Author: Winsoft Technologies

One sector that has witnessed drastic transformation is undoubted- the banking sector. And the key catalyst in the role is technology. Digital transformation has pushed the banking sector to a whole new next level; digitalization is here to stay but the need for physical branches will continue to be relevant for consumers. There are certain scenarios where users prefer going to banks physically. So, considering the changing behavior of new-age customers banks should offer digital as well as physical services to its customer to deliver an exceptional customer experience. One such approach banks can adopt for maximizing the benefits of physical branch and digital abilities is in the shape of Phygital Banking.

Let’s dig deeper to know more about the new way of banking- Phygital

First, what is Phygital Banking?

The word Phygital is coined by combining the two words i.e. Physical and Digital. Simply put, Phygital banking is a type of banking where physical branches reap the advantage of digitalization across various channels. In this disruptive model, both humans and technology are employed to serve the customers.

The retail sector has embraced the Phygital ecosystem i.e. At Amazon Go supermarket, customers go physically to check products and make payments via smartphone.

So, Why is Phygital Banking Required?

As the pandemic has standstill our life but after vaccination life is coming back to normalcy. Due to the global pandemic, people choose the digital landscape for the transaction and it has led to a surge in usage of digital banking. Covid-19 has accelerated the Phygital experience for customers. And their expectations are changing quickly as they want seamless and unmatched Phygital banking.

With that being said even the new age customers are also reluctant to put their hard-earned money on a completely digital bank with no physical branches. So, the bank should equip themselves to offer digital customers some real-time solutions for their issues.

According to Fintech Magazine, a Barclays report quoted that 46% of Gen Z customers surveyed said they would visit the physical branch to explore more products or services before investing or making a purchase. These data suggest that for a customer both physical and digital elements are imperative. In the physical environment, they can discuss the products and services and later digitally they can purchase them.

Additionally, the banking system with digital capabilities such as biometrics, APIs, machine learning, and other business aspects can abet a bank to transform its physical difficulties into Phygital chance. Not to mention, with the Phygital approach a bank not only gains a competitive edge over brick-and-mortar banks but also against digital competitors.

Here Are Some Ultimate Advantages Of Phygital Banking

1. Enhances Customer Experiences

   The new-age customer wants a quick and instant process, no matter if it’s digital or physical. Furthermore, Phygital banking examples proffers such feasible solutions to them. They can easily choose the option to engage with the banks to avail services such as voice calls with digital bankers or using digital services to solve their queries.

2. At Par Customer Satisfaction

   Banks have those customers also who aren’t able to use digitalization so for them Phygital banking has the solution. They can visit the physical branch to get the queries solved; the bank can educate them on digital facilities also. This way it leads to higher customer satisfaction.

3. Cost-Effective

   

   Another astounding advantage of Phygital banking is it abets in reducing overhead costs and amplifies customer value. Moreover, numerous repetitive tasks including both backend and frontend have been automated by the Phygital banking approach. Besides this, the time required for processing documents or issuing cards, and opening a bank account has been reduced by this mode of banking.

4. Access To Vast Customer Base

   People in rural areas are still reluctant for digital banking; the reason could be a lack of authentic and correct knowledge. However, the best-fitted solution in this scenario is Phygital banking. To add, globally open banking regulation is being discussed for banks to be more secure, reliable, and most importantly transparent. With Phygital banking, the banking space is connected with a wider audience, helping the banks connect with the right prospective customer giving them the right banking products.

5. Bank Customer Association Is Improved

   Phygital banking offers a solution to the customer at both the physical as well as digital levels. This facility abets in strengthening the relationship with the customers. Bank branches create a sense of trust among the customers whereas digital services offer a fast resolution to their queries, this enhances customer experience.

Conclusion

The advantages of Phygital banking are strong and cogent. It could be the most accepted and secure mode of banking for customers of every generation. Banks are required to leverage the trust of the physical branch and the power of digital transformation. Any bank that mingles both the services in the correct manner could create future-ready banks along with saving costs, the scale at a fast pace, integrate a customer-centric approach, and competitive edge.

To put it simply: the concept of Phygital banking is capable of furnishing a plethora of benefits to its congregating users including enhancing customer experiences, bestowing customer satisfaction, access to a wider market, improving the customer-bank relationship and so on. This is why; the modality is often considered the future of banking and is likely to dominate the contemporary market.

In the last few years, the wealth management industry has witnessed a paradigm shift i.e., millennial’s participating in the wealth wagon, changing customer expectations, and most importantly digitalization. Additionally, the equity market went to new heights in 2021, alluring first-time investors; approx. 14.3 million new Demat account opening in 2021 validates the wealth management soaring highs.

With that said the new- age investors are more informed and tech-savvy along with having access to the pool of knowledge and expertise. They plan their finances, think differently, and act with different attitudes as compared to old investors. So, wealth management firms need to amplify their digital transformation journey along with paying equal heed to cybersecurity, digital currency, customer-centric approach, and the Internet of Things (IoT) to give its customer a superior experience.

Let’s delve deeper to know top wealth tech trends 2022 to watch out.

• Digital Assets

  Cryptocurrency alias digital currency since its launch has become widely popular among the millennial generation and their preferred form of investment. First official cryptocurrency – Bitcoin has reached a record new height of $69000 with other coins such as Ripple and Doge witnessing the surge in popularity. Countries around the globe are slowly accepting and adapting to this digital asset. Plus, there has been an upward trend in CBDC (Central Bank Digital Currencies). So, this wealth tech trend is here to stay! Wealth management firm needs to provide innovative ways to the customer for crypto investment, by leveraging the power of Blockchains.

