Innovation in Banks and Financial Institutions

Banks and financial institutions play a major role in the stabilization of the economy. The generic roles of banks are associated with managing growth, development, business operations, financial security and managing inflation. However, they do much more, far more than many people realize. This means that they should be at the center of rebuilding economic reforms. It has been the growth of financial institutions that has spawned the careers of many successful business analysts.

Change through communication

Banks and financial institutions were at the main stage when the fiscal crisis struck. After a lot of analysis, it was purported that banks and institutions need to improve on their communication strategies.

The idea is to give priority to channels that are derived from performance rather than cash. There’s also a need for more transparency in order to gain the trust of the people. A term being used to discuss the new models of communication is known as dynamic threat landscapes. This is pretty similar to early prediction programs where the people are made aware of the potential risk of the business. The premise here is that if the risk management system can be made better than more secure business inflows can be created.

A related improvement in communication is for the role of fiscal policies. People should be made aware of the impact of the fiscal policies beforehand. This is where banks are important, because they understand the fiscal system better than anybody. Evidence for this can be known from the fact that the banks had identified a problem with deregulation and suggested that it can lead to fiscal crisis.

Improvement is also being made on the front of metrics and analytics for better economic functioning and financial security. The objective of this improvement in communication is based upon the fact that the changes or the functioning of the banks be made clear so that people can understand the impact of what they are doing.

In the case of investment banks, new systems are ranking categories based upon risk. In this way, analysts can predict the workings of stocks, ETFs, high profit commodities. The point is to increase the public knowledge about important aspects like bonds and stocks. For instance, people should be able to differentiate between an Expert Bail Bond and a surety bond.

The newer form of communication is also focused on using the benefits of technology for driving growth and development. Through the evolution of technology, financial institutions have developed by leaps and bounds. Previously, the model of banks was based upon divergent initiatives, but in light of the recent crisis, a convergent initiative has been developed. The complexity of the banks is being catered to as a result.

With more information influx, it is possible to financial institutions to address previously unmet needs of the public. Even in a deregulated market, the banks should monitor their parameters and the impact that their activities would leave. This is being managed by cross channel communication where cause and effect analysis is being carried out.

The bottom line is that through innovation in communication, the negative aspects of the banks and financial institutions can be catered to. More intelligent the communication, the more productive the market is going to be for the public.

 Photo credit
About Christopher

Comments

  1. Would be interested to know your thought on the specific role of different types of regulation in order to innovate. Great insight.

Speak Your Mind

*