2024 banking trends and innovations: Insights from Sajit Vijayakumar, CEO of Infosys Finacle

Digital Reinvention
27/05/2024 Interview
profile picture of Sajit Vijayakumar

Sajit Vijayakumar

Infosys Finacle

CEO

This year, Qorus continues its Banking Innovation Awards adventure with Infosys Finacle. This partnership is a natural fit with a leader in innovation and technology, as Qorus already collaborates with Infosys Finacle on its annual flagship study, Innovation in Retail Banking.

What are the trends in digital transformation and innovation in banking? What are the expectations for the projects submitted? What will the bank of tomorrow look like? Sajit Vijayakumar, CEO of Infosys Finacle, tells us more.

Tell us more about yourself and your role at Infosys Finacle.

As the CEO of Infosys Finacle, I lead the business for the industry's leading digital banking solutions suite. With over 27 years of experience, I specialize in technology-driven business transformations, focusing on the intersection of technology, banking and customer value. I strive to empower teams to build and deliver modern solutions so that banks can engage, innovate, operate and transform better. Previously, as COO of Finacle, I oversaw product management and delivery teams. My career includes roles in consulting, global delivery and customer engagement across the US, UK and India, consistently leveraging technology for business growth. Today, banks in more than 100 countries rely on Finacle to help more than a billion people and millions of businesses to save, pay, borrow and invest better.

What do you see as the key trends in banking innovation and transformation this year?

Broadly speaking, I believe the industry will see significant transformations and innovations in response to three pivotal shifts in 2024 and beyond.

Firstly, there will be continued transformation and innovation across business model elements. Banks will focus their efforts on pushing the envelope by scaling new models, such as banking-as-a-service, embedded finance, and financial and non-financial marketplaces. Innovation in customer engagement will aim at integrating banking more seamlessly into the primary journeys of both individual and business customers, and at providing hyper-personalized experiences. Banking operations will leverage digital transformation for further automation, to build resilience and to augment the workforce.

The second trend that banks are dealing with is a dual progression of technology, where new technologies are emerging while existing technologies are maturing. So, on the one hand, banks will look to experiment with technologies like generative AI and web 3.0, and on the other, accelerate the adoption of ‘mainstream’ technologies like cloud and APIs. In both cases, having the right architectural foundation will be critical to unlock full potential.

Then there is the increasing focus on initiatives around sustainability, security and privacy. Worldwide, we are seeing stringent regulatory environments shaping the governance landscape, pushing banks to become more sustainable in their operations, more responsible in their use of data, and more cognizant of the ethical aspects of AI. We anticipate the industry will intensify investments and initiatives to innovatively comply with these mandates.

Why is Infosys Finacle partnering with Qorus for the Banking Innovation Awards?

At Infosys Finacle, innovation is ingrained in our ethos. We continually empower and advocate for banking innovation, pushing the boundaries of what's achievable with today’s technologies and industry infrastructure. From closely tracking innovation trends – where we have a strong partnership with Qorus - to nurturing collaborative ventures with our client banks and the broader fintech community, innovation is at the heart of everything we do.

We saw immense value in expanding our partnership with Qorus for the 11th edition of the Banking Innovation Awards. Over the years, Qorus has built a great awards program that recognizes the most remarkable and impactful innovations in banking globally. The two organizations have also built a great collaborative relationship over the years. This partnership strengthens our commitment to fostering innovation and excellence in the banking sector.

What kind of innovative projects would you like to see submitted this year?

In our latest Innovation in Retail Banking study, only 11% of respondents said that they had deployed digital transformation at scale, and it was delivering as expected. Therefore, one clear takeaway is that investing to scale digital transformation success should continue to be the focus.

Based on our experience of serving banks globally, there are five key areas where banks will continue to invest, and we will see innovations across this spectrum.

One is elevating digital customer engagements to drive growth. Here we look forward to initiatives where banks prepare to play a dominant role in the customer ecosystem and integrate their services seamlessly using the possibilities unlocked by embedded finance.

The second is digitizing and automating operations ubiquitously. The most powerful innovations in operations will be of course those that help banks drive down costs and improve organizational effectiveness. Third, innovating continuously, to create new value and to stay competitive in the financial and non-financial ecosystems. Product innovation is making a strong comeback, with banks co-creating offerings with partners and even getting customers to design products. Fourth, innovations leveraging the power of modern technologies like Gen AI, cloud and API to unlock new possibilities. Finally, innovations in building talented teams and purpose-driven culture to unlock the true potential of the organization.

Digital Reinvention
23/03/2023 Study

Innovation in Retail Banking 2023

Infosys-Finacle and Qorus have also been conducting annual research into innovation in retail banking for over 10 years now. What are the challenges facing the heads of innovation and transformation?

I’d like to spotlight four challenges here and some of these have consistently figured in the research over the years. 

Firstly, maintaining and executing a clear vision on building competitive advantage and fostering collaboration with fintech, big tech and players from other industries poses a significant challenge for banks in today's evolving landscape.

Secondly, banks continue to grapple with legacy systems, and their inability to leverage data  and AI. In last year’s survey, 40% of respondents said they had made no progress, or even fallen behind, in their efforts to transform legacy core systems, while 25% said this about their (digital transformation) efforts to improve the use of data, analytics and AI. They must quickly resolve these issues if they are to unlock new opportunities, for example those created by AI and generative AI.

Thirdly, embracing an innovation and digital-first mindset as an organization is a continuous journey. Banking leaders have to gear up for leading in times of rapid innovation and change. This will be impossible without the right talent and skills. Significantly, our research shows that 22% of banks are not making progress in improving digital talent and skillsets.

Striking a balance between driving innovation, maintaining the stability and security of their core banking operations, while complying with ESG and data privacy mandates is the fourth challenge.

Tell me more about your predictions for banking. What will banking look like in 2030?

Interestingly, we did a crystal ball prediction for 2030 in our joint research with Qorus – this validated a lot of our thoughts on how banking in 2030 will look. 

In terms of customer engagement, about 78% of executives agree that more than 50% of banking transactions will be initiated through non-banking channels. Consequently, 85% agreed that bank branches would reduce by at least 25% by 2030.

73% believed that thanks to digital transformation, the current cost-to-income ratios of incumbent institutions would reduce substantially by the end of this decade.

Bankers will continue to accelerate the adoption of cloud-based banking, prescriptive AI, and composable core banking architecture. The survey showed that banking leaders know what awaits; for example, 81% said more than 75% of enterprise banking applications would move to the cloud by that time.

Around 55% of bankers believed that more than half of the top 10 financial services firms will combine banking with retail, healthcare and other services.


The deadline for entering the awards is June 21, 2024. We'll tell you all about it and answer all your questions on Thursday May 30 with two webinars, one in the morning and one in the afternoon, CET time. Book your session now. We look forward to seeing you there.

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