• Virtual Advisory Tools

  Indisputably, with each passing day, we are persistently moving towards the path of being digital. Experiencing it every day in the shape of remote access, online shopping, watching entertainment content, or even taking doctor’s assistance virtually with telemedicine are some of the perfect examples. To put it simply: every aspect of our lives can be readily overseen digitally or virtually today. All thanks to the incessant progression in technology that has played a significant role in making this world a better place to thrive.In continuation; since our dependency on digital or virtual assistance is immensely soaring, including financial life in the same list is not wrong. The explosive growth of fintech has led to the emergence of an eclectic range of exciting technologies. Their ultimate aim is to enhance the existing ways of delivering services by embracing the strategy of automation. All this is done with the succoring of virtual advisory tools that have been in a trend ever since their virtues came into lime-light. From banking to mortgages to insurance, digital technology has ensured a seamless experience between financial advisors and their clients. The volume of solace this approach provides is worth applauding. Investors are highly persuaded by the concept of remote technologies. That’s why; they prefer engaging with a live financial advisor virtually while sitting at the convenience of their households.

• API Deployment

  To many APIs may appear as a broad term about which they might have heard at some part of their lives. However, it’s deeper deets they might not be wary of.Throwing light on this modality; an API sets the path for two divergent technology applications to communicate to each other and furnishes the provision of data sharing. This abets to better the overall user experience and value of both.

  One of the ultimate benefits of API is; by integrating this methodology, financial advisors get empowered to subsume data from additional client accounts into several prevailing financial planning portals. From here, the professionals could communicate with clients effectively to better their experience.

• Customer-Centric Technology Approach

  Any sort of technology implemented should fundamentally focus on delivering a superior customer experience. Irrespective of the industry, a similar approach is the imperative need of the hour. The same is applicable in wealth management also. If your patrons are getting impeccable services, they won’t hesitate to throw open their wallets in the future too. In the case of dilapidated services, the clients have several options to choose from.

  

  This is why; the rapid and ongoing digitalization has helped in the development of several strategies with an aim to personalize client experience. The previous old-school approaches of in-person assistance by financial advisors have seen a relentless decline. What’s more, contemporarily more and more people are realizing the virtues of seeking online help. Many of them have their individual social media accounts. They don’t mind posting their queries through these online channels. Therefore, wealth management companies should look to invest in employing digital marketing strategies for an effective customer-centric technology approach.

• Internet of Things (IoT) and AI

  When it comes to IoT, it principally describes the vast universe of embedded sensors that help in efficacious communication between consumers and companies through the internet. Its vogue has seen a climb in the last few years, especially in the wealth management sector.To comprehend the inside deets on how IoT and AI are beneficial in wealth management; these modalities enable enterprises to analyze client and market data to envision specific patterns. As an instance, analytics engines could examine a client’s bank account transactions in detail. Based on this, real-time automated advice could be furnished to the user. The detailed information fetched would be highly advantageous for the patron to avail better financial planning services.

Conclusion

Technology will continue to influence the wealth management industry in the coming years. The only prerequisite for a wealth manager to strive for success is accelerating their technological transformations, shifting the load to wealth tech providers. However, despite the aforementioned trends, exceptional customer experience will remain the battleground for Wealth Management firms.

Without a doubt, the Covid-19 pandemic has pushed and reshaped myriads of businesses and industries to hop on the digital transformation journey. Additionally, embracing technology is inevitable, especially for the BFSI (Banking, Financial services, and insurance) sector after the shocking market condition, regulatory challenges, hybrid work culture, and lockdowns globally. The next few years are going to be challenging and critical for businesses, we will witness which industries are able to back the ever-changing business environment.

So, to fulfill the pushing requirements of the tech-savvy customers the BFSI sector future will significantly depend upon digitization, backed by innovative and new-age technology including APIs, allowing customers seamless, fast, and secure transactions, and most importantly interoperability of the banking systems.

Here are some eye-opening statistics answering the next-gen banking ecosystem’s question for automation in the banking industry i.e. “adopting fintech is worth or not”!

• Annually 500+ fintech companies are launched whilst they receive $50bn in funds

• Amid the Covid-19 pandemic, the global fintech investment hit $44bn

• By end of 2022, the fintech is projected to hit $310bn

The future is millennials and Gen-Z who are ready to spend extra bucks for greater service and convenience.

Few Trends That Are Here To Stay In 2022

NeoBanks

Also termed as “the next big thing in banking” – are bridging the gap between new-age digital customers and traditional banks. NeoBanks are banks with no physical branches instead have a digital presence. These financial institutions leverage AI and other innovative technologies to offer customized banking services to customers. Plus, NeoBanks are working on cutting-edge technologies and pushing traditional banks to revamp themselves to deliver at par customer services.

Artificial Intelligence and Machine Learning

There are plethoras of banking aspects such as traditional models, banking procedures, and legacy structures which are now being reshaped by AI. It has empowered the BFSI sector to meet its vital goals including amplified customer experience with virtual assistance, operational efficiency and optimization. Moreover, the new-age machine learning algorithms abet in processing data at a faster rate, credit fraud detection before happening, and reporting any credit fraud accurately to banks and customers in advance. On top of that, AI in banking and machine learning not only save time by extracting relevant data but also help in personalizing clients’ experiences, eventually helping BFSI in revenue growth.

According to the IDC report, after the retail sector, the financial services will be second to spend on AI closely 14% between 2021 and 2025 and the compound annual growth rate will be 24.5%. Hence, as we move further in 2022, the use of AI and machine learning will increase.

Big Data

The primary reason for big data analytics growth in the BFSI sector is the swift and voluminous increase in data through different modes of payment. So, big data empowers the BFSI sector to strategically manage unstructured information along with ensuring cyber security. Moreover, with instant predictive analysis and clarity, financial institutions can offer their valuable customers personalized investment options and product options. Not to mention, with big data not only relevant information is shared with the clients but also helps in protecting their sensitive information.

