The Importance of Digitalization during Crisis: Adapting to the New Market Reality
Digital solutions can provide a safe way for consumers and businesses to manage their day-to-day tasks during crises without compromising their health or safety. As a result, businesses have to adapt to the new demand for digitized services in order to stay relevant.
April 9th, 2020. The pandemic has taken its toll on consumers, as well as businesses, by changing the way people work, shop and spend their free time. Digital solutions, such as delivery applications, contactless payments and mobile banking, have become a go-to option for consumers in need of a way to efficiently manage their daily tasks, yet remain as safe as possible during the COVID-19 crisis.
A study by Kantar has found that people are expecting businesses to step up during the pandemic, provide reassurance about the future and help consumers adapt to the new way of everyday life. As more people are practising social distancing, many of their daily routines now rely on the online world. Therefore, businesses are focusing on implementing and upgrading digital solutions, which would enable them to keep up with the rising number of consumer expectations without compromising the quality of service.
Since the start of the pandemic, the usage of mobile apps has extremely increased in a variety of industries. Food delivery and grocery shopping applications, in particular, have witnessed a surge of clients. In the US alone, such apps have experienced a 15 percent increase in total sessions compared to the weeks prior; other major European markets have also noticed a significant jump in usage. As governments are imposing more safety policies by the day, it is highly likely the increasing trend will continue in the weeks to come.
People being bound to their homes have had a notable impact on e-commerce too, as shoppers have directed their attention to virtual markets. Without the opportunity to visit their favorite brick-and-mortar stores, consumers expect online accessibility to the items of interest. Consequently, digital shopping has become an important solution for mitigating risks related to virus transmission as it eliminates face-to-face contact.
Contactless payments have become an important factor for protecting health, as banknotes are known carriers of viruses and bacteria. Individuals, who are not able to purchase certain services or goods online, are encouraged to use such payments to reduce exposure to possibly compromised surfaces. Therefore, banks, seeking to adapt to the situation at hand, are increasing the previously set transaction limits. Examples like this emphasize the importance of having a well-working system that enables to implement necessary changes and swiftly adapt to the new market demands.
The banking industry has also noticed some of the radical changes in consumer behavior: as more people started to self-isolate, the demand to take care of one's financial needs online has skyrocketed. As a result, banks have shifted their attention from the traditional way of business and started focusing on expanding their online banking options. Anton Zujev, Head of Business Development at Fininbox, says that this migration to the digital channels was to be expected, and recent events have only emphasized its necessity.
“The importance of digitalization has never been clearer. Firstly, traditional banks may not be equipped to handle this surge of clients, as legacy systems could crumble under such increased loads,” stated Mr. Zujev. “That’s why digital banks have a major advantage in the matter: as the information is stored on cloud-native technology, it provides the capacity to carry out financial operations without compromising the quality of services being delivered.”
Fininbox, a banking SaaS provider, has already developed a product – Contomobile – that uses their digital bank solution and requires only 4 employees to run the operations. This white-label solution simplifies the adaptation of cloud technology and is available for companies that want to go digital. In addition, digital banks can contribute to the containment of the pandemic as it requires fewer people to supervise its performance, which significantly reduces the risk of transmission.
The current events have forced many to adjust their daily routines by shifting focus to the online world. Businesses, seeking to adapt to the situation at hand, should utilize the opportunity to implement novel solutions that would enable them to meet the new market demands. As stated by Mr. Zujev, “companies with a strong focus on developing and deploying digital solutions, especially during this time, are most likely to come out on top.” Therefore, remaining proactive during this time of uncertainty could be key to a successful business recovery in the aftermath of the pandemic.
Fininbox is a Banking Software as a Service (SaaS) provider for electronic money and other financial institutions. The company provides its all-in-one banking system on a flexible basis: software, IT infrastructure, support and development. Part of Forbis group, Fininbox leverages the group’s decades-long experience in developing banking software to enable financial institutions with a trusted and customer-friendly banking system that is feature heavy and fully scalable at a much lower cost than a system built and maintained in-house.