9 tech challenges facing banks

A host of different factors are intersecting to subtly but distinctly change the way the banking industry will operate in the near future.

Demographic shifts are feeding new customer expectations, which are in turn creating an opening in the market for nonbank competitors and upstart firms. Industry observers now predict that within a decade, the biggest bank will be a technology firm.

A number of recent industry reports have attempted to detail how banks are responding to the challenge, whether through investment, data management or new strategies to engage with customers. But with every step, there are obstacles.

Even as customers primarily conduct transactions over mobile, banks are discovering they still expect branch service to be an option. Traditional apologies for service interruptions may not sit well with a customer base both expecting efficient service and potentially able to choose technology firm offerings as an alternative. And technology investments themselves are up for scrutiny, either because of potential workforce impact, or just the burden of increased costs.

Here is a look at some findings in recent industry studies of banking technology trends.

Young consumers are open to change in financial services. That's creating opportunities for tech firms to consider entering the industry. In a recent global survey, Accenture found 31% of bank customers would consider Google, Amazon or Facebook if they offered such services. Oracle found the same level of readiness among global consumers in its own research.

While big tech firms explore the possibility, upstart fintechs such as Acorns and Robinhood are already trying to take advantage of this sentiment, developing new offerings that can convert their existing personal finance management and investing accounts into checking and savings customers too.