Merging the IT and financial sectors: Why it is important and necessary

A life without technology is unthinkable today," as Roger Studer, Head of Investment Banking at Vontobel, said last September in an interview with deritrade. The technological progress of recent years has had an enormous influence not only on our lives, but on the entire economic system as well. Businesses in every sector are responding to the innovations in IT. Business models are being adapted to fit the needs of digital-savvy customers. Keyword: digital transformation.

Modern technology is indispensable for customer experience

The financial sector is no exception. In order to keep up with large IT enterprises like Google and Apple, as well as small FinTech start-ups, the financial sector must reposition itself. Reason: investor is mobile, available 24/7 and expects financial technology to be part of the mix. Every bank and financial advisor needs modern technologies in order to provide an up-to-date customer experience. This requires, however, that financial institutions change their internal structure. Technology experts, big data scientists and user experience specialists, for instance, must be more closely integrated into existing corporate structures.

Banks are operating like technology groups

It is a long and rocky road – but banks are aware of the urgent necessity. Lloyd C. Blankfein, former CEO of Goldman Sachs, announced several years ago, "We are a technology company". The fifth-largest US bank strengthened its internal IT expertise very early on by cooperating with several FinTech start-ups. Germany's Commerzbank in turn opened a "digital campus" in Frankfurt in 2016. The goal was to automate business processes through innovation in order to become more efficient. The young technology company Spotify served as a model for this process.

IT has had a high priority at Vontobel since 1999

In terms of digitalization, Vontobel is a pioneer in Switzerland. The bank began directly integrating IT into all of its areas as early as 1999 and now has 20 years of experience keeping pace with customer developments. One example: more than 20 IT specialists across Europe are working on the multi-issuer platform deritrade for asset managers and banks. This ensures that every current technological innovation flows into deritrade's development process.

At FinTechs, the merging of IT and finance is already a reality

Keeping up with customer needs takes more than just a combination of IT and conventional financial core business. FinTechs and other technology companies have long been leading the way by fully merging finance and IT. There are two reasons for this. First, IT is so central to all processes that it should not be a separate department. When financial experts and IT specialists work together in the same teams, products and services can be developed more quickly. Second, IT specialists do more than just developing software – they have a long-term involvement with the business. The financial sector could learn a lot from the FinTechs in this area – only agile and efficient processes can guarantee long-term success on the market.

deritrade is the leading issuing platform for structured products for financial service providers and insurance companies. Are you interested in deritrade or would you like to find out more? Then don't hesitate to contact us. Our experts are there for you.

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Sources

NZZ: Der Mensch bleibt die wichtigste Ressource einer Bank (13.09.2018)
Inside-IT: Schweizer Banken richten Digitalisierungsstrategie aus (11.01.2018)
FuW: Banken-IT-Spezialisten im Hoch (06.02.2018)
Bloomberg: Goldman in Ventureland (25.07.2015)
Frankfurter Allgemeine: Die Commerzbank nimmt sich Spotify als Vorbild (19.08.2018)
t3n: Warum jetzt die Stunde Null der Banken ist (21.09.2018)