Unified communications and collaboration (UC&C) is in the forefront of enabling change in financial services. Whether it is in distributed delivery of financial services, the rise of new channels and modes of engagement, agile operations, or meeting new regulatory guidelines, digital transformation succeeds with UC&C. Financial services firms with better visibility and control over their UC&C environment become masters of change and transformation.
Download a PDF version of the IDC InfoBrief: Unified Communications and Collaboration in Global Financial Services
Where UC&C becomes mission critical
The new normal for banking, finance and insurance organizations is pushing them to rely more heavily on UC&C systems and services. In the process, service assurance of UC&C services is being redefined.
Americas: User and customer experience more critical than ever
COVID-19 has changed the way financial organizations operate. Digitization and remote working are transforming unified communications management from a nice-to-have to a business essential.
- According to IDC’s U.S. Enterprise Communications Survey, 75.4% of respondent organizations are taking or considering a hybrid approach to deploying UC&C.
- 43% of UC&C users and intenders indicated that videoconferencing and web conferencing are their top priorities.4
- Collaboration application spending by U.S. organizations is projected to increase by 34% to over $10 billion in 2020.3
- UCaaS or managed communication solutions adoption among U.S. organizations is projected to grow at CAGR of 9.24% to over $11.48 Bn by 2024.3
Regulations and compliance
- Storage of daily trading records of all trade activities and electronic communications, for a period of 5 years, in a secure archive.
- Record retrieval and submission within 72 hours of regulators request.
- Implementation of surveillance procedures to monitor market manipulation and insider trading.
Sheer rise in transactions and interactions
The increase in digital adoption and usage amid 2020’s great disruption calls on financial services firms to proactively monitor all interactions to ensure a consistent customer experience.
- One out of every 4 individuals checks his or her online bank account daily, making customer experience a must.1
Data heavy
Gaining customer intelligence based on actual real-time data from the customers themselves.
- 40% of banks are aggregating data to provide personalized support through call centers.1
Impact to investments
Optimizing IT investments by keeping a close tab on cost-to-income ratios.
- 80% increase in open banking spending by banks in America between 2017 and 2020.3
New customer focus delivered by distributed teams
Adopting a distributed ecosystem while delivering a seamless development and support framework.
- 42.6% of bank executives said that by the end of 2020, working from home will be added to their HR policy.4
New modalities of customer interactions
Remote digital engagements like self-managed transactions, pre-staged interactions, co-browsing, consent-driven interactions, and advice- and recommendation-driven interactions.
- More than 65% of customers use remote channels to apply for or open a new bank product or service.1
- 40% of customers cite security as the major reason for constraints in adopting mobile banking.1
1 IDC Financial Insights’ U.S. Consumer Banking Channel Preference Survey, 2019
2 IDC Quarterly UCC View 2020
3 IDC Banking IT Spending guide 2020
4 IDC COVID-19 Impact on IT Spending Survey
Asia Pacific: User and customer experience more critical than ever
COVID-19 has changed the way financial organizations operate. Digitization and remote working are transforming unified communications management from a nice-to-have to a business essential.
UC&C vendor revenue in Asia Pacific organizations is projected to increase by 17% to over $8 billion in 2020.1
Organizations in the Asia Pacific region are increasingly adopting UCaaS or managed communication solutions, with spending projected to reach over $2 billion by 2022.1
In the Asia Pacific region, the sum of units/lines/licenses/seats for managed/hosted voice/UCaaS technology will grow by over 35% in 2020.1
By 2020, Asia Pacific UC&C revenue is expected to grow by 38% to over $3.8 billion.1
Regulations and compliance
Across the Asia Pacific region, regulators have laid down stringent procedures for data capture, privacy, trade surveillance, and timely detection and action on suspicious matters. There has also been a significant increase in regulatory reporting and record-keeping requirements of customer onboarding interactions, especially since the emergence of the pandemic.
Sheer rise in transactions and interactions
The increase in digital adoption and usage amid 2020’s great disruption calls on financial services firms to proactively monitor all interactions to ensure a consistent customer experience.