Blockchain

When it comes to throwing light on Blockchain, it has emerged as a successful technology ever since it first appeared. The platform underpins cryptocurrency and carries the potency to revolutionize the world economy.

Delving a bit deeper; Blockchain is fundamentally a distributed ledger that garners pivotal pieces of information or facts. The technology is principally employed to accumulate an immutable record of ownership and enable the transaction of the asset amongst distrusting parties.

Further, Blockchain technology in banking has become the talk of the town since its evolution as it delivers the following perks to the users:

• Transparency-One of the reasons for Blockchain technology getting famed is its powerful ability to deliver transparency. It empowers its huge set of users to have access in real-time by creating a public record of activities in the ecosystem.
• Decentralized- Blockchain technology boasts about being decentralized. In simpler words: it is not governed by any authority.
• Enhanced security- This impeccable feature ensures that any sort of alterations or modifications with the system is simply not possible.

RPA (Robotic Process Automation)

RPA copies and reproduces human actions to procure data in a faster manner. To add, this type of technology innovation is invaluable for the BFSI sector to maximize its operational efficiency, enhance customer experience, and amplify profitability. According to Capgemini, “RPA is able to generate 25%-50% cost saving via automation of data-rich mundane tasks, abetting to improved processes”. Also, RPA in the BFSI sector reduces errors by helping overburdened staff clear backlogs as well as eliminating repetitive tasks like data extraction, filling, and documentation. Besides this, RPA in banking has assorted functions that can streamline customer operations by shortening the call durations and automated response for faster resolution.

Voice And Chat Bots

Digital transformation and automation bring myriads of advantages to businesses and their customers which includes services from voice bots. Plus, bots can significantly increase customer services i.e. voice and chatbots can save up to 4 minutes in a query, delivering instant responses and enhancing customer services. Moreover, bots are seamlessly increasing customers’ banking experience – they offer instant answers which fasten the response time. Besides this, unlike traditional customer services bots are available 24*7 round the clock delivering exceptional customer experience and most importantly converting the potential visitor into leads.

Additionally, digital as well as traditional banks should opt for bots solutions to offer customized services and products to the customers. Along with helping agents to work on tasks that matter the most for the business.

Conclusion

Technology and data will play an imperative role in the BFSI sector irrespective of financial institution size and location. So, those who will embrace these new-age technology advancements will likely have more opportunities to compete in the market, grow their shares, and drive more profit.

The days are gone when masked intruders used to rob banks with weapons; in the era of digitalization robbing, a bank is just a few clicks away from the tech-savvy cyber-criminals. Hackers need only the loophole in the banking security mechanism- they can steal money as well as critically sensitive customer data which can further be misused in numerous ways.

Having said that, digital transformation is a prerequisite for every financial institution to strive for success in the hyper-competitive banking environment, as digital services abet in enhancing customer experience. There are myriads of services including premium payments, utility bills payment, online purchases and much more offered by financial institutions to its customers. However, the sector is vulnerable to cyber-attacks such as DoS attacks, phishing attacks, malware, hacking, spear-phishing, etc where hackers not only steal money but also vandalize the bank’s reputation. Hence, the best-fitted resolution for banks to be more agile, flexible, and most importantly scalable is an expert software testing service, Cloud computing, or specifically, Cloud!

So first, let’s delve deeper to know what cloud computing is all about!

Simply put, Cloud computing means delivering diverse computing services like processing power, software solutions, and data storage according to requirements, over the internet. In addition to this, the burden of owning complex IT infrastructure is eliminated making financial institutions future- ready. Cloud computing in Banking has acted as a catalyst for banks to embrace digital transformation, a key for their digital success!

Cloud Computing – Future Of Banking

Many industries are refined and reshaped by cloud computing, financial services being no exception. However, before IT teams and banking executives initiate the process of migrating to the cloud, one essential question that bank leaders call to be answered: is Cloud computing safe or not?

The answer is: Yes, cloud solutions are safe for banks. To add, with the right tools, expertise, migrating systems, and detection systems in place, cloud computing can offer safe and secure configurations to every bank globally, irrespective of the size. Additionally, when it comes to security in the cloud ecosystem, primarily it’s with cloud security or in simpler terms cybersecurity. After all, keeping confidential data and systems protected is essential for thriving financial institutions.

According to the CAGR report, the cloud security solution will witness 33.1% of growth in the banking sector. Also, a survey conducted by IBM states that 91% of financial institutions are actively using cloud services today or plan to use them in the next six or nine months – double the number four years ago. In fact, in today’s digital landscape banks encounter ever-changing customer’s behavior, innovative workspace dynamics, and the continued augmentation of data. So, cloud computing solutions have been proven in the past helping banks achieve unprecedented success.

 

Advantages Of Cloud Computing In the Banking Sector

• Enhanced Data Security

Data breach not only leads to huge monetary losses but also significantly sabotage a bank’s reputation. If one such incident happens it may cost a fortune as well as fine to the organization. Unfortunately, the majority of the data breach occurs within the premises systems, debunking the myth that migrating to the cloud is not safe. In short, the innovative, cutting-edge tools and resources offered by the cloud are more secure and flexible than on-premise systems provide. The banking cloud security by the cloud provider is undoubtedly more advanced, flexible, and secure than their in- house hardware and software.

• Say No To Mundane Tasks

Another astounding benefit of choosing a cloud is eliminating the repetitive tasks that often consume the IT team time. Once the data is secure in the cloud the next best thing any bank would require is saving time for their valuable resources. Furthermore, when banks choose cloud solutions and there is no physical set-up on the premise this ensures the workforce is dedicating more time and energy to the tasks that matter the most for the organization.

