# The digital-first world: financial services predictions for 2022 Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2022-01-06 Category: FINANCE Category URL: https://financedigest.com/category/finance Meta Title: Financial Services Industry Predictions for 2022 Meta Description: Uncover the latest trends in the financial services industry for 2022, including the rise of open finance and hyper-personalisation. Stay ahead of the curve URL: https://financedigest.com/the-digital-first-world-financial-services-predictions-for-2022html ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/istock-865226698-2-1736836507576-compressed.jpg) ![](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/david-ritter-1736836507585-compressed.jpg) _By **David Ritter,** Financial Services Strategist at CI&T_ As investment booms, unemployment falls, and Europe’s economy soars, financial institutions are set to enjoy a strong year in 2022. But with consumer behaviour changing post-pandemic, banks will need to adopt new online strategies and escalate their digital transformations to stay competitive in the new digital-first world. To help your organisation prepare for essential innovation, here are my top predictions for the [financial services](https://www.financedigest.com/trends-in-the-financial-service-landscape-and-the-impact-on-fraud.html "Trends in the financial service landscape and the impact on fraud") industry in 2022. **The ongoing** [rise of open finance](https://www.financedigest.com/make-way-for-the-rise-of-the-finance-super-apps-consolidation-of-financial-digitisation-tools-platforms.html "Make way for the rise of the Finance Super Apps – Consolidation of Financial Digitisation Tools & Platforms") The move to digital banking throughout COVID-19 lockdowns will accelerate open finance during 2022 – with customers now much more willing to share their data with third-party apps, [online trading](https://www.financedigest.com/whats-in-store-for-2016-leading-online-trading-services-provider-easy-forex-reveals-predictions-for-the-new-year.html "WHAT’S IN STORE FOR 2016? LEADING ONLINE TRADING SERVICES PROVIDER EASY-FOREX REVEALS PREDICTIONS FOR THE NEW YEAR") platforms, and other non-traditional services. These new consumer attitudes will continue to fuel the [growth of digital challengers](https://www.financedigest.com/retreating-up-the-risk-curve-is-no-solution-to-the-growth-challenge.html "Retreating up the risk curve is no solution to the growth challenge") and provoke a response from legacy institutions. Many Tier 1 banks will [upgrade their in-house data systems](https://www.financedigest.com/sweden-to-upgrade-berzelius-supercomputer-with-nvidia-ai-systems.html "Sweden to upgrade Berzelius supercomputer with Nvidia AI systems") and infrastructures, and begin to launch Banking-as-a-Service offerings to tap into new markets and recover lost revenue. They’ll also begin to sell the benefits of data-sharing to more hesitant customers, explaining how resultant new services can help them to better [manage their finances](https://www.financedigest.com/how-parents-can-help-students-manage-their-finances.html "How Parents Can Help Students Manage their Finances") while demonstrating efforts towards safeguarding consumer information. As open [banking standards such as PSD2 develop and strengthen, the uptake of banking services](https://www.financedigest.com/30-per-cent-of-uk-consumers-would-use-amazon-google-facebook-or-apple-for-banking-services.html "30 Per Cent of UK Consumers Would Use Amazon, Google, Facebook or Apple for Banking Services") for the unbanked and underbanked will grow, too. Fintechs have shown that it’s feasible to [offer basic banking](https://www.financedigest.com/first-abu-dhabi-bank-could-renew-35-billion-offer-for-stanchart-bloomberg-news.html "First Abu Dhabi Bank could renew billion offer for StanChart -Bloomberg News") services to people with little or poor credit history. Traditional [banks will begin to introduce similar services](https://www.financedigest.com/britain-seeks-to-boost-banking-services-from-fintechs.html "Britain seeks to boost banking services from fintechs") in an attempt to grow the market and win back their lost share. **Open-data ecosystems will continue to evolve – albeit slowly** As digital [banking and open finance](https://www.financedigest.com/why-finance-professionals-must-bank-on-a-journey-to-the-cloud.html "Why finance professionals must bank on a journey to the cloud") flourish, businesses will capture huge amounts of data that potentially contains crucial customer insights. To store, sort, and analyse the [value of this information requires access to an open-data ecosystem – but such ecosystems won’t be transforming](https://www.financedigest.com/2021-predictions-realising-the-value-of-payments-transformation.html "2021 Predictions: Realising the Value of Payments Transformation") the financial industry just yet. Unlike other software industries using open-data ecosystems, [financial services](https://www.financedigest.com/how-crowdsourcing-can-help-drive-the-benefits-of-advanced-analytics-in-financial-services.html "HOW CROWDSOURCING CAN HELP DRIVE THE BENEFITS OF ADVANCED ANALYTICS IN FINANCIAL SERVICES") companies are highly regulated, and the data being stored is particularly sensitive and personal. First, [banks and the broader data-sharing ecosystem will need to develop protocols that protect data security and privacy before they focus on customer](https://www.financedigest.com/christmas-debt-hangovers-how-banks-can-help-customers.html "CHRISTMAS DEBT HANGOVERS: HOW BANKS CAN HELP CUSTOMERS") analysis. Consumers trust banks with their [financial data to a much greater extent than other big](https://www.financedigest.com/how-big-data-is-sending-shockwaves-through-the-financial-services-sector.html "How big data is sending shockwaves through the financial services sector") technology platforms, but that goodwill could easily be squandered without proper care. In the meantime, open-data ecosystems will continue to improve to the point when, for [financial institutions](https://www.financedigest.com/3-ways-financial-institutionscan-leverage-live-engagement-on-social-media.html "3 ways financial institutions can leverage Live Engagement on social media"), the