# The Four Benefits of Digital Transformation in the Finance Industry
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2021-08-06
Category: FINANCE
Category URL: https://financedigest.com/category/finance
Meta Title: How UK Finance Embraces Digital Transformation: Insights
Meta Description: Discover the key benefits of digital transformation in the UK finance industry, including improved customer experience, better analytics, and customisation.
URL: https://financedigest.com/the-four-benefits-of-digital-transformation-in-the-finance-industryhtml

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Paul Wilson is a consumer finance expert at Financial Conduct Authority authorised credit broker Little Loans. Paul has over 20 years experience in financial services and during his career has witnessed first-hand the incredible impact that a clear digital transformation strategy can have on financial products and services. In this piece, he shares his key findings.

It’s fair to say that the UK [finance industry has very much embraced digital transformation](https://www.financedigest.com/digital-transformation-for-the-world-of-finance-the-rise-in-collaboration-tools-and-saas-applications.html "Digital transformation for the world of finance: The rise in collaboration tools and SaaS applications ") in the past decade. Every high [street bank has an app of some form and open banking and the use of API’s has created greater possibilities for technology to deliver customer benefits](https://www.financedigest.com/a-two-way-street-chinese-investment-in-the-uk-will-benefit-both-economies.html "A TWO WAY STREET: CHINESE INVESTMENT IN THE UK WILL BENEFIT BOTH ECONOMIES"). We have even seen the emergence of online-only [financial services such as digital challenger banks](https://www.financedigest.com/73-of-employees-in-the-banking-and-financial-services-industries-are-looking-for-better-physical-and-mental-wellbeing-support-in-the-workplace.html "73% of employees in the banking and financial services industries are looking for better physical and mental wellbeing support in the workplace") like Starling and Monzo, as well as other online-only financial services such as the loan markets that we at Little Loans we operate in.

There are many benefits that digital transformation has brought to our financial services and the way the [finance industry](https://www.financedigest.com/navigating-consumer-data-in-the-finance-industry.html "NAVIGATING CONSUMER DATA IN THE FINANCE INDUSTRY") operates here in the UK. Below are 4 of the key benefits and how we have seen them improve the [finance industry for customers and businesses](https://www.financedigest.com/1-in-3-uk-businesses-looking-for-finance-are-finding-it-harder-to-get-a-loan.html "1 in 3 UK businesses looking for finance are finding it harder to get a loan") alike.

**Improved** [customer experience](https://www.financedigest.com/curating-a-fully-contactless-customer-experience-for-payments.html "Curating A Fully Contactless Customer Experience for Payments ")

The true digital giants of the current era such as Amazon, Uber and Netflix have changed customers’ expectations of how quickly and conveniently services can and should be delivered, and this shift in expectations has extended to how customers [deal with their finances](https://www.financedigest.com/citi-halted-financing-for-trafiguras-nickel-deals-in-october-bloomberg.html "Citi halted financing for Trafigura’s nickel deals in October – Bloomberg").

Through [digital transformation](https://www.financedigest.com/world-class-finance-digital-transformation-and-analytics-based-decision-making-among-key-imperatives-for-creating-finance-agility.html "World-Class Finance: Digital Transformation and Analytics-Based Decision Making Among Key Imperatives for Creating Finance Agility"), money can be moved around accounts, payments made, and cheques deposited without leaving home. Loan [brokers such as ourselves are able to accept applications and evaluate a customer’s](https://www.financedigest.com/canadian-banks-fighting-brokers-back-for-customers.html "Canadian Banks Fighting Brokers Back For Customers") eligibility in minutes, and the providers we work with are able to approve or decline the loan equally as quickly. This process would traditionally have taken several days and a visit to the high street. This improved spend and customer [experience could only have been achieved thanks to digital transformation](https://www.financedigest.com/transforming-the-banking-experience-to-be-mobile-first-and-people-centric.html "Transforming the banking experience to be mobile-first and people-centric").

**Better [analytics and data](https://www.financedigest.com/data-analytics-scenario-planning-and-the-finance-department.html "Data analytics, scenario planning, and the finance department") analysis**

[Digital analytics has become absolutely critical](https://www.financedigest.com/smarter-safer-stronger-cybersecurity-is-now-critical-to-digital-future.html "Smarter, safer, stronger cybersecurity is now critical to digital future") for financial business. Analytics allows [businesses to learn in granular detail how customers are finding their products and thus evaluate how successful](https://www.financedigest.com/a-female-founders-top-tips-for-success-for-women-in-business.html "A female founder’s top tips for success for women in business") their marketing efforts are proving – this allows for intelligent marketing investment decisions and strategies and helps to ensure that marketing efforts provide maximum return on investment.

