Predictions 2017: What financial services executives can expect
As the seasonal hit song declares, it's the most wonderful time of the year: The time when Forrester outlines its predictions for how the world will change in 2017.
In the financial services space, we believe that leading firms will focus on improving customer journeys, while laggards will get distracted by bright and shiny technologies. A gap is emerging between the financial firms that are embracing digital business transformation and those that continue doing things the same old way. Forrester predicts that this gap will only grow wider, as leading firms will experiment with new ways to win, serve and retain customers. According to our 2017 predictions, Forrester believes that:
Leading providers and fintech firms will partner to build ecosystems. Dynamic ecosystems of value threaten traditional, vertically integrated financial firms that want to stick with the old-school value chain. But ecosystems also offer opportunities to financial providers that think carefully about the roles they want to play in the ecosystem -- and by extension the role they want to play in customers' lives. Pioneering financial providers like BBVA have built ecosystems with fintech firms like OnDeck, and we predict that in 2017 more leading firms will follow suit and build dynamic ecosystems of value.
The impact of PSD2 and other regulations will ripple across the globe. European banks and payments companies will spend much of 2017 preparing for the second phase of the EU's Directive on Payment Services (PSD2). Providers will use application programming interfaces (APIs) to meet these needs as they innovate to counter the threat from disruptors. Firms outside the EU, meanwhile, will watch closely to gauge the results as companies innovate, enable more open API access, and start the shift to real-time payments.
Incumbents will consider new business models, but take little action. Many financial services execs now recognize that sustained growth and long-term success will require business transformation, but their actions demonstrate little appetite for fundamental reinvention. In 2017, this will begin to change as a small cluster of pioneering firms experiment with new service models, new revenue streams, and new business models.
To learn more about what Forrester expects next year, visit http://forr.com/predictions2017 to download our free 2017 predictions guide that covers the top 15 dynamics that will shape the future in the age of the customer.
Peter Wannemacher is a senior analyst at Forrester, serving ebusiness and channel strategy professionals. Follow Peter on Twitter: @P_Wannemacher.