- Digital loans as a percentage of total Loans for Southeast Asia for the period of 2019–2023 is expected to increase four-fold by 2023.3
- By 2020, 25% of data is expected to be generated, processed, and consumed on a real-time basis.3
Data heavy
Gaining customer intelligence based on actual real-time data from the customers themselves.
- 48% of respondent organizations are focusing on customer engagement and data value strategies.2
- 65% of banks are aggregating data to provide support through call centers.2
Impact to investments
Optimizing IT investments by keeping a close tab on cost-to-income ratios.
- Financial organizations in the region expect to achieve a cost-to-income ratio of <38% for their digital operations.2
New customer focus delivered by distributed teams
Adopting a distributed ecosystem while delivering a seamless development and support framework.
- By 2022, 45% of business-to-business (B2B)/business-to-consumer (B2C) enterprises in Asia Pacific (excluding Japan) (APEJ) will exploit smart personalization for context-based customer engagement by utilizing artificial intelligence (AI), big data and analytics (BDA), and conversational computing.2
New modalities of customer interactions
Remote digital engagements like self-managed transactions, pre-staged interactions, co-browsing, consent-driven interactions, and advice- and recommendation-driven interactions.
- By 2021, 30% of in-branch transactions across Asia Pacific will be pre-staged on digital platforms and fulfilled at self-service kiosks at the branch.2
1 IDC Quarterly UC&C Qview 2020
2 Southeast Asia and Taiwan — Digital Financial Services Rapidly Rising 2020
3 IDC FutureScape 2020
Europe: User and customer experience more critical than ever
COVID-19 has changed the way financial organizations operate. Digitization and remote working are transforming unified communications management from a nice-to-have to a business essential.
The adoption rate of UC&C by employees in European financial institutions is between 50% and 74%, a rate that is rising quickly due to COVID-19 as employees embrace unified communications for remote collaboration.1
Key priorities of respondent financial organizations while implementing UC&C: security (44%), mobility (38%), integration of unified communications platforms (30%).1
55% of employees in European financial institutions use PCs and laptops to access UC&C solutions.1
In Europe, more than 35% of organizations use a video platform for live webcast/internal communications.1
Regulations and compliance
- Financial services firms are required to record all voice and electronic communications that relate to actual or intended transactions.
- Data must be stored for at least five years (seven years in certain cases). Additionally, it should be retained in a durable medium that can be easily accessed by regulatory authorities.
- Companies found noncompliant with MiFID II risk fines of up to €5 million, or 10% of their global turnover.
Sheer rise in transactions and interactions
The increase in digital adoption and usage amid 2020’s great disruption calls on financial services firms to proactively monitor all interactions to ensure a consistent customer experience.
- The digital-only customer segment in Europe is expected to double to over 38% by 2024.3
- By 2024, more than 85% of customer banking interactions will be serviced by remote channels.3
- 76% interact with a bank through digital channels weekly or daily.2
Data heavy
Gaining customer intelligence based on actual real-time data from the customers themselves.
- By 2024, ~75% of European customers will prefer to use a digital channel to open an account.3
- 55% of European consumers will change where they bank, if they are not satisfied with the overall digital experience.3
Impact to investments
Optimizing IT investments by keeping a close tab on cost-to-income ratios.
- 55% of bank executives surveyed said IT spending is directed towards customer attraction and maintaining related technologies.4
- More than 40% of banks’ IT priorities are for real-time payments and deposit automation.4
- 57% of banks surveyed cited cybersecurity; governance, risk, and compliance (GRC); and fraud as their top middle- and back-office investment priorities.4
- 44% banks will invest in API management platforms.4
New customer focus delivered by distributed teams
Adopting a distributed ecosystem while delivering a seamless development and support framework.
- More than 50% expect working from home to be added or expanded in financial organizations across the region.1
New modalities of customer interactions
Remote digital engagements like self-managed transactions, pre-staged interactions, co-browsing, consent-driven interactions, and advice- and recommendation-driven interactions.
