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Banking goes digital: It’s time to implement your strategy

Senthil Ravindran
Published: July 14, 2021

If the need for banking and financial institutions to embark on their digital transformation journeys was a business priority before COVID-19, this necessity has ascended to entirely new levels over the past year and a half. Now, as we near the end of the pandemic, growing numbers of businesses are looking to incorporate innovative digital financial services that allow them to be more agile and enrich customer experience. 

Just consider these figures:

  • As financial markets evolve around the globe, the transformation is spearheaded by embedded finance which, according to Insider Intelligence, is expected to have a total addressable market size of USD $7.2 trillion by 2030.
  • According to BDO’s 2021 Financial Services Digital Transformation Survey, 61% of financial institutions are adding new digital projects, and 51% are revising their long-term strategic vision.
  • According research from Equinix, 91% of businesses are likely to use Banking-as-a-Service (BaaS) as an efficient way to achieve a faster time to market post the pandemic hit.

While these figures make it clear that businesses see the need to evolve, many still need to act: According to BDO, 40% have a digital transformation strategy but have not implemented it yet.  When these businesses do move forward there will be challenges to overcome.

Specifically, many will struggle with innovative tools that operate in silos, making it difficult to measure and quantify real outcomes. If that wasn’t enough, they also face challenges that threaten the very existence of the industry. These include:

  • Digital disruption: FinTechs are gaining customer acceptance and experiencing incredible momentum while new BigTech firms are emerging.
  • Increasing customer expectations: Customers seek seamless on-demand banking experiences that can anticipate their needs and respond with suitable financial products.
  • Regulatory compliance: As digital adoption increases, regulations and standards are growing and are also being strengthened to protect consumers and ensure quality of governance. 

Financial institutions require a partner capable of helping them successfully navigate this new territory. Virtusa’s Digital Product Workbench (DPW) on Amazon Web Services (AWS) enables financial organizations to rapidly launch financial products using pluggable BaaS propositions and embed ready-to-use customer journeys in payments, lending, and deposits.

Financial Institutions on DPW can drive significant revenue growth through third-party vendor partnerships in terms of valuable fees and deposits with managed risk and compliance.

The keys to delivering desired outcomes

DPW enables organizations to rapidly develop pluggable customer journeys for faster time-to-market. BaaS propositions like buy now pay later, digital wallets, credit score modeling, small ticket/SME lending, and issue card can be created quickly to enable financial institutions to become agile and nimble.

DPW guides financial institutions to deliver custom user journeys from the ideation phase to the finished solution by leveraging the following elements:

  • Working backwards methodology: DPW ingrains Amazon’s working backwards methodology, allowing organizations to ideate while keeping the customer problems in mind and providing solutions that will solve their unique customer issues.
  • Partner and application programming interface (API) ecosystems: DPW provides standardized RESTful APIs for end-to-end integration of customer journeys and use-cases. Componentization allows easy configuration for custom user journeys. DPW also allows financial institutions to onboard third parties, including customers, technology providers, and other required partners, for collaborative development of embedded banking products.
  • The digital twin/synthetic dataset: DPW enables the rapid development of digital products and services over a cloud enabled digital twin that is developed utilizing a use-case based approach and by bringing in a host of tools and accelerators. The digital twin environment uses synthetic data generated in line with the production data schema and metadata requirements, which allows it to understand product performance and optimize the behavior of the product.
  • Integrated multi-organizational teams with a common objective: DPW allows organizations to develop solutions within collaborative environments where domain experts from a multidisciplinary/multi-functional team work to achieve creative and comprehensive results.
  • Standardized development over cloud integrated development environment (IDE): DPW provides the ability to create multiple instances of the IDE and collaborate with multiple teams simultaneously, while ensuring coding standards are maintained with CodeGen tool support for microservice development like Python and NodeJS.
  • Well defined path to production: DPW integrates with organizational code repositories and the DevOps pipelines to allow a seamless flow to production.

How can DPW be used?

DPW can be used to:

  • Develop embedded banking products: DPW allows banks to engage with client’s business audience and deliver innovative embedded finance solutions with trusted partners in deposits, lending, and payments in a simple yet efficient way. DPW can help build ready-to-use customizable embedded banking solutions enabling go-to-market in a matter of days.
  • Rapid tech validation and adoption: DPW features pre-uploaded solutions for rapid technology validation such as Amazon Managed Blockchain Solution, Amazon Bracket, and significantly reduces the cost of technology validation, enabling organizations to adopt emerging technologies faster.
  • Rapid product development: DPW offers full scope for developing, modeling, prototyping, creating, and delivering creative digital experiences for end-users using artificial intelligence (AI) models, synthetic datasets, and ready-to-use APIs. An Integrated development environment (IDE) is also available for browser-based experimentation. DPW also allows organizations to integrate product backlog for the agile development while offering integration with organizations DevOps pipeline. This allows a seamless flow from solution development to production.
  • Building transformation ecosystem: DPW’s next-generation marketplace comes with partner and API catalogs along with a cloud-based IDE. This allows organizations like central banks and regulators to set up global digital sandboxes where they can create a network of industry-wide participants that can test innovative financial products, services, and business models.

DPW delivers real outcomes

  • Delivers an 80% reduction in turnaround times required for development of solutions thereby enabling rapid development of feature-rich, white-labelled financial products.
  • Integrates the innovation process with the end-to-end product development journey thereby removing departmental silos and enabling smoother collaboration internally and externally.
  • Exposes 40M+ production-like data records as APIs, allowing businesses to quickly test for scale and functionality in a secured environment.
  • Develops new revenue pipelines by working with specialized firms in accounting, corporate finance, and SME lending to co-create products for new markets.

Virtusa’s DPW allows organizations to easily develop and browse through a catalogue of pluggable user journeys that can be quickly integrated into production. It also allows users to browse a list of problem statements posted by partners in the ecosystem, discover third-party APIs and explore detailed documentation and “Try-Outs.”

Once a service has been selected, DPW brings together various components to assemble innovative banking services which can be brought to market 80% more quickly. As a result, businesses can enhance customer experience and drive business growth. 

Senthil Ravindran

EVP & Head of Digital & Cloud Transformation - EMEA

Senthil Kumar is the Executive Vice President & Head of Digital & Cloud Transformation – EMEA at Virtusa. He is a customer-focused Technology Leader with a proven track record of creating & delivering several award-winning Digital propositions and brings more than 20 years of experience. He has a proven track record of identifying emerging technologies [APIs, AIML, Blockchain] that have the potential to go mainstream and build/inspire assets that provide differentiation for the organization. He is very passionate about building and inspiring high-performing teams that get things done and strongly believes that ideas are easy, and winning is all about Execution at Speed.

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