Moreover, no matter whatever the size of an organization it’s reported that the mundane tasks often drain more than 50% of the IT team’s time. Therefore, with cloud computing solutions your employees can focus on the value-adding task that will help the bank to strive for growth.

• More Agile And Innovative

The financial ecosystem is rapidly moving towards digital transformation and migrating to the cloud has become more imperative than ever. With cloud solutions, banks can streamline their complex processes which abet in enhancing customer’s experiences as well as employing cutting-edge technology such as AI, RPA (Robotic Process Automation) and machine learning to further accentuate millennials engagement. Not to mention, cloud-based infrastructure offers great agility to banks to quickly respond to changing market needs without any additional investment.

Probably the most shout out the advantage of cloud computing in contrast to its in-house premise is its easy adaptability to changing organizational requirements. To simply put, when banks need to expand their operations geographically the most daunting task they face is additional infrastructure needs, from whom to buy software and hardware, and hiring new staff to handle the workloads etc. However, with Cloud computing and cyber security, additionally, IT infrastructure and maintenance is not an issue, banks can scale up their operations with ease.

Conclusion:

As digitalization is the need of the hour, it’s vital for banks to reap the ultimate advantage of cloud computing and gain a competitive edge. Only cloud solutions have the potent potential to change the banking landscape – helping banks offer at par customer services, ensuring data and information security, and achieving business goals. So, choosing the right cloud service partner and software testing service is essential for banks to take their banking services to the next level!

The fintech industry has always been unsusceptible to new innovations. Post-2020, the global pandemic has brought unusual change to every sphere of our lives, the financial institution being no exception. To strive for success digital transformations have become more recognizable than ever. Here is where cloud solutions and RPA alias Robotic Process Automation in Banking can become a potent problem solver that permits streamlining time-consuming heavy jobs, eliminating human error, extensive cyber security and most importantly cutting down organizational costs.

PwC reports disclose that nearly 81% of bank CEOs are apprehensive about the rapidly changing technology. To add, the challenges are not only to keep costs low and maximize efficiency but also to ensure maximum security. And to overcome these challenges innovative RPA and Cloud computing are effective tools.

 

Let us dig deeper to know how RPA applications in varied BFSI segments along with cloud storage can refine the financial sector!

Why RPA Is Significant In The BFSI Sector?

As the name indicates RPA (Robotic Process Automation) is utilizing software to automate tedious and monotonous tasks. To add, RPA in banking performs a plethora of tasks including huge calculations, automating transactions, data-processing, and solving complicated problems. Besides this, the BFSI is exploring the possibilities of RPA to lessen-down human labor, increase efficiency and productivity, and complete time-consuming tasks in a faster manner. Not to mention, with the use of RPA the large-scale back-office activities are effectively streamlined which were earlier stalled by bank employees. Scalability, consistency, and cost-effectiveness are some of the key advantages of robotic process automation.

Furthermore, digital

transformation in the BFSI sector could include ameliorating the use of Artificial intelligence (AI) to amplify customer relationships, construct customized financial plans, and automate the debt collection process. Moreover, the BFSI sector is also moving towards cloud solutions for storing voluminous data.

RPA Applications in Financial Sector

Customer Onboarding

One of the time-consuming processes in the financial sector is customer onboarding as manual verification of documents for each customer is a prerequisite. Plus, setting up a customer’s profile on a different platform and internal system is also imperative, which in turn is quite time- consuming. However, RPA software can simplify the same process by procuring the customer information from KYC documents by using OCR (optical character recognition). The obtained data can be compared with a customer-filled form and in case of any disparity detected or no disparities detected it will be automatically written down in the customer profile. Thus, with the use of RPA, the customer Onboarding process is more accurate and helps in saving hefty time for employees.

Processing Of Loan

The process of approving a loan often goes through multiple steps such as credit score, employment history, repayment history, and inspection, etc. RPA is significantly effective for loan-based activities as it proffers maximum clarity as well as precision across every task in the process.

That said, with the use of RPA the complete loan approval process is automatic i.e., financial institutions can collect and manage customer records at every stage of the loan approval journey. Besides this, RPA in a few minutes can search for necessary information in the document base which may be required for approval or non-approval of the loan. The laborious loan processing activity can be completed in 10-15 minutes with RPA!

Credit Card Processing

To process a credit card there are too many tasks required namely validating customer information, checking customer background, inspecting customer credit history, and verifying records from various sources. But with RPA the credit card process can be done in a few hours as all the information is concurrently obtained from varied systems, then matched with customer data, and verification is finished within a few hours. On the basis of RPA information, the decision of approval of a credit card can be taken. Hence, the entire cumbersome credit card process is faster with the help of RPA benefiting both the parties, increasing bank performance, and higher customer satisfaction rate.

Automatic Accurate Reports

Like other private and public companies, all the BFSI companies need to prepare annual reports for major stakeholders to know how the business has performed in the last financial year. Considering the importance of financial reports there are no odds for financial institutions to make any mistake. With RPA the risk of human error is eliminated as the details are automatically filled in the reports. Therefore, RPA abets the financial institutions in speeding up the reporting process, delivering sheer accurate and true information with their stakeholders.

Opening Of Accounts

With RPA integration in the banking sector, the process of account opening can be simplified and faster. Using RPA, the crucial customer data can be procured from the form and the same can be utilized in various other host applications. A similar accounting opening algorithm can be implemented with RPA, making the accounting opening process easy.

Know Your Customer (KYC)

Nowadays, Know Your Customer (KYC) is an obligatory process for every customer and bank. In this process, there are more than 500+ FTEs required to perform for customer history. Manually performing these checks requires time and money. So, financial institutions are looking to use RPA to perform and validate customer data, helping save employees time as well as with minimal errors.