Robust analytics data also allows [financial businesses to more accurately forecast and model](https://www.financedigest.com/10-ways-to-make-your-financial-model-easier-to-understand.html "10 Ways to Make Your Financial Model Easier to Understand") expected customers and transaction numbers and make sure that the business strategy is set correctly. And if it isn’t, analytics data can help more quickly identify the [things that are running off course and need](https://www.financedigest.com/4-things-you-need-to-know-about-mortgages.html "4 Things you Need to Know About Mortgages") to be adjusted.

**Better customisation and individualisation**

In the pre-internet era, it could be extremely difficult to provide tailored [offers to customers](https://www.financedigest.com/improving-customer-experience-through-broadening-your-mobile-offering.html "Improving customer experience through broadening your mobile offering"). Mailshots could be wide blast-outs to a large chunk of [customers with the hopes that a certain proportion would engage](https://www.financedigest.com/customer-engagement-trends-that-will-rule-banking-and-financial-services-in-2021.html "Customer Engagement Trends that Will Rule Banking and Financial Services in 2021") with the offer.  Very much a ‘throw mud at the wall and see what sticks’ approach. This wasn’t particularly satisfactory for [customers or companies](https://www.financedigest.com/swiss-insurance-company-helvetia-uses-squirro-to-deliver-better-search-results-to-its-five-million-customers.html "Swiss insurance company Helvetia uses Squirro to deliver better search results to its five million customers") – the former receiving a bunch of irrelevant or unsuitable communications, and the latter wasting money and running the risk of annoying their customers.

But [digital transformation](https://www.financedigest.com/3-reasons-why-businesses-get-stuck-at-the-starting-gate-of-digital-transformation.html "3 Reasons Why Businesses Get Stuck At The Starting Gate Of Digital Transformation") has made delivering customised offers, deals and messages incredibly quick and easy for financial businesses.

Customers can be very simply divided into ‘buckets’ based on the [data a business holds](https://www.financedigest.com/sterling-holds-firm-after-uk-jobs-data-muddies-rate-outlook.html "Sterling holds firm after UK jobs data muddies rate outlook") on them – be that age, location, gender, demographic, past transactions with the business, income, number of dependents – the list goes on. All of this information can make a [big difference in the quality of the communication the customer receives and improve the conversion rate on offers for the business](https://www.financedigest.com/smishing-is-a-new-virus-plaguing-big-business-conversational-commerce-to-the-rescue.html "‘Smishing’ is a new ‘virus’ plaguing big business – Conversational Commerce to the rescue!").

Much of this customisation can also be automated, making for a very efficient process, and can help ensure that the right messaging is [delivered at the exact right time to maximise conversion](https://www.financedigest.com/cavai-and-azerion-deliver-industry-first-with-conversational-in-stream-video.html "Cavai and Azerion deliver industry first with conversational in-stream video").

[**Improved transaction security**](https://www.financedigest.com/what-banks-need-to-do-right-now-to-improve-their-digital-services-without-sacrificing-security.html "What Banks Need to Do Right Now to Improve Their Digital Services Without Sacrificing Security ")

Customer [security has always been a big concern in financial](https://www.financedigest.com/5-steps-to-strengthening-your-online-financial-security.html "5 Steps to Strengthening Your Online Financial Security") services for obvious reasons. [Security failures can lead to financial](https://www.financedigest.com/how-financial-services-are-overhauling-security-to-defend-against-spoofing-scams.html "How financial services are overhauling security to defend against spoofing scams") losses for customers, fraud and data leaks.

Data encryption has vastly improved the security of transactions and [fraud detection](https://www.financedigest.com/the-clues-to-detecting-fraud-are-hidden-in-relationships.html "THE CLUES TO DETECTING FRAUD ARE HIDDEN IN RELATIONSHIPS") systems help to weed out a greater proportion of counterfeit applications or transactions.

[Digital transformation](https://www.financedigest.com/5-key-takeaways-from-the-finance-sectors-digital-transformation-revolution.html "5 Key Takeaways From the Finance Sector’s Digital Transformation Revolution") has changed financial services for the better and given how far the industry has embraced technology in the past decade, there is no doubt that there are still a lot more changes and improvements to come – particularly as emerging technologies such as AI and machine learning continue to grow apace.


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