wait will be worthwhile. New tools will emerge to help engineers manage and [extract value](https://www.financedigest.com/mussel-extract-market-overview-and-exhaustive-analysis-on-market-segments-supply-demand-value-chain-2022-2029.html "Mussel Extract Market Overview and exhaustive analysis on Market Segments, Supply & Demand Value Chain 2022-2029") from the data faster than ever. And businesses will be able to adopt open-source [data formats, enabling their data to be compatible across programming languages and future analytical](https://www.financedigest.com/data-analytics-scenario-planning-and-the-finance-department.html "Data analytics, scenario planning, and the finance department") tools, removing the need for expensive data transformations. **Hyper-personalisation will become an imperative** With more and more fintech businesses emerging throughout 2022, existing banks will find ways to differentiate themselves from the [competition – and take advantage](https://www.financedigest.com/turning-big-data-compliance-into-a-competitive-advantage.html "TURNING ‘BIG DATA’ COMPLIANCE INTO A COMPETITIVE ADVANTAGE") of new advances in personalisation. [Customers are used to enjoying products](https://www.financedigest.com/sports-and-athletic-insole-market-players-eye-custom-and-3-d-printed-products-for-performance-optimization-says-future-market-insights.html "Sports and Athletic Insole Market Players Eye Custom and 3-D Printed Products for Performance Optimization, Says Future Market Insights") and features tailored to their tastes, from Netflix’s suggested TV shows to Amazon’s bespoke discounts. Now, they expect the same from their [financial services](https://www.financedigest.com/as-hackers-declare-cyberwarfare-financial-services-cannot-afford-to-be-complacent.html "As hackers declare cyberwarfare, financial services cannot afford to be complacent"). For banks, this could mean sending [customers relevant offers](https://www.financedigest.com/any-business-can-now-offer-their-customers-financial-services-how-embedded-finance-is-reinventing-the-wheel-when-it-comes-to-banking.html "Any business can now offer their customers financial services: How embedded finance is reinventing the wheel when it comes to banking") from partnered retailers, offering AI-powered budgeting advice if a user overspends, or even creating loan agreements instantly tailored to meet a consumer’s needs. To achieve hyper-personalisation, banks will upgrade their data foundations and architecture, and graduate to predictive/prescriptive analytics that enable their [services to be customised in a way that resonates with customers](https://www.financedigest.com/id-fraud-is-on-the-rise-can-financial-services-do-more-to-protect-their-customers.html "ID fraud is on the rise: can financial services do more to protect their customers?"). **[Digital upstarts will boost customer experience and industry](https://www.financedigest.com/matching-digital-adoption-with-cybersecurity-in-the-financial-services-industry.html "Matching digital adoption with cybersecurity in the financial services industry") collaboration** Digital challenger banks have revolutionised the customer experience in recent years, with slick interfaces, fast sign-ups, and new [services like commission-free trading of securities drawing masses of consumers](https://www.financedigest.com/do-consumers-want-robo-advisory-services.html "DO CONSUMERS WANT ROBO-ADVISORY SERVICES?") away from Tier 1s. In 2022, incumbents will begin to push back, improving the customer experience for both basic [banking and complex transactions like mortgages by offering speedy self-service tools as standard](https://www.financedigest.com/first-abu-dhabi-bank-reiterates-not-eyeing-offer-for-standard-chartered.html "First Abu Dhabi Bank reiterates not eyeing offer for Standard Chartered") practice. In turn, digitising and [automating these processes](https://www.financedigest.com/how-process-automation-increases-productivity-in-the-insurance-sector-while-giving-employees-room-for-more-high-value-activity.html "How Process Automation increases productivity in the insurance sector while giving employees room for more high value activity") will reduce the manual workloads on back-office staff, freeing up resources to further maximise profit potential. Large [financial institutions will also recruit](https://www.financedigest.com/2016-financial-recruitment-trends.html "2016 FINANCIAL RECRUITMENT TRENDS") chief technology and chief information officers from tech providers and outside industries to unlock fresh perspectives on how to compete with challengers. These new leaders will be more open than traditional bank chiefs to collaboration with outsiders, including rivals, and will push to integrate third-party services into the bank’s suite of offerings to boost [innovation and consumer](https://www.financedigest.com/2021-predictions-less-fraud-shifting-consumer-behaviour-and-accelerating-pace-of-innovation.html "2021 predictions: less fraud, shifting consumer behaviour and accelerating pace of innovation") attraction. [Financial institutions](https://www.financedigest.com/the-future-of-financial-institutions-in-2023.html "The Future of Financial Institutions in 2023") will then transition from building and managing databases – which is very capital-intensive – to agile, cloud-based data architectures and applications. Legacy infrastructure and the inability to [bridge data](https://www.financedigest.com/bridge-the-gaps-in-big-data-and-cross-into-a-world-of-growth.html "Bridge the gaps in Big Data – and cross into a world of growth") systems have long stifled innovation and the customer experience. However, with the influence of tech-centric CTOs and CIOs, [financial services](https://www.financedigest.com/what-can-we-learn-from-financial-services-security.html "What can we Learn from Financial Services Security?") companies will modernise their outdated IT models by embracing cloud migration. As a result, I expect innovation by incumbent [financial institutions](https://www.financedigest.com/what-the-future-holds-for-financial-institutions-in-2023.html "What the Future Holds For Financial Institutions in 2023") to surge throughout 2022 and beyond. --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---