How Cloud Computing Is Significant In The Financial Sector? The financial sector in 2030 will completely be different from today, meeting tech-savvy customers’ expectations and comprehending fast-paced digital transformation- the banking sector and other financial institutions need to prepare for the future. Hence deploying cloud computing technology in their growth strategies can help reshape the financial sector landscape. With that said, cloud computing in banking is not just an innovative technology for the BFSI sector instead its destination for myriads of firms to store huge amounts of data and applications in the most secure way. Besides this, many cloud service providers offer numerous PaaS (product- Service-Systems) also known as Product-as-a-Service that helps banks to deliver relevant products in the market quickly, amplify revenue, and enhance customer insights. Also, with cloud solutions financial crimes (fraud and money laundering) can easily be curbed as thousands of transactions can be scanned per second, helping banks combat fraudster activities.

How Cloud Computing Is Significant In The Financial Sector?

The financial sector in 2030 will completely be different from today, meeting tech-savvy customers’ expectations and comprehending fast-paced digital transformation- the banking sector and other financial institutions need to prepare for the future. Hence deploying cloud computing technology in their growth strategies can help reshape the financial sector landscape. With that said, cloud computing in banking is not just an innovative technology for the BFSI sector instead its destination for myriads of firms to store huge amounts of data and applications in the most secure way. Besides this, many cloud service providers offer numerous PaaS (product- Service-Systems) also known as Product-as-a-Service that helps banks to deliver relevant products in the market quickly, amplify revenue, and enhance customer insights. Also, with cloud solutions the financial crimes (fraud and money laundering) can easily be curbed as thousands of transactions can be scanned per second, helping banks combat fraudster activities.

A Peek Into the Insurance Industry

The insurance industry in India is vast with over 58 insurance companies spread across the country. The overall market size of this sector was valued at $280 billion in the year 2020. Between 2019 and 2023, the growth of this sector with a CAGR of 5.3% is expected, thereby contributing to the ever-growing nature of this sector and rasing need for good insurance software solutions. In addition, the government has also taken plenty of initiatives to boost the insurance industry. For instance, in August 2021, the Government of India approved an investment worth Rs. 6,000 Crores into entities. This approval ensured the offering of export insurance cover in order to facilitate additional exports in the next 5 years worth Rs. 5.6 Crores.

Similarly, the government has also taken other initiatives to support the other segments of the insurance sector. This brings into the light the different types of products available in this sector. The products range from life insurance, health insurance, and motor insurance to home insurance, and others. Of these available products, it’s key to note the market penetration that these insurance products have. In FY 2020, there was just about 3.76 percent of market penetration whereas in FY 2021, there was 4.2 percent penetration. Overall, according to the Swiss Re Institute, India has observed a positive increase in market penetration of 0.1 percent and has a global market share of 1.7 percent.

Insurance is typically bought either directly from the insurer or through independent agents and commercial brokers. This is called the insurance distribution business. Over the time of the Covid-19 pandemic, the insurance distribution business has grown manifold. One of the products of insurance that experienced a spike in market penetration was health insurance.

Current scenario of penetration of Insurance distribution

There has been a need for a sharper and improved distribution strategy for insurance products. Covid-19 has contributed towards accelerating the process of change in distribution models across different industries. Distribution is a critical link to ensure the relationship and reach between the product and the customers. The pandemic drove insurance providers to integrate the best practices of distribution and technology as well. The process of insurance sales, in particular, has faced the most disruption. The traditional means of insurance sales involved face-to-face meetings and the physical presence of the customer at the insurance office. However, with Covid-19, there has been increased adoption of digital technologies thereby allowing virtual and remote sales.

Another aspect that has led to the increased penetration in the insurance landscape is the Bancassurance channel. This channel has highlighted the aspects of increased trust of customers with banks rather than other private entities. In 2019, the IRDAI also introduced a new distribution channel called Common Public Services Centres for the rural market in specific. Overall, these initiatives have resulted in the total number of rural authorized personas to 16,555 as of FY 2020. This has also contributed to the total insurance premium collected in FY 2020 to roughly contribute to one-third of the insurance market amounting to Rs. 253 Crores.

Areas of fallback

One of the main areas that have resulted in resistance towards increased insurance penetration is the lack of education among customers. In addition, customers also consider insurance policies to be an expense rather than a long-term asset. A shift in this perception can help increase penetration across the entire insurance industry. Another reason for this low penetration can be attributed to the complex paperwork in non-digitized processes.

Scope for Improved Market Penetration

Some of the areas that can be considered for potential venturing for insurance companies are the segment of digitization and the process of increasing awareness. Digitization can help eliminate customer resistance due to feasibility, accessibility, conveniences, and complex paperwork. Increasing awareness is also a potential pathway for insurance companies as it can help increase market penetration by providing a different perspective to customers. Ultimately, exploiting these areas can be beneficial for the insurance industry.

Why is Improved Penetration of Insurance Distribution Important?

While the insurance sector in India has been experiencing dynamic growth over the last few years, its global market remains abysmally low. Having an increased penetration of insurance distribution can eventually lead to a positive overall economic impact. The industry of insurance contributes a reasonably large amount to the country’s GDP. Experiencing increased penetration can contribute to an increase in GDP. Moreover, it can also improve the overall benefits received by the customer thereby improving their quality of lives. Ultimately, these benefits can be achieved by increased investment in insurance products and improved digitization.

How can Winsoft’s SmartInsurance help with the process?

