Benjamin Hermanns founded the fintech Fintus in 2016 out of a passion for changing and digitizing the financial industry. In the online series #getinspired, he tells us why Fintus consistently relies on a low-code approach and how the fintech can support banks in their core banking transformation.
(Published on geldinstitute.de on 04/23/2021) Financial institutions and digitization: rarely a love story. Decision-makers realize that their core banking systems are cumbersome, over-complex and outdated. Customers are increasingly critical; they expect automated processes, fast decisions and digital currencies – and simply switch to another provider if they are dissatisfied. Banks urgently need to modernize their IT in order not to be completely left behind by emerging fintechs and neobanks in the age of digitalization.
But given the Herculean task and high risk that replacing the core banking system would represent, banks often stick to existing systems. The press-generated core banking system changes of the past 24 months give little reason to hope for a wave of modernization. Quite a few managers feel that their concerns have been confirmed. And no IT department in the world wants to end up in a similar situation. So is it all or nothing?
Financial institutions can stick with their core banking system and still go digital. The IT systems have grown with the banks over decades, are adapted to individual requirements and have their raison d’être. So why replace them completely? This is precisely the attitude with which . approaches digitization in banks, offering them a real alternative to all or nothing with its modular, standardized SaaS solution.
Success with low-code instead of a mammoth project
With manageable resource and IT expenditure and successful integration of the specialist departments, proven processes within the existing systems and along the entire customer lifecycle can be digitalized and automated in a targeted manner. Whether it’s digital application lines, technical review and approval, monotonous inventory management or partially digitized customer care – in order to be able to act more agilely and efficiently in day-to-day business, manual processes must be eliminated as far as possible.
The keyword manageable IT effort is central here, because speed and precision at the same time are required for restructuring. Time-intensive individual developments and large-scale projects are classically opposed to this. This is why Fintus consistently relies on a low-code approach. Together with the open system architecture, this provides the necessary flexibility and speed in the integration of the holistic process platform.
What the financial institution’s existing IT environment looks like is irrelevant. Standardized APIs that can be flexibly extended enable seamless integration into the existing IT landscape and immediate use. To ensure that the overview is never lost, Fintus Suite bundles all existing applications and information, including documents, within a single interface – the digital workplace.
Standardize, digitize, automate
Before manual processes are automated, they must be put to the test. Often, at the beginning of a restructuring project, there is no documentation of the existing processes, or it is outdated. In this case, the processes must be analyzed, reorganized and redesigned if necessary, and then transferred to a standardized modeling language, BPMN (Business Process Model and Notation).
The result is, above all, generically usable reference processes. In this way, financial institutions lay the foundation not only for sensibly digitizing and automating their existing processes, but also for keeping the effort involved in introducing new products to a minimum. Time-to-market can be massively reduced by this approach.
Banks need to understand: Digitization is not an end in itself, but serves to meet customer expectations. For example, demand for corporate loans to cover short-term liquidity bottlenecks increased dramatically during the Corona crisis. The duration from application to loan decision often takes weeks for more complex financing – time that entrepreneurs often do not have. There is still significant room for improvement here in making the lending process more digital, more automated, and thus faster and more customer-friendly.
With modern processes and connections to relevant data interfaces such as Schufa, rating agencies and KYC providers (Know Your Customer), the process for private and commercial customers can be shortened to just a few minutes. In addition, the entire exchange between customer and credit institution must be possible digitally during the application process. This not only ensures customer satisfaction, but also relieves the burden on employees – especially in times of home offices – which in turn avoids incorrect credit decisions in view of the high workload.
Digitization and automation of their own processes ultimately help them avoid being left behind by the competition and losing market share. Instead, financial institutions are positioning themselves in this way to continue to offer their customers fast, agile and flexible solutions in the future. Employees benefit from the high level of automation – and at the same time from the digital workplace, which brings together the original information research in one application.
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