🤔 Despite working closely with the comms team of a digital bank for over a year, it wasn’t until I received a cheque from an older relative at Christmas that I began to understand the true real-world impact of the seismic changes that have been occurring within consumer financial services first-hand.

I realised that my digital and high-street bank did not have the capacity to pay a cheque online, leading to a two-week battle to reach a branch during its opening hours. Could it be that in a matter of years, it’s likely that receiving a cheque will seem as archaic as paying for your morning coffee with notes or coins is quickly becoming?

The way we view money, payments and banking as a whole is undergoing a necessary shift.

Many of us are now fully embracing the benefits that technological changes can bring as consumers and those who work within the very financial organisations we rely on. But, whether we embrace it or not, it’s clear that the impact on our daily lives is massive.

🏦 Being part of the team that helped launch UK digital bank Kroo’s flagship current account to the market and helping them on their mission to change the banking industry for the better has allowed me to recognise one major benefit that the growth of digital challenger banks has had and that is, ultimately, pushing traditional, high-street banks to do better.

Digital banks have been leading the way in what the future of finance looks like while challenging the profit extraction model of high-street banks, which have continually come under fire for not passing interest rates to savers.

Understandably, digital banks are also at the forefront of innovation in banking apps, which means that traditional, high-street banks are being pushed to innovate in this area, too. I think this is a trend which will continue, with digital banks leading the way and affecting positive change in an industry which has had a notoriously bad reputation for being greedy, misleading and, often, quite stagnant, in the past.

AI also presents a world of opportunities for financial services and will significantly shape the way we manage our money in the future. It will allow organisations to tailor products and services to the needs of specific customers and serve them more efficiently but will also be a game changer for organisational colleagues.

It will give them the space they need to focus on value-adding tasks rather than being held back by admin or processes which could better be implemented through machine learning. And, with EPAM Continuum’s 2024 Consumer Banking Report revealing that 96% of consumers are happy with banks adopting and integrating AI to better serve end users, it’s clear that the majority of us are on board with utilising it to enhance our banking experience.

But with great power comes great responsibility, and, as warned by the Bank of England, we must ensure we have the necessary regulation and framework in place to manage these rapid developments in AI. This will ensure we can avoid increases in fraudulent activity and safeguard the stability of our financial systems more generally.

💸 While financial advice at your fingertips and a more tailored approach to banking through AI is exciting for most, one important consideration can be keenly identified in my struggle to pay a cheque. While most Gen-Z and Millennials are now just as comfortable using banking apps as they are scrolling on Instagram, there are still so many who are struggling and will struggle with this blanket move towards digitisation.

We can’t leave anyone behind in our strive for innovation. With bank closures at an all-time high and even cash becoming less accepted at checkouts, it is up to us and those at the helm of financial organisations to ensure that a dystopian future filled with inequality and robots is not realised. At its heart, banking is highly personal, and we must not forget that, nor lose the human touch, which can make all the difference if people are struggling.

The new era that financial services is entering is exciting and filled with endless possibilities, providing more room for collaboration and allowing us to access money and services at our fingertips.

However, we must enter this new age cautiously and with those less savvy in mind to ensure that we have both the structures and the human touch in place to make sure it works for us all, not just the privileged few.

✍️Written by Ashleigh Clark, Consultant at Stand.