Winsoft’s Smart insurance can help with the digitization of the insurance distribution business. It can help increase productivity, profitability, and scalability of the company. The end-to-end life and non-life health insurance distribution software with digital processes helps with increased penetration and ease of use. Some of the other features of Smart Insurance are that it has a flexible open framework and it comes with accurate income calculation and reconciliation to detect income leakages. There is also an advisor portal, operational portal, customer portal, and business MIS. With Smart Insurance, you can also support all your regulatory and audit compliances.

In Conclusion

While the insurance segment has experienced dynamic growth, there is potential for improved market penetration. Digitization is one of the key trends that have been observed in insurance software solutions. However, improved digitization and increase in adoption of awareness programs can be beneficial to enhance market penetration. With Winsoft’s Smart Insurance, you can enhance your digitization, reduce dependencies on policy data from insurance companies, stay compliant, and detect income leakages among others.

The rapid evolution and digital transformation in financial services has completely changed the way primary market operations take place. From digitization of systems to automation of processes, various changes brought about by technology have greatly affected the primary market issuance. Until the early 2000, the primary market operations like initial public offer, rights and bonus issues, preferential issues, etc. were conducted manually. However, with the advent of ASBA, digitization of primary market issuance methods is used.

Evolution of Primary Market Issuance

There has been a significant change in the Indian economy’s environment over the last couple of decades. Earlier, the process of applying for the primary market issuance used to take place manually which made managing the application cumbersome for the financial distributors. With digitization, everything changed!

The distributors can now give more time and dedicated service to their customers. Digitization has made the application process easier, safer and faster.

Time and again regulators seek advice from industry experts and come up with solutions. One such solution that changed the face of primary markets is ASBA. ASBA is the process developed by SEBI for applying to IPOs, Rights issues, and other similar transactions.

ASBA stands for Applications Supported by Blocked Amount. It is an application that enables an investor to block his or her application money from the bank account for a specific issue. This procedure works seamlessly for primary market issuance.

Earlier when digitization was nonexistent, it was difficult to handle the large volume of applications manually. As the primary market issues involve allotment of securities, for numerous applicants who do not get allotment against their subscriptions, the application money needs to be refunded. Such refunds used to take a very long time to get credited back into the applicant’s bank account. Several complaints were received from the investors to speed up the process to avoid funds from being sited idle. The opportunity cost for the market participants is high. It also increased the number of transactions like debiting the money from client’s account for applying in the issue and if there is no allotment or partial allotment then refund of the remaining proceeds to the investor’s account.

These increased numbers of transactions taking place, had also increased the cost of reporting and the risk of mismanagement. The instances of one person’s refund being transferred to another person’s account were often reported. The manual process was bound to human errors. But it came with a cost of discouragement amongst investors from participating in the primary market issues.

To clear out these problems, ASBA was introduced. By using the same technology, in 2016, Winsoft has developed an application called SmartASBA to assist financial distributors like Banks and Brokerage Firms.

By automating the task of processing bulk applications, SmartASBA has saved several thousand hours of the financial distributors and has removed the scope for human errors. As with ASBA, that merely blocks the amount in the account rather than transferring it, the number of transactions dramatically reduced.

With this, the process of initiating the refund has become very easy and seamless. After digitization, this process only involves unblocking the amount, without the need to enter into any redundant set of transactions.

Technologies Backing Digitization of Primary Market Products & Challenges

It was a gradual process to gain investors’ trust in technological advancement in the primary market issuance sector. The technology of ASBA and UPI played major roles in digitization.

As we discussed, ASBA is a system to block the amount in an investor’s bank account. The UPI is a system that seamlessly combines various banking features into a single mobile app. It allows users to manage multiple accounts in one place and make and receive payments using a single application.

Each platform is designed with advanced technologies, ensuring that primary market distributors can give impeccable service to their customers. This combined with SmartASBA ensures smooth flow, from onboarding to handling applications, each function is carried out error-free with Winsoft Technologies.

There are several challenges faced by the participants related to the primary market issuance. Some of these are as follows:

• Unpolished Process  Several times, the investors do not receive the UPI mandate and the process of the application fails. Since multiple technologies and platforms are being used, sometimes they do not work in sync and disrupt the process.
• Complexity Many investors find it confusing to jumble between the applications. From bank or broker’s platform to UPI application to approve the mandate. This process could be made a little more synced in the coming future.

The primary markets are currently embracing new changes, in which adapting to digital trends and technology while also innovating with new business models and products/services is taking place.

The Bottomline

Today, technology and digital transformation in financial services is becoming an essential part of the entire financial market ecosystem. Keeping this in mind, Winsoft Technologies offers an array of advanced solutions via products and services to enhance financial processes. If you are looking for a solution to make things easier then search no more. To know more about our innovative solutions & services connect  with us today!

About Winsoft Technologies

Winsoft Technologies was founded in 1993, with a mission of delivering excellent, creative, cost-effective solutions with the most suitable and latest banking and financial solutions. Winsoft provides business solutions to Fintechs across the Banking, Financial Services, and Insurance (BFSI) industry using leading-edge technology and expertise, and almost all top blue-chip financial distributors are clients of Winsoft.

Journey Towards Providing Game-Changing Solutions

BFSI encompasses organizations that offer a variety of financial products and operations to a broad set of individuals as well as corporate clients. The BFSI software products help entities such as financial distributors and insurance businesses to use digital technologies to make their operations scalable.

Due to the digitization of the BFSI product distribution, it has become easier for consumers to go paperless. Bank accounts can now be fully operated remotely. When an IMPS transaction can be done at the tap of your fingers, why would you want to spend hours standing in line to make the transfer?

Post demonetization, the digital products helped the financial institutions increase in size and influence as there was a shot up in saving flows into equity and debt-oriented mutual funds and life insurance policies. In short the financialisation of savings began at rapid pace. The thrust towards the cashless economy forced all BFSI organizations to partner with digital service providers for disbursement of other banking and financial distribution products such as Demat accounts, insurance policies, Mutual Fund, Direct investments, etc.

