Research commissioned by DST finds regulation and data privacy are the chief barriers for firms attempting to understand their customers’ behaviours. Eighty percent of those surveyed, which included 50 financial services executives, cited Data Privacy as a significant concern. C-Suite executives are far more preoccupied with remaining compliant through regulation and safeguarding data. The ability to understand customers is further inhibited by fundamental operational constraints, particularly around organisational and technological silos.
The research showed a general recognition that Financial Services is trailing when it comes to embracing opportunities through digitalisation to service customers better, with those in the retail and even FinTech sectors consistently raising the bar.
Whilst regulation and data privacy remains a key concern for those surveyed, operational barriers are also heavily impacting firm’s capabilities to harness client intelligence. Eighty percent of respondents said customer information is often held in operational and IT systems that reside in different silos within enterprises. The disparity can often be due to heritage or legacy systems that are simply not updated. Attempts to consolidate customer data from this multitude of systems will more than likely result in "data dumps," which are difficult to analyse or from which to draw any conclusions.
When it comes to financial products and services, Millennials shifting from traditional distribution channels to digital access was cited as one of the key drivers for change. Understanding who customers are, where they are on their financial journey, and therefore which products or services would be of most interest to them, will allow firms to fully engage in ways they have been restricted from doing so previously.
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