencies and a renewed focus on business growth.
How technology is changing the financial industry
Banks have to adopt innovations and digitally transform to stay competitive. There are a couple of reasons for this.
- One – the rise of fintech. New, disruptive companies ranging from online lenders and crowdfunding platforms to stock-trading apps are changing the playing field. From 2018 to 2020, 8,775 fintech startups entered the market in the Americas. They offer customers seamless experiences and lower-cost alternatives through digital, mobile, blockchain, and cloud technology.
- Two – the entrance of tech giants into financial services. Apple, Facebook, and Google all have their own consumer payment solutions with Apple Pay, Facebook Pay, and Google Pay. Amazon, PayPal, and Uber have expanded their suite of services to include lending, and all are already gobbling up market share. For example, Amazon Lending lent an estimated $1 billion in 2018. PayPal issues over $1 billion in working capital loans every quarter. Uber Money offers drivers a bank account, debit card, and mobile banking app. They are also working on a financial wellness app that will allow drivers to automatically save a portion of each trip payment.
With more options on the market, consumers have become accustomed to making payments, saving, investing, and more. All with ultra-convenience, enhanced personalization, and lower fees. Banks that are still behind technologically and offer poor IT performance aren’t able to deliver the kind of experience most consumers today expect. This can lead to a loss in customers and revenue.
How an outsourced IT team can help
With outsourced IT, banks can do more with their technology and improve customer experience. Over the long run, this can help them retain customers, reduce expenses, and adapt to an ever-evolving landscape. Through outsourcing, banks can:
Control and reduce IT costs
Instead of hiring new IT employees, financial institutions can save money and only pay a predictable service fee for managed IT and consulting services. This also gives them access to a range of IT specialists, including cybersecurity and data management experts.
Focus on the business of running the bank
Banks that outsource IT benefit from having a reliable team of experts on hand. This means employees can get fast responses to their IT issues, helping them to stay productive. With a well-managed IT infrastructure and network, there will be fewer IT headaches, such as downed servers, software glitches, and other problems that can lead to downtime and lost business.
Stay current with the latest technology
When you outsource, your IT team can work on business-critical tasks such as mobile app development. Use your in-house resources to create a better customer experience and ensure your bank is on the cutting-edge when it comes to mobile banking, digital payments, and other services to benefit your customers.
With a digital-first banking model, financial institutions face new challenges in keeping data secure and maintaining compliance. This is another reason why outsourced IT resources can be invaluable to banks today. Your IT partner can help with everything from network monitoring to creating robust cybersecurity and data recovery strategy that aligns with your needs.
Find out more about how outsourcing IT can help your financial services firm thrive in today’s tech-driven environment.