The pandemic forced many industries to rapidly digitize processes, but financial services providers’ digital response stood out. Now financial services providers’ digital platforms are pointing us toward a more diverse and inclusive future.
In a survey of eight industries conducted on behalf of Microsoft by The Economist, financial services respondents were most likely to agree that the pandemic accentuated the competitive edge of digital-first companies.
Among 800 global executives surveyed, those in financial services reported above-average readiness for remote work and collaboration, with streamlined digital processes in place enabling businesses and individuals to pay for goods and services. Financial services respondents were more likely (45%) than executives in other industries (32%) to say the pandemic accelerated the pace of digital transformation.
Financial services survey respondents also said diversity and inclusion will be among the positive societal impacts digital transformation is likely to have on their industry.
How? Technologies like AI and advanced analytics, when used responsibly and in the right way, are one of the ways the financial services industry can better serve our diverse population.
One billion people are living with disabilities globally but only one in 10 people with disabilities has access to assistive technologies and products, according to the World Health Organization. Financial services organizations can integrate screen reading and narration capabilities into their banking products for the vision-impaired and speech-to-text capabilities for those with hearing impairments. Banks can also employ multilingual cognitive tools localized in real time to personalize product or service offerings.
Fairness is another area where financial services providers' platforms can make a difference. If we are vigilant and intentional about creating inclusive technology, then tech will level the playing field. New tool sets, driven by ethical and explainable AI, also allow financial services organizations to reach customers and make decisions about loans, for example, using leading edge technologies that consider factors and data that were historically not used. AI advancements can also help diminish or eliminate inaccuracies or personal errors or opinions in financial decisions like lending.
Technology provides other pathways to address wealth inequality. Digital innovations are giving investment firms, payments processors and tech providers many new opportunities to partner with governments and nonprofits to build data-driven financial tools that empower vulnerable and underserved communities to create financial stability.
In Africa, for example, we are seeing real inroads made in bringing financial services to previously unbanked communities. By using mobile solutions, we can leapfrog limitations of outdated infrastructure and hard-wired lines to brings the internet to underserved populations and expand access to mobile banking.
As an industry, there is still a lot more the financial services community can do, with support from technology vendors, to tackle wealth inequality. One specific area I’m personally involved in right now is the role we can play in supporting community banks here in the U.S., looking at how we can create new opportunities and expand access to much-needed capital for minority-owned, small and medium-sized businesses — which produce the most jobs for African Americans within their respective communities —
through modernized technology.
In many ways, the pandemic has been an environmental wake-up call. Socially responsible investing, aligned to environmental, social and governance (ESG) assets, is on the rise. Advanced technologies will help provide real-time, transparent data that can be used to evaluate opportunities and investments from an ESG perspective. They can help corporate banks recalibrate loan portfolios to differentiate green assets from brown assets. And they can help retail banks create new tools for consumers to manage their carbon footprint and support societal impact.
Also, with more than 10% of the world’s population still lacking access to basic electrical services, fintech innovation can play a critical role in energy inclusion, maximizing the potential of decentralized energy access arrangements and delivering affordable products and services. One example is mobile pay-as-you-go payment methods to facilitate the purchase of modern energy kits for poor households in developing countries.
Financial services organizations began the journey toward digitization years ago, but the pandemic accentuated the urgency and broad benefits of the movement. These survey results underscore how financial services organizations in the post-pandemic era are looking inside their own walls and outside to local and global markets to see what they need to do to create a more diverse and inclusive world.
