The digital world is only growing in strength, and this is not lost on the financial sector, with the increasing rise of fintechs competing alongside traditional banking. How banks are approaching FinTech in a responsible way as they feel this competitive heat and how the future of digital finance intersects with risk management is an ongoing topic of conversation. As a result, the implementation of digital transformation led programmes has been seen across the industry to better serve digital products and services to customers.
More recently, there has been a huge emphasis on digital assets and crypto which has been widely disputed as a speculative currency. How financial institutions meet evolving customer expectations to stay ahead of the digital banking game, whilst weighing up the risks in assessing crypto volatility is an area that is being increasingly explored. Whilst crypto and digital banking is still seen as an emerging risk, it is one that is taking up more and more time and focus for risk managers across the industry. Banks need to stay competitive, but the question of acting responsibly and having a sense of caution prevails. Weighing up the risks of digital currencies has become more prevalent for risk managers, who need to assess their volatility in an already volatile market. It’s a market that is evolving at massive speed and managing both the opportunities and challenges is key for risk managers looking to shape the future of banking.