The ever-increasing pace of technological advancement has unleashed a lot of powerful forces in societies around the world. One of the forces that are changing the way financial consumers form business relationships is transparency. All across the world there is now a greater thirst for transparency than ever before. Technology is responsible for both increasing this thirst for transparency and for giving financial firms the tool to meet the demands of their customers.
Greater Understanding of Technology’s Possibilities
One of the ways technology is driving the demand for transparency is through exposure. Every year more people come of age that are not only comfortable with the internet, but they have never experienced a world where virtually any desired piece of information wasn’t instantly available.
More financial services customers understand and are comfortable with technology. Part of this comfort means they understand what technology is capable of. They know that things like data mining, algorithms, AI, and blockchain can be used to not only enhance decision making but also to make that process more transparent.
The technological knowledgebase of financial consumers will only grow stronger in the coming years.
Awakening to Power of Transparency
Independent of the ways technology makes transparency possible, more and more financial consumers are seeing a need to transparency in all of their interactions from banking to shopping to politics.
Corruption scandals, cybersecurity breaches, and poor decisions by high-ranking financiers have eroded public trust everywhere in private financial institutions. Many believe that a major cause of the Great Recession was a lack of transparency.
Investors and financial consumers are particularly sensitive about a lack of transparency in the entities they do business with. They believe that greater transparency will result in better returns for their money and more accountability for the institutions they trust their money to.
Transparency as a Competitive Advantage
Because the technology to make financial transactions secure and transparent exists and is relatively easily implemented, financial consumers are clamoring for financial services firms and companies to be fully transparent. The technology is increasing the thirst these consumers have for transparency.
The financial services space is hyper-competitive. Firms are often scrambling for any small advantage they can get. However, the biggest competitive advantage for financial firms in today’s market is to simply be transparent.
Even though the demand for transparency is clear and the technology already exists in the marketplace already exists to meet this demand, many firms are slow to implement any meaningful changes.
Companies that are committed to making truly making their customers happy are deploying technologies like blockchain to make sure their customers get the transparency and the security that they want.
Generational changes, technological advancement, and recent experience mean that the current demand for greater transparency from financial companies will only grow stronger. The companies that meet this demand early on are poised to grow quickly, disrupt more traditional firms who refuse to adapt, and to become industry leaders.
We are entering an environment where investors will make transparency a high priority on their due diligence checklists and they will richly reward the firms who are ready to meet their demands.