There are various challenges facing the banking industry in 2020. Discuss them and bring to your discussion how the covid-19 crisis will come on top of the pre-crisis challenges. (Essay type question, please provide many points min. 500 words)

ANSWER

Challenges in Banking Industry IN 2020

The banking sector goes through a drastic shift, driven by rising competition from Fin-techs, disruptive technologies, changing business models, and mounting regulation and compliance pressures. However, the rise in data breaches, changing regulatory and compliance requirements, and privacy policies have posed several challenges for the banking system .

Let us check out the challenges facing the banking industry:

1.Increasing Competition

The growing prominence Fin-techs have posed a threat, targeting a number of the foremost profitable financial services areas. Goldman Sachs predicted that these startups would account for quite $4.7 trillion in annual revenue diverted from traditional financial services companies.

2.Customer Retention

Financial services customers expect meaningful and personalized experiences through simple interfaces on any device, at any time, and anywhere. Although customer experience are often hard to live , customer turnover is tangible. Banks can win customer’s trust and loyalty by knowing their customer and their expectations. Also, implementing an ongoing client-centric approach might help.

3.Changing Expectations

Today’s consumer is smarter, tech-savvy, and more informed than ever before. They expect a sort of banking experience that’s tailor-made and convenient. Changing customer demographics play a big role in these heightened expectations. Today’s generation has an innate understanding of technology. As a result, banks are striving to enhance digitized experiences. Millennials have accelerated the charge to digitization. Hence, the utilization of mobile banking has increased dramatically.