COVID-19 is accelerating the digital transformations of broker-dealers and other financial services firms, who expect to continue accelerating their technology investments as a result of the pandemic, according to the findings of a new Broadridge Financial Solutions study released Tuesday.
Almost all of the C-suite executives from 500 firms surveyed for The Broadridge Next-Gen Technology Pulse Survey said they expected changes to their operating models and next-generation technology strategies as a result of the pandemic, according to Broadridge.
Just 1% of those polled said they didn’t expect to make any changes, Broadridge said. However, only 10% of those surveyed said they expected a high degree of change requiring large-scale changes. In comparison, 45% of those surveyed said they expected to make a moderate degree of change, and 44% expected to make only a few minor changes.
In the next six months, financial services firms plan to focus on increasing cybersecurity and risk management more than any other tech changes, with 63% of those surveyed citing that, according to Broadridge. That was followed by enhancing multi-channel client communications (60%), improving customer engagement and experience (53%) and making significant cost reductions (45%).
Previous investments the firms made that they said were most helpful in managing the pandemic were interactive digital technologies (defined as digitizing customer and employee experiences, workflows and operations), which was cited by 72%, and cloud technologies, cited by 59%, Broadridge said.
Many firms have “reprioritized” their investment strategies due the pandemic and businesses may never return to the old “normal,” and that leaves firms with “little choice but to accelerate their digital transformation,” according to Broadridge.
While 58% of those surveyed said they planned to boost their investments in interactive digital technologies, 54% said they planned to increase their investments in artificial intelligence and 49% said they expected to improve their ability to quickly gather and analyze data moving forward, Broadridge said.
The pandemic also changed the role of fintech service providers, with 70% of respondents stating that fintech providers’ ability to offer innovative uses of next-generation tech was now more important due to the pandemic, Broadridge said.