In an interesting conversation with Bfsinxt.com, senior technology leader and former Chief Information Officer at HDFC Life shares his thoughts on how he views 2022 and the evolving digital trends in the financial services space. According to him, Life Insurers were already on a digitisation journey and those decisions were just a matter of time getting approved and seeing business cases.
Covid-19 fastened the process and accelerated the process across financial services and not only in the insurance space. The whole digital journey has taken a different path itself. Earlier tier-3 cities adopting digital was difficult, but now it’s normal and a huge behaviour change, he said.
Premium payments via digital channels have scaled fast, and overall, the entire industry has adopted and managed pretty well. Covid-19 provided a spurt to the existing digital plans, taking a couple of months or quarters in a typical scenario. ROIs were not really a metric in the last two years but more of survival. As we advance while new initiatives are being run across the board, challenges like legacy stack remain.
The underlying tech has not much changed and requires a lot of work that needs to be done. So that’s one area where I see a lot of companies going to the drawing board and trying to fix the digital journey end-to-end.
On Fintechs, Thomas believes Fintechs are solving the frictions in the financial services space and solving the system’s inefficiencies. Many BFSI firms have started investing in start-ups and are watching them closely, with some ideas where they view it as an opportunity and some ideas that threaten them and, going forward, might buy it off. This has happened globally and has also started playing it out in India.
Five years ago, Fintechs entering into niche areas or getting a banking license was not believable, but things are moving in that direction now. If you see, India is a large and diverse market, and there’s ample opportunity for everyone to do something.
The role of the digital architect in the last few years of the digital wave has got sidelined. The role of an enterprise architect is different as he understands digital architecture too, and he’s the person who should stitch the digital journeys and stick to the core too.
Digital teams broadly talk about the UI journey. What needs to be seen is how core systems respond. There are multiple pillars of architecture that support the user journey and experience. To a lot of extent, they have been ignored, and it needs to be well-documented, and guidelines are maintained. Hiring for this is challenging, but organisations need to embark on this. While digital and all are good, security risk has also enhanced over the last few years as organisations have started relying on open-source software to enable digital. It is essential to note that agility comes with a certain responsibility, which can’t be ignored.