Intelligent CXO Issue 21 - Page 30

FEATURE
FINANCIAL INSTITUTIONS NEED TO ACT NOW TO MODERNISE THEIR PLATFORMS AND HAVE AN OPEN API STRATEGY READY TO PROVIDE BAAS . allowing data to be extracted , shared and combined to create new propositions that add real value . Essentially , APIs enable banks to provide access to the data held in its systems to customers or third parties .
What Embedded Finance brings
Banks aren ’ t the only ones to benefit from Embedded Finance though . The concept appeals to both consumers and businesses . From the consumer ’ s perspective , the Embedded Finance model streamlines financial processes via a ‘ one-stop shop ’ approach that makes it easier for people to access goods and services when and where they ’ re needed .
To enable open APIs , banks will need to start from the bottom up , reinventing their core and launching digital-first initiatives throughout their business models , technology stacks , software solutions , strategic plans and more .
Powered by and fully participating in a platform ecosystem of FinTech solutions , modernisation will help banks to build up and out to become full-service partners with access to a complete customer picture that will enrich the customer experience and make interactions with customers more successful , efficient and profitable . With the ability to offer BaaS solutions , banks can also enjoy a rapid expansion of their distribution channels and increased market reach to new customers .
From a business point of view , these innovations allow businesses to reinvent the services they offer customers , making financial services an integral part of the user journey . As an example , we have seen car manufacturers move into the space through embedded insurance . The likes of Tesla are now offering their insurance across the range of vehicles , streamlining the process for consumers and – in some cases – reducing the cost of the insurance overall .
Businesses are seeing that creating a streamlined and frictionless process can boost revenue streams and expand their offering into adjacent services – providing more value for their customers in the process .
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