Efficient Financial Product Distribution with Winsoft

Back in the late 90s when dematerialization of shares was a new concept in India, people hesitated at first concerning safety but now 100% switch from physical shares to dematerialized shares has happened increasing transaction multiple folds. This demanded a comprehensive system for management. Since 2001, Winsoft’s DeMATrix has been helping clients with the Depository Participant (DP) solution. DeMATrix is an integrated CDSL & NSDL solution that simplifies more than 1 Lakh DP transactions every day.

Dematerialization and stock market investment awareness gave a parallel rise to the mutual funds industry. This sudden boost during that era when markets were touching all-time highs called for a solution that provided ease of operability for fund houses and to maintain customer data in a more efficient and customized way. In 2003, Winsoft’s SmartMutual, a leading mutual fund distribution solution, enabled the mutual fund distributors to operate efficiently. It has automated all the process right from digital customer onboarding to customer dashboard and income calculation for distributor

The smart money had invested huge piles generating immense wealth by the time markets fully recovered. The number of Indian millionaires are increasing very rapidly every year. This paved the way for rapid growth for wealth management business in India. To meet the needs of financial planners and wealth managers, Winsoft developed SmartWealth in 2014 ; a robust software that enables financial managers to manage multiple asset classes seamlessly. It features a front-office interface and a back-office system that works seamlessly.

From 2009, the National Pension Scheme (NPS) was opened for all the citizens of India. For many years, the scheme did not gain popularity, until they came up with pension cum investment plans. This sudden boost in the National Pension Scheme (NPS) and Atal Pension Yojana (APY) investments called for a smart application. That’s when SmartNPS & SmartAPY was born out of necessity in 2015. SmartNPS is an automated solution that enables you to manage your investments into a National Pension scheme. It is easily integrated with various back-office processes. SmartAPY is a web-based solution that simplifies the processing of APY contributions. It features a unique reporting feature that allows users to easily analyze their contributions.

With the introduction of Application Supported by Blocked Accounts (ASBA), investors could safely block their funds in their accounts while making an application to an IPO. This reduced the transaction costs and unnecessary processing of payments from one account to another. Application refunds got faster and accurate with ASBA. When the distributors needed smart applications to manage the processing of the volume of IPO applications, Winsoft developed SmartASBA. It is a platform that enables financial distributors to process IPO, FPO, NFO, and DEBT applications.

With the covid-19 pandemic there was a big realization amongst Indians about the importance of having health and life insurance. The India market offers the immense opportunity for insurers as insurance penetration is very low in India. The insurance distributors were finding ways to increase their reach and hence rapidly adopted digitization.

Winsoft’s Smart Insurance is a comprehensive software solution that provides a complete view of your insurance distribution business. AGILE is a general insurance & life insurance enrolment system and AGENT is a training system that enables the insurance industry to run smoothly.

Due to the pandemic, many people started investing in different asset classes. Increased awareness led to a sudden boost in Sovereign Gold Bonds investment and financial distributors lacked robust platforms to handle the load. That’s when Winsoft provided SmartSGB in 2021 to fulfill clients’ needs by providing an end to end software for Sovereign Gold Bonds.

The Bottomline

Winsoft Technologies have ventured into the arenas of Artificial Intelligence and Machine learning to help banking and financial solutions providers to offer a seamless banking experience. AI’s optical character recognition (OCR) allows user information to be auto-filled by nitpicking relevant information from documentation given as proof at the time of the customer onboarding process. This process minimises fraud and increases the efficiency of their products and services.

To know more about our innovative solutions & services connect with us today!

Technology has advanced enormously in recent years, allowing for innovative solutions that have fundamentally altered the way various industries operate. The wealth management industry is at the forefront in a long line of industries to adapt to and evolve using cutting-edge technological solutions. The days of asset managers and financial advisors spending hours poring over spreadsheets and analysis may be over.

Digital payments are being adopted on a larger scale after research showed 48 billion digital transactions in the year 2020.

For all of us, the past year has been a period of considerable uncertainty. Existing pressures such as evolving consumer expectations, more competition, ongoing regulatory changes, rising expenses, and squeezed profit margins has just been exacerbated due to the pandemic. Enterprising enterprises, on the other hand, are in a great position to capitalize on their strengths, adapt to industrial and social changes, reduce their cost base, and expand market share if they are supported by the correct technology foundation.

The entire financial landscape now shows promise of simpler solutions for complex fiscal difficulties, thanks to this beneficial growth in the wealth management sector. As an investor, you now have access to an environment that allows you to make use of cutting-edge technology to better manage your capital.

What Has Changed Because Of Technology?

So, how can traditional businesses deal with all of these pressures? Organizations that are willing to adapt will benefit greatly from changing market conditions. Customer loyalty and success in wealth management are built on good customer connections and trust in the company’s skills, all of which are backed up by a flawless customer experience.

Customers’ expectations for the online experience have risen as a result of increased digital literacy across all generations. Customer has increased demand for information and services that are always available, accessible from a variety of devices, and have a uniform look and feel across all touch points.

Due to the pandemic’s limits on our normal behaviour, current tendencies have intensified. Customers today expect the same slick digital experience from all providers, including wealth managers, thanks to the same experience provided by other businesses. According to a Salesforce study, 62% of buyers say their interactions with one industry influence their expectations of others.

These expectations, combined with the ease with which consumers may investigate financial products and services online, have resulted in a decrease in long-term brand loyalty. Customers are now more likely to transfer providers if they are dissatisfied with the service provided by one.

