The Top Banking Trends of 2023 (Donica Venter)

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The banking industry is constantly evolving and adapting to new technologies and customer needs. As 2023 begins we explore the trends that will shape the future of banking. Here are the top banking trends for 2023:

Increased Adoption of Digital Banking

With the rise of smartphones and mobile devices, more and more customers are turning to digital channels for their banking needs. “This trend is expected to continue in 2023,” says Ludik, with more banks investing in fintech, digital tools and platforms to make banking easier, more affordable and more convenient for their customers.”

This trend, in turn, will see the continued ascension of Neobanking and the emergence of non-banks such as insurers and MNOs that offer banking solutions through Banking-as-a-Service strategies.

A Greater Focus On Customer Experience

In the past, banks were primarily focused on the bottom line and were not as concerned with providing a positive customer experience. However, this is changing as customers demand more personalized, seamless experiences from their banks. “In 2023, we can expect to see banks investing heavily in technology and data analytics to better understand their customers and provide more tailored services and experiences,” says Ludik.

The (Continued) Rise of Open Banking

Open banking is a new mandatory approach to banking that allows customers to share their financial data with third-party providers, enabling them to access a wider range of services and products. “Through the course of this year, we can expect to see open banking become more widespread,” says Ludik, “with more banks and other financial service providers adopting this model to offer more innovative financial services.”

More Emphasis On Data Security

With the increasing digitisation of banking, data security is becoming a top concern for both banks and customers. “This year, I expect to see banks implementing more advanced security measures and technologies to protect customer data and prevent fraud and other security breaches,” says Ludik. “Furthermore, banks will look more to trusted partners and suppliers that have world-class security accreditation and practices for support.” 

Increased Competition From Fintech Companies And Challengers

In recent years, a combination of emerging fintech companies and non-banking corporates have been challenging traditional banks with innovative products and services, based on EMI licences. “This trend is expected to continue this year as fintech companies continue to grow and attract more customers,” says Ludik. “Banks will need to innovate or partner with leading Fintech software providers to stay ahead of the curve and offer competitive products and services to remain relevant in the market.”

A Significant Shift To Sustainability

With growing concerns about the environment and climate change, we can expect to see a heightened focus on sustainability in the banking industry in 2023. “This trend is being driven both by consumer pressure and by the banking industry’s desire to drive positive change,” says Ludik. “Activities could include the development of enhanced products and embedded services that support sustainable practices, as well as increased efforts to reduce the environmental impact of banking operations.”

Increased Use Of AI And Automation

Artificial intelligence (AI) and automation are transforming the banking industry, allowing for faster and more efficient processes. “While many of these technologies are still in their infancy, we can expect to see a significant increase in the use of AI and automation in various areas of banking,” says Ludik. “The main areas where this is likely to happen are in the analysis of big data to drive fraud detection and risk management. Other applications could be in the area of customer service, with many banks already utilising chatbots, while another use case could be in personal finance management and credit scoring.” 

In summary, the overarching trend is that Fintech innovations will continue to have a significant impact on the banking sector through 2023.

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