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Corporate Banking Series, Part 2: Critical Trends in Transaction and Corporate Banking

The business banking / corporate banking services space is being reshaped by a broad range of trends, which are driving fundamental changes:

  • New payment service alternatives, including instant payments and cross-border payments, are lowering barriers to multibank and multi-national transaction services.
  • New digital technology capabilities are lowering the barriers for dynamic and multibank relationships mainly in the areas of onboarding and integration, which have historically prevented customers from using ad hoc transaction banking services from multiple banks.
  • Evolving customer demand requires new capabilities enabled by digital technologies such as artificial intelligence (AI), voice engagements and open APIs. These new technologies are causing a fundamental shift in how banks’ customers want to receive transaction banking services.
  • New technologies such as advanced analytics, cloud computing, microservices, and open APIs are lowering the barriers to entry for banks that want to expand their capabilities to serve new customer segments.

Shifts in Digital Transformation in Corporate Banking

The rapid adoption of digital channels for consumers is influencing and reshaping how banks engage their corporate and business customers.  The spans all traditional areas of how corporates do business with the bank and other entities, i.e. cash management, payments, trade finance, supply chain management, etc.  But digital capabilities are also introducing new solutions that can be offered to business customers to help them better manage cash and risk.  Such an example would be the use of eWallets tied to an app that a delivery driver might use when delivering goods to customers.

While the risk of disintermediation is low between a corporate customer and its bank, there is considerable risk of shifting revenue away to such point solutions in the future. To keep up with these developments, corporate banks need to undertake front-to-back digital transformations.

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