Banking Innovation - What's The Same, Different, In Developed & Developing World? | Get Financial Freedom Tips | Transform Your Financial Future


Tuesday, July 24, 2018

Banking Innovation - What's The Same, Different, In Developed & Developing World?

The biggest paradigm shift that the banking industry is making under the term innovation is going digital. The new innovation trends talk about how digital-only banking will prevail and mark its name all over the banking and finance industry. It will positively influence customers and industries. 

The overall operational cost of running the digital banking system (once established) is considered lower than that of the banks run by legacy players and workers. So far, banking innovation is turning out quite useful for the business industries that are present in the developed countries. It offers effective financial management services and helps the businesses succeed. But when it comes to the progress of this system in the developing countries, we see that some areas are doing better than others while some are lagging behind in the revolutionizing process. Open bank account in Dubai ownership seems to be rising and so does that of South Asia. But on the other hand, developing regions like Africa still have a slow innovation pace.  

banking innovation

Thus, the question that arises here is whether the developing and developed countries are experiencing the changes in the banking system at a similar pace, or are they different in both worlds?

Banking innovation in the developed and developing world:

The differences in the administration, growth and innovation of the industry and economy of the developed and the developing world are quite evident. This makes it clear that the banking innovation in both the worlds is different as well. 

How do different factors affect banking innovation?

While we are on the same point, let’s have a look at the factors that make banking innovation in both the worlds different:

1.Differences in the markets:

The products, sales of these brand products, market shares and the business progress has a direct effect on the innovation of banking procedures and working schemes. As the state of business progress and customer lifestyle standards in the developed world i.e. Australia, the UK and Hong Kong are way too different from the countries like Bangladesh, rural China and Sri Lanka; it is impossible to have same level of innovation in the banking domain. 

2.Customer needs and standards:

The populace of developed world is more into banking and using online services, and ATM machines to get their work done while the majority of developing populace is still unbanked. When it comes to innovation in these worlds, the ed world looks forward to utilizing the technology in a more advanced manner to grow their banking industry whereas the developing world makes efforts to come to a level where all the people have bank accounts and they are eager to experience the internet banking. 

3.The presence of telecom and payment advanced infrastructure:

There are multiple channels through which banking transactions are facilitated. They are phones, ATM machines, credit cards, use of PayPal, POS terminals and other modes of internet banking. All the rich and developed countries seem to have these channels and are looking forward to improvising them. On the other hand, these basic banking and communication channels are missing in the world that is still struggling to develop their economy and meet the basic demands of the populace. 

The innovation in the banking, finance and communication represent more of a lavish lifestyle of the developed countries. The lack and underdevelopment of these channels in the developing countries show that the struggle to innovate the banking system is more of a developed world trend. The populace, businessmen and banking industry in the developing country is still thriving to meet the basic needs of their fields.

About the writer: Mona is presently working with business consultants in Dubai (Riz & Mona). During her six-year writing career, she has written on almost every niche. Her capabilities lie in producing fine writing pieces on bank, finance and business niches. She also deals with bank account opening, visa processing, trade license, trade mark, local sponsors and product registration.

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