The COVID-19 pandemic triggered digital transformation across several industries when the traditional ways of functioning gradually made way for a variety of new ways of working.

For example, the way money changed hands has declined from the physical and unhygienic exchange of currency notes to contactless payments.

While at a local level, it took years for vendors to understand, initiate, adopt and enjoy the ease of money transfers, organizations facilitating these services knew that it was just a matter of time before the sea change at the local and global markets. Digital transformation of the evolving market has made domestic and overseas transactions faster and cheaper, bringing in more convenient options.

While net-banking, UPI transfers and mobile payments have become increasingly popular, experts believe that in the coming years, service providers will embrace blockchain-based secured transfers, bringing in further innovation and disruption to the market.

The importance of UX in payments transformation

“If we look at the February data by Research and Markets, money transfer volume is expected to grow 12.58% annually to $339.87 billion in 2030. The main drivers behind this will be innovations in FinTech and mobile banking. The global digital remittance market has transformed over the years to a mostly transparent, quick and easy one from being expensive with hidden fees attached. Newcomers in this market are forcing banks and financial organizations with outdated business models to adapt their technology and platforms to offer competitive rates to global customers,” says Arghadeep Mondal, Consultant – Technology Enablement, KPMG India, speaking exclusively to HCLTech Trends and Insights.

“What matters now is how user-friendly an interface is, whether it’s a banking app or a digital payment wallet. If you look at the users’ average age bracket, seven of 10 people are millennials who prefer online transactions. In less than seven years, this age group will rule the market in leading positions. Therefore, changing traditional ways — with an easy UI for better and enhanced UX — can only keep you ahead in the race,” he adds.

However, when it comes to analyzing user experience with a better and easy user interface, simplicity and easy access are two very difficult areas in terms of designing an app or a website that could help a user with one-tap solution or helpful gateways.

“The screens, toggles, icons, buttons and other visual elements that a user interacts with while using a website, an app or an electronic device don’t always bring in the done-with-ease factor. These experiences change the rating of such an interface and create a bad impression among people. With devices now becoming smart, lots of apps interacting with IoT-enabled devices do not really support the way a user wants it to,” says Soham Dutta, UX analyst at a leading tech firm, speaking to HCLTech Trends and Insights.

“This is where designing a good UX matters because the entire interaction you have with a product, including how you feel about the interaction focuses on having a deep understanding of the users’ needs and behavior, what they value, their abilities and their limitations. Along with voice commands and interactive [artificial intelligence] AI, what matters now is how easily an organization meets the business goals and objectives with enhanced UX,” adds Dutta.

Challenges ahead

In addition to UI and UX, service providers will be challenged to deliver faster transactions at lower costs while developing robust security measures to protect data and transactions as threats continue to evolve in more sophisticated forms.

“Apart from making these financial organizations cyber-resilient, what becomes necessary at this phase is how easily technologies like blockchain and AI are embraced by such a company. Transactions based on this distributed ledger technology are secure and transparent, eliminating intermediaries, while smart contracts have the potential to streamline settlement and compliance. Blockchain will eventually revolutionize this market with reduced costs and increased speed and security. At the same time, there are many banks that are already using AI to automate tedious tasks, delivering better outcomes. For example, investment banking automation,” says Mondal.

According to a McKinsey report, automation and AI are likely to address 10-25% of work across all bank functions. This will multiply capacity and allow employees with free bandwidth to concentrate on higher-value projects. Many banks are deploying cutting-edge automation technologies to deliver the next wave of cost savings, improvement in user experiences and enhanced productivity.

By leveraging innovations, such as mobile banking applications and digital wallets, individuals who were previously underserved by traditional banks can now access a wide range of financial services with just a few taps on their smartphones. This includes services like money transfers, payments, savings accounts and even small loans.

With advancements in AI and automation, while banks can now provide more sophisticated services to clients like automated trading algorithms and risk management, human intervention is required for ethical and regulatory compliance.

At the UK’s recent AI safety summit, new research suggested that an AI bot performed illegal financial trades and covered it up without telling the firm, reported the BBC.

“Regulatory compliance and integration challenges related to existing systems and cybersecurity risks are therefore areas financial organizations need to investigate while reaping the benefits of next-gen technologies. These benefits may start with automation, which brings in increased efficiency, significantly streamline processes and reduce manual errors. They can then further expand to enhance customer experience, improve decision-making and deliver cost savings,” says Sanjoy Ghosh, Executive Vice President, ERS at HCLTech.

In this landscape, HCLTech has been delivering best-of-breed technologies, clubbed with its digital and engineering capabilities, to enhance customer experience across the globe. This ranges from building a suitable platform to designing an easy app or a user-friendly and helpful website.

For example, a leading American multinational financial services company that provides a platform for international money transfers embarked on a comprehensive digital transformation journey to enhance its business operations.

The client was facing multiple challenges, including outdated legacy technology, lack of an omnichannel vision, absence of content management capabilities and extended time-to-market. Their existing platform struggled to handle surges in traffic, which resulted in occasional performance degradation.

“HCLTech developed a well-defined strategy to help the client achieve its business goals effectively. The strategy included omnichannel transformation, migration of 44 applications to AWS, enabling effective monitoring of all US and international sites, mobile apps, partner apps and reviewing the current system’s capacity and identifying choke points to make the system more resilient and efficient by performance tuning the platform,” adds Ghosh.

With a cloud-first, technology-led and managed operations approach, HCLTech empowered the client with a modern digital platform. “This interface enables multiple channels and use cases with the API-first approach, threefold increase in digital revenue, improved user experience, expanded functionality and seamless integration of digital services resulting in over five million app downloads. This ensured faster adoption, wider reach and multifold increase in new user registrations across regions,” adds Ghosh.

Equitable design

Ghosh believes that platform-based business models enable companies to build sustainable ecosystems with a technology foundation, which is inherently designed to drive growth.

Building a successful digital platform is based entirely on how easily others can plug into the platform to share and transact with others, internally or with supply chain and ecosystem partners. This will determine if the platform attracts valuable producers and consumers.

To make the platform more relevant to the business, its effectiveness also depends on how well it fosters the exchange and co-creation of value and takes into consideration the various data dimensions such as customers, product and verticals.

“As pointed out by Mr. Ghosh, designing a seamless payment experience isn't just about convenience, it’s also about fostering inclusion and empowering users. Equitable design ensures that everyone, regardless of their background or abilities, can navigate and utilize these tools effectively. By crafting behavior-forming products, we create a financial ecosystem that empowers individuals and fosters economic growth for all,” concludes Dutta.