- 45% are willing to trade personal information for better terms.2
1IDC Enterprise Communication Survey 2020
2IDC Consumer Banking Channel Preference Survey 2019
3IDC’s European Consumer Survey, 2019: Expanding and Growing Retail Banking Relationships
4Transformation of European Banking — Part 1: Digital Road Maps and Spending Trends in 2020
Middle East & Africa: Customer focus critical amid digital growth
Like other parts of the world, accelerated digital usage has financial services organizations in the Middle East & Africa prioritizing UC&C for consistent customer experience.
20% of senior executives surveyed are prioritizing their UC&C workloads on cloud.1
$200 million is the projected application development and deployment spending for 2020 by distributed teams within Middle East and Africa banking and insurance organizations.2
67% of respondent organizations’ short-term priority is to enable their business executives with more tech-enabled collaboration and engagement.3
Customer experience related spending will grow by over 40% in the region, anchored by customer communications and collaboration.2
Regulations and compliance
Financial industry regulators across Middle East and Africa have laid down regulations around digital record keeping of all actual or intended transactions with customers as well as inter-bank dealings. Digital record keeping is also an integral part of the service charter of banks.
Sheer rise in transactions and interactions
The increase in digital adoption and usage amid 2020’s great disruption calls on financial services firms to proactively monitor all interactions to ensure a consistent customer experience.
- To manage increasing digital growth, 50% of CIO respondents in the region plan to accelerate existing DX efforts to meet new customer and operational agility needs.3
Data heavy
Gaining customer intelligence based on actual real-time data from the customers themselves.
- 48% of respondent organizations are focusing on customer engagement and data value strategies.1
Impact to investments
Optimizing IT investments by keeping a close tab on cost-to-income ratios.
- With a focus on cost optimization, banks’ incremental spend on automation is projected to grow at a compound annual growth rate (CAGR) of 40% between 2017 and 2025.2
New customer focus delivered by distributed teams
Adopting a distributed ecosystem while delivering a seamless development and support framework.
- Prioritizing employee experience for remote work and productivity is the goal of 70% of respondent organizations in the region.3
New modalities of customer interactions
Remote digital engagements like self-managed transactions, pre-staged interactions, co-browsing, consent-driven interactions, and advice- and recommendation-driven interactions.
- 46% is the projected CAGR on open banking related IT spending by banks in Middle East and Africa banks between 2017 and 2025.2
- 52% CIO respondents emphasized building new applications that enhance the digital or online experiences of customers and employees.4
1IDC COVID-19’s Impact on Public Cloud Services Across the Middle East, Turkey, and Africa
2IDC IT Spending Guide 2020
3IDC COVID-19 Market Impact Survey, META
4IDC’s ICT Market Outlook for the Middle East, Turkey & Africa (META)
Mission critical everywhere
Across many segments in financial services, UC&C is now crucial in delivering a new way of financial services.
- Supporting Open Banking
Where unified communications is extended to Open Banking by allowing functionalities, applications, and data to trusted third parties.
- New customer engagement models
Where financial institutions launch new modalities of customer engagement which include elements of prestaging, self-direction, collaboration, and proactive outreach.
- Building a more agile business environment
Where business agility begins with a new wave of intra-organization integration and collaboration: DevOps, DataOps, risk-finance integration.
- Enabling new business models
Where banks move into advisory services, building new business models away from interest income to fees and commissions by providing recommendations, facilitation, and lifestyle platforms.
- Enterprisewide Insights
Where the enterprise becomes one as data, insights, and actions can be standardized across multiple units and silos across the organization.
- Empowering people
Where it is about institutionalizing new modalities of staff work which include elements of automation, pre-staging, intelligence – all with collaboration at the core.
Emerging trends impacting UC&C management
As financial services organizations continue to invest more in UC&C systems and services, the need to have better control over the UC&C environment, and the user and customer experience, is critical.
- Integration of business processes and apps is quickly becoming a core requirement (APIs, ecosystems, and Internet of Things [IoT]).
- Demand for hosted/cloud-based solutions is rising while hybrid implementations are gaining traction. There is a growing sense of comfort with cloud at the enterprise level.
- Emphasis is on use cases, including customer experience, simplicity, and ease-of-use.
- Equipment is outdated, with user dissatisfaction with the current system.
- Lines of business are more active in technology discussions, and are a growing influence on IT budgets.
