The banking industry across the globe is witnessing a seismic shift towards digitization with cloud as a critical enabler. The story is no different for banks in Australia.
Per reports, approximately 93 percent of Australian consumers have transitioned away from traditional in-branch banking, embracing online transactions. A mere 7 percent of consumers are back to their old ways of banking since the pandemic. The trend is even more pronounced among specific demographics: only 2 percent of Gen Z and 4 percent of young millennials have expressed intentions to conduct transactions in branches. In stark contrast, 13 percent of boomers still prefer traditional banking methods. On a similar note, 89 percent of young millennials possess a mobile wallet, whereas only 35 percent of boomers have adopted this technology for their banking needs.
Shifting Tides
These statistics highlight the significant shift towards digital banking channels, particularly among younger generations in the region. Capitalizing on this evolving trend are an increasing number of non-traditional challengers. These challengers are nimble, agile, and technologically advanced — virtues acquired by embracing cloud. These newcomers leverage cloud-native architectures and data-driven strategies to drive better banking experiences for their customers. Incumbent banks who are yet to undertake digital transformation, are grappling with legacy technology and traditional practices. To become more competitive, these banks must quickly adapt by transitioning to digital platforms and embracing the capabilities offered by cloud.
Using the Cloud to Better Serve Customers
Customers today are exposed to superior digital experiences in all areas of their day-to-day lives and they expect more from their banks too. They want fully personalized and contextual interactions throughout their consumption journey.
With over 90 percent of banking transactions occurring on digital self-service channels, banks have an opportunity to tap into customer data and unearth intelligence. Cloud can help banks transform the customer experience by providing them with a more holistic understanding of their customers.
The Australian Military Bank, one of the most contemporary digital community banks in Australia, upgraded its entire technology stack on SaaS model in under 10 months. The bank witnessed a 250 percent increase in mobile banking transactions in a short time frame since going digital-first. New loans originated per quarter almost doubled and the bank increased its account portfolio by 20% within 6 quarters.
Proliferation of digital transactions present an aspect of the criticality for banks to move to cloud. Banks across the globe handle over 1.9 petabytes of data each day, on average. However, traditional legacy systems were never built to handle volumes of this scale. What’s more, banks currently use only 0.5 percent of available data, highlighting a huge potential for them to unearth business insights. Cloud enables them to manage, and process huge data volumes across multiple sources. Banks can benefit from this seamless and unified data access, decentralized ownerships, real-time interactions, elastic scalability and superior security.
Reaping the Benefits of Cloud for Australian Banks
As banks in Australia accelerate their migration to the cloud, they are poised to reap the many benefits that come along with it, making them better equipped to drive digital transformation, meet customer expectations, and remain competitive in an increasingly digital landscape.
Ultimately, a customer-centric approach, powered by cloud technology, will enable banks to provide personalized services, enhance engagements, and deliver a superior banking experience to their customers.
Finacle provides financial services institutions a secure, resilient, global cloud platform to adapt to the needs of tomorrow. Leading banks across the globe are leveraging Finacle’s digital banking solution suite and reaping the benefits of better customer experiences, business agility, lower total cost of ownership, operational efficiency, and accelerated innovation.
About The Authors
Theo Albers
AVP & Head of Business – ANZ, Infosys Finacle
Theo heads the business for Infosys Finacle for the Australia and New Zealand market, supported by a team comprising of sales, business consulting, pre-sales, delivery and marketing. He comes with a strong technical background, and ample experience in complex multi stakeholder strategic delivery programs. From his many years of experience Theo has good knowledge of banking software functional capabilities, ability to design solution offerings and services to support customers strategic objectives by applying technology to address real world problems.
Arun Krishnan
SVP and Global Head of Engineering, Infosys Finacle
Arun serves as the Vice President, EdgeVerve and Global Head of Engineering, Finacle. He is a veteran with over 25 years of product experience including senior leadership roles in product engineering, pre-sales, support, services delivery, program management, and innovation. Prior to joining Edgeverve, Arun was the Vice President, Product Development at WellDoc Inc, a startup in mobile health. In this position, he was responsible for re-engineering the product organization and was credited with dramatically transforming the capabilities of the company. Earlier, Arun led world-class product organizations in Microsoft and in Bell Labs. He successfully led winning teams in highly competitive and technically complex domains empowering customers and users around the world. He holds a master’s degree in Computer Science from the University of Buffalo, SUNY. Arun is passionate about growing and nurturing organizations to enable sustained innovation.