How insurance and banking strategy is affected by digital
The age of digital transformation has swept every industry in its stride over the last two decades, and the story of the banking and insurance sector is no different.
BFSI companies have evolved from their traditional ways of operations and come a long way to adapt to the digital era. From their early days of creating a web presence to the present day of offering a unique seamless customer experience on multiple channels, the sector has witnessed epic digital transformation.
Into BFSI’s digital journey
Customer centricity has played a pivotal role for BFSI sector in acclimating to digitisation. Changing consumer behaviors served as a key to novel technological innovations and has led to a game-changing metamorphosis in the history of BFSI, marked by distinct milestones.
The dawn of digitisation
Digitisation entered the BFSI industry more than two decades ago when most of the operations were manual. Introducing ERP systems in the industry opened a gateway to the digital world. BFSI companies started leveraging the benefits of ERP and created a system of records. Further, the implementation of ERP and custom solutions allowed them to gain centralised control over their data and operations.
Stretching beyond (Expansion of records)
Technological implementations worked as super catalysts in managing their records better. So, the next step was to stretch beyond into expansion of records. This phase of IT solutions implementation was more focused on managing the records of internal and external customers. Solutions like CRM, CBS, LMS, etc. paved the way to creating and managing systems of records for customers, employees, external agents, call centers, etc.
The DIY power
The next innovation wave was a significant leap in the sector that changed customer interactions with companies. Launching customer portals and mobile apps empowered customers to take charge of their transactions. This phase saw the rise of internet and mobile banking and a gradual drop in in-person banking.
The STP Era
The STP (Straight-Through Processing) era has been one of the prominent milestones in the BFSI industry. STP made all the payment transactions, from initiation to final settlement, automated electronic process, without any human intervention. It transformed the way banks and insurance companies send and receive money.
Collaboration
With time, the BFSI industry eventually evolved and saw the rise of IT-enabled service-oriented companies like Policy Bazaar, Bank Bazaar, etc.
Given the magnitude of visibility and customer data they generated, banks and insurance companies needed to collaborate. And technology made it possible. Systems were aggregated and integrated for the exchange of required information. This collaboration of systems worked as partnered interfaces and welcomed new leads.
The API age
Digital communication in BFSI sector has grown from mere interactions and transactions to creating seamless customer experience today.
Solutions like AEM are creating ripples to create and deliver such cohesive and seamless experiences on multiple touchpoints. And Application Programming Interfaces (APIs) are playing viaducts in these endeavors. APIs are allowing BFSI companies to integrate different systems like mobile apps, chatbots, and databases so they can exchange information smoothly.
This is the modern-day Age of API – an Open Era where internal and external systems freely communicate with each other with the help of APIs. API is mainstream today, which has outlined an important landmark in the IT evolution of BFSI.