Bankers see many advantages to the many technological advances that continue to shape the financial services industry, according to Accenture, but some of the most promising areas of innovation are still being held back by trust issues with third-party partners and fintechs.

The annual Banking Technology Vision report by the global consultancy surveyed nearly 800 respondents at banks in more than 25 countries across North America, Europe, Asia-Pacific, Africa and South America.

Re-connecting to customers
Survey respondents said new technologies used by banks can primarily be used to help recapture customer intimacy, replicating the experience Canadians once got by visiting a human teller at their local bank branch. Most bankers surveyed in Canada (78%) believe digital data will provide a new way to identify market opportunities and unmet customer needs, while 83% of global respondents believe data will offer a more powerful way to understand customers.

“Digital tools can provide banks with new, near-real-time information about their customers and help them identify unmet customer needs,” said Alan McIntyre, global head of Accenture’s Banking practice. “Creating a rich view of customers’ digital and technology-driven activities is a powerful tool that banks can use to get closer to tailoring their products and services to the illusive ‘segment of one.’”

Warming up to open banking?
Meanwhile, open banking, generally thought of as a principle that would allow financial institutions to share a client’s personal information securely with third parties, continues to be a concern for both customers and bankers.

Another recent Accenture survey found that the majority of Canadians (75%) surveyed were wary of banks sharing information, such as account balances, transactions and payment information securely with outside parties like retailers, social media platforms and fintech companies.

But while most bankers in this survey believe customer trust in banks’ ecosystem partners is very or extremely important, only 29% of Canadian bankers say they know their ecosystem partners are working diligently to be compliant and resilient with regard to security.

“Moving closer towards adopting open banking in Canada will mean an increase in the interconnectivity among banks and third parties, which in turn creates additional points of weakness and vulnerability for banks’ network security,” said Bob Vokes, Managing Director of Financial Services at Accenture Canada, in a press release. “Security is only as good as the weakest link within the ecosystem partner network.”

Banking on more disruption
The report identified five technologies it has dubbed “DARQ” (distributed ledger, artificial intelligence (AI), augmented reality and quantum computing) that have, and will continue to disrupt the banking industry.

“Technological disruption is affecting the structure of countless industries. Over the past five years technology’s ranging from social to cloud have transformed financial services and become core to banks’ operating systems,” said Vokes. “As this disruption continues to accelerate it is likely to change the overall structure of the banking industry, and banks will need to evaluate the technologies that are expected to drive the next wave of disruption.”

Nearly half (47%) of all bankers surveyed believe that AI will have the greatest impact on their organization over the next three years. While more than half of Canadian banks surveyed are piloting or have adopted AI in one or more lines of business, 10% are not planning on implementing AI or evaluating it for adoption.