- There is tight integration of video with UC&C environments, with WebRTC gaining traction.
- Mobile and remote office workers are driving demand, but true FMC/mobile UCaaS remains nascent.
- Team collaborative apps integrated with AI/ML capabilities enable new intelligent solutions, not just to improve productivity but rather to transform the modern workplace.
- Migration from TDM to VoIP is happening gradually.
- Shifting emphasis on solutions, not siloed products.
- Services meshes and application-layer network services will be deployed in more than 70% of cloud-native environments by 2023.
- By 2022, more than 50% of new WLAN, SD-WAN, and UC deployments will be managed via cloud-based platforms.
- Driven by the need for detailed analytics and visibility, the enterprise spending on network monitoring will reach $2.8 billion by 2024.
- By 2022, nearly 40% of enterprises will leverage cellular connectivity, including LTE and/or 5G, in their campus networks to support traffic growth from IoT.
- By 2023, more than 50% of financial organizations will adopt a proactive posture to network operations.
UC&C service assurance still has challenges
Banking, insurance and securities investment organizations face a slew of regulatory and operational challenges as they strive for better business and communications outcomes.
Still found wanting in many organizations
UC&C challenges
Real-time monitoring & alerting
Real-time visibility into each UC&C user’s experience, and actionable performance information for faster issue resolution.
End-to-end visibility
Ensuring realtime visibility, trouble-shooting, and reporting across multi-vendor platform, network, and endpoint environments.
Multiple vendor
The ability to better manage complex workflows of multiple applications/devices, hybridcloud, and multi-vendor UC&C environments, with ease.
Outside-in Testing
Proactive testing of UC&C environment to gain comprehensive insights into the performance, availability and quality to maximize the customer experience.
Regulatory compliance
Call recording to ensure quality management and to support compliance requirement.
Historical analytics
Historical analysis to improve user experience and to support management, and decision-making.
Creating empowered financial services organizations
Ensuring secure and scalable communications
The global COVID-19 outbreak has forced financial services firms to strengthen their digital resilience by offering better remote support to both employees and customers by provisioning secure and scalable communications and collaboration tools and applications.
Empowering the contact center
Going digital doesn’t negate the human touch. Improving contact center capabilities is an ongoing imperative to positively impact remote interactions and response times to ensure client satisfaction.
Beyond the technology
The goal is to add value to the business and address organizational issues, such as building the workplace of the future, integrating communications with applications, enhancing collaboration among lines of business, and addressing customer churn.
Six components of UC&C management to deliver true business value to financial services
Prospering amid new working realities of the new normal
Gain visibility and insights to enhance customer experience, to support employee engagement, and to comply with regulatory guidelines.
Pursuing communications and collaboration goals with confidence
Instead of relying on the tools that come built into enterprise applications, financial services organizations are deploying full suites of network monitoring and management solutions that deliver proactive and reactive responses in real time.
Message from Sponsor
IR’s Collaborate solutions for communications and collaboration empower organizations to proactively find and resolve performance issues in real time, to deliver a superior user experience across on-prem, cloud or hybrid environments.
Monitor, Alert & Identify issues proactively with visibility across your entire UC ecosystem.
Troubleshoot & Diagnose the root-cause to proactively prevent sudden and recurring issues.
Analyze & Report on performance over time to understand trends, adoption and usage, and make informed business decisions.
Test your communication and collaboration environments to deliver exemplary customer and employee experience.
Some of the world’s leading financial institutions rely on IR for:
- UC System Performance
- Contact Center Performance & Operations
- Voice and Video Quality
Assured Customer Satisfaction
Ensure the quality of your service. Have confidence that customers have a good interaction with your organization to aid customer satisfaction and retention.
Enable Remote Workforces
Deliver a reliable, highly-available communication and collaboration environment to facilitate technology adoption and employee productivity, anytime anywhere.
Maintain and Optimize IT Efficiency
Improve IT flexibility and agility. Adapt to evolving requirements and deploy new technologies faster to ensure business continuity and maximize the potential for success.
Download a PDF version of the IDC InfoBrief: Unified Communications and Collaboration in Global Financial Services
