New trends for financial institutions in the post-epidemic era – Financial & Insurance News

New trends for financial institutions in the post-epidemic era

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Digital lending institution SoFi, a favorite of millennials, relocating right into standard financial

The “new crown pneumonia” epidemic as a huge black swan event this year, the world’s economic and social development has had a profound impact. At present, the foreign epidemic is still in the rising stage, the situation is serious, but China’s epidemic prevention and control measures have been achieved in stages, enterprises to resume work and production is steadily progressing. With the orderly return of domestic economic operation to normal, China has gradually entered the “post-epidemic era” of external input and normalization of domestic epidemic prevention and control.
In the “post-epidemic era”, various industries are facing the problem of recovery after the epidemic, and the financial industry has also accelerated the pace of transformation and upgrading, showing some new development trends.
Improving financial technology
During the epidemic, the offline services of financial institutions were restricted, and financial technology and online services were elevated to a strategic level by financial institutions from their previous position of optional, and the recognition of contactless financial services by institutions and users was further increased, which further accelerated the process of digital transformation of the financial industry.
The application of big data, artificial intelligence and other high-tech in the financial sector also directly promotes the improvement of technology level of each financial institution. The integration of artificial intelligence technology with investment advisors, insurance claims, business consulting and other businesses is conducive to enhancing the automation and intelligence of financial institutions’ service processes and helping financial institutions build an intelligent financial system covering the entire life cycle of products; the application of big data technology in accurate marketing, risk management and credit system building can effectively improve the accuracy of financial institutions’ business expansion, enhance the early warning of overdue Cloud computing technology provides the technical basis for remote collaboration, and “cloud meeting” and “cloud collaboration” have become the main form of office for major institutions during the epidemic. The effect of combining these technologies with finance was more obvious during the epidemic.
Tapping into consumer finance scenarios
However, with the resumption of work and production in various industries, GDP grew by 3.2% year-on-year in the second quarter, turning from negative to positive, and other major indicators resumed growth, showing a steady recovery of economic operation. The consumer industry, which has experienced the baptism of the epidemic, has produced new changes and given rise to new consumption habits.
During the consumer home quarantine, many companies realized the importance of digital transformation and shifted their business processes online. Online healthcare and online shopping saw an outbreak, and new online scenarios such as online learning and online offices rode the wave. Consumers’ restricted offline spending power is transferred to online for a concentrated explosion, and the potential of the consumer market is stimulated by the fire of online consumption. In this context, Internet giants and e-commerce giants have accelerated the layout process of credit payment. How to dig deeper into new consumer finance scenarios, seize market share in the new windfall and resist encroachment by other giants has become a new issue for financial institutions in the “post-epidemic era”.
While the consumer finance scenario is changing, the main customer groups have become more complex. The young customer group is more receptive to credit payment and has always been the main customer group of consumer finance. However, due to the impact of the epidemic, many young consumers have increased their willingness to save and their willingness to overspend has weakened to a certain extent. To continue to impress consumers and acquire customers, financial institutions need to further lower the threshold, increase subsidies and concessions, design targeted products according to customer needs, and seize the market with quality products and services.
Optimize the operation and management model
The epidemic is an unannounced test for various industries, testing the risk resistance, organizational stability and operational management capabilities of each enterprise.
In terms of risk control, the stability of risk is the basis for all business activities of financial enterprises, so financial institutions need to regularly conduct stress self-tests to test whether their product structure and marketing model can withstand the downward pressure of assets to smoothly survive the crisis under the scenario of a serious economic downturn. Based on the results of the test, make corresponding adjustments to various nodes such as marketing, access, approval, lending and post-loan, especially for situations where past risk control model strategies may fail during the economic downturn, propose targeted solutions, and do rapid iterations of failed models and data to ward off further potential risks.
In terms of operations, the overall demand for consumer credit fell as a result of the epidemic, and the quality of consumer credit assets decreased and post-loan management became more difficult, requiring financial institutions to have the ability to react quickly, develop prudent business strategies and refine operations.
As for customers, the employment, income and repayment ability of each customer group will be greatly affected during the epidemic, which requires financial institutions to continuously explore the path of deepening user insight, refining operation and management by customer group, making a more detailed customer portrait, screening out a group of high-quality customers with repayment ability and willingness to repay through technical identification at the customer acquisition stage, and implementing differentiated and targeted management measures for customers according to different labels. According to different labels, we can implement differentiated and targeted management measures for customers.
In general, the impact of the “new crown pneumonia” epidemic on the financial industry is profound and long-lasting, and going online has become an irreversible development trend, which has put forward new requirements for financial institutions in terms of digital transformation, online channel expansion, and innovation in customer acquisition and customer activation. At the same time, it is a new challenge for financial institutions to embed financial scenarios into the larger social ecology, dig deeper into transaction scenarios, expand their own service content, and develop products that meet new user needs. In the “post-epidemic era”, the financial industry will definitely develop in the direction of technology, digitalization and refinement. Only by following the trend of the times and continuously improving their technological capabilities and comprehensive operational capabilities can financial institutions stand firm and stand on the tide when risks come again.