Wealth managers are well-positioned to construct customer-centric operational models that place users at the centre of decision-making to satisfy the increasing demands of the market, customers, and regulators by building on their existing relationships.

Investing in new IT infrastructure may help organisations remain competitive, manage risk, and maintain data security while also lowering costs and increase operational efficiencies.

Technology has also helped in incorporating personalization in wealth management. It allows a deeper understanding of your financial habits and provides customizations accordingly.

Digital wealth management solutions with “Do it yourself portals” that are well-designed are already gaining traction. Wealth management portals that are well integrated with global investment channels take full advantage of data analytics, reporting, and dashboards which assist both wealth managers and investors in evaluating all of the options available to them and making the best wealth management decisions possible.

Complete Wealth Management Suite By Winsoft Technologies

The Wealth Management solution from Winsoft Technologies is a multi-module, integrated platform that allows you to provide best-in-class financial investment to all of your clients. SmartWealth, SmartMutual, and SmartSGB are part of the Wealth Management suite of applications.

These solutions are web enabled and are developed with the most up-to-date technologies. The technology employed allows for the whole process of paperless client onboarding along with dashboard of investment.

Here is the brief about solutions provided by Winsoft Technologies for wealth management.

SmartWealth:

It is an end-to-end Wealth Management Software solution that works with a variety of asset classes such as mutual funds, Bonds, SGB, fixed income/debts/NCDs and alternative products such as PMS, AIF, SP and so on. It has completely integrated back office, front office, and customer interface modules.

SmartMutual:

It is the most popular mutual fund business solution being used by mid-sized distributors to large distributors including India’s top MF distributors. It has a back office module for central operations, a Sales/RM interface for branch operations, and a customer interface.

SmartSGB:

It is an end-to-end processing module for requests of Sovereign Gold Bonds starting from digital onboarding of clients to bond purchase, redemption and cancellation of investment. Flexible and intuitive user interface with API based framework for easy integration with digital channels like the Internet and mobile phones.

To know more about the advanced solutions for wealth management connect with us today!

Technology has changed the way we look at everything; be its listening to songs of our choice to make any investment decision for achieving our financial goals. Technologies have changed the face of the BFSI industry. Due to the pandemic, and various restrictions multitudes of banks and FIs are modernizing and improvising their infrastructure to support digital banking. The digital capability of facilitating smooth customer on-boarding including KYC, lending, sales automation, and many other services has been of immense use for banking and FIs service providers to offer seamless services to their customers.

There has been a massive rise in the Fintech investments in India as compared to before covid days. 33 new unicorns have emerged since the beginning of 2021 and as per this rate, India will manage to get more than 100 unicorns by 2022. Start-ups have been started offering innovative technologies to reduce the asymmetry of information between financial institutions and investors. Fintech SaaS and Insurance technology entities witnessed total investments of 145 million US Dollars and 215 million US Dollars in the year 2020 respectively. If we check today, India has more than 50 Fintech entities whose total valuation would be more than 100 million dollars.

The GoI’s BharatNet mission is driving internet penetration across remote regions paving the way for technology-driven BFSI services amongst them. The technological marvel of UPI has further reduced the cost of transactions as well as the turnaround time for any transaction. India also witnessed a surge in biometric transactions driven by AePS i.e Aadhaar-enabled Payment System amongst remote regions. These transactions are currently to the tune of over 200 million every month.

Retail investors in Tier II and Tier III cities have begun to tap advanced investment products such as Mutual Funds and Direct Equity. NSE has seen a steady growth of 11% CAGR in its investor category over the decade to reach to 2.78 crores. On the other hand, there are about 4.58 crores BSE investors at present, a figure that has grown by 26% in the past year. This is mainly because of investment done through trading applications as well as Robo- Advisory investment engines that give personalized investment advices using data analytical tools and Artificial Intelligence to interpret the data for precise and accurate results.

AI (Artificial Intelligence and Machine Leaning)

Technologies like AI and ML has successfully helped banking and financial service providers to provide frictionless and innovative banking solutions. AI’s optical character recognition (OCR) enables auto-filling user details from their document proofs during the customer onboarding process. The tools used in AI and ML are excellent in preventing fraud at the same time offering automated product recommendations to the customers.

Financial APIs

Financial APIs (Application Programming Interfaces) are one of the most important technologies used extensively in digital banking. API enables the companies to open up their application data and functionality to external third-party developers, business partners, and internal departments within their companies to connect with the application and allow interactions, transactions, payments, and sharing of information happen. It takes care of operations like KYC, the credit assessment, retrieving information while filling out forms, e-sign, and so on. There are certain specific open APIs that allow third-party vendors to access consumer accounts, known as open banking.

Currently Winsoft is using API based technology in its applications like SmartWealth, SmartMutual, SmartNPS & SmartASBA for exposing and consuming different set of APIs to execute various tasks digitally.

Cloud technologies

Customer on-boarding rates have increased on account of digital banking. But with a growing number of customers there also comes an increased amount of data. Cloud technology is thus an optimal way to store, organize, and retrieve data as and when needed at the same time build essential statistics. Banks and FIs use Cloud based technology to build smarter marketing and sales strategies to serve their customers better and cross-sell relevant products to them.

Winsoft has been using Cloud Technologies for a very long. It is been implemented in our SmartMutual, SmartWealth, SmartNPS & SmartASBA applications.

Robotic Process Automation (RPA)

Robotic Process Automation (RPA) use the intelligent automation to drive efficiency, remove repetitions, and improve customer satisfaction by providing fast and efficient services in the BFSI industry. RPA is transforming the way banks can operate improving the other parameters such as cost-reduction, accuracy, compliance and operational efficiency.

Winsoft is currently in the process of launching solutions to implement RPA for various processes.