The battle to be the first with innovative technology is not the only fight taking place in the financial services sector, the struggle for talent is hotting up, too.
Over the past few years, there has been a significant rise in fintech start-ups giving birth to a new breed of digital challenger banks. These are essentially tech companies offering banking services. While this is a positive for the consumer, it has created staffing issues. Legacy banks are now having to compete with newer, more flexible and often more forward-thinking institutions for staff with relevant experience.
Moreover, as the established banks seek to modernise their legacy systems and move to more digitally focused environments in order to keep up with their newly created peers, their skill requirements are changing. This is putting them in direct competition with the new wave of emerging banks, tech start-ups and financial providers.
One of the main problems for the existing banks is how to retain their technical employees. The increase in demand for such talent and skills has caused a spike in salaries and legacy banks are having to make counter offers to retain key staff members and knowledge. In addition, in order to expand their technical expertise, banks are being forced to widen their search and source talent from sectors outside of the banking industry that are more advanced in their digital journey. The push for change and innovation in order to keep ahead of the competition emphasises the need for new skills, and management are now having to rethink their strategies on workforces and how to integrate new skills into their current and future plans.
As with elsewhere in the financial sector, the key driver in talent selection is now much more about technology and less about having banking knowledge and experience. Hiring and integrating key technically focused employees into the business is a must. One catalyst for this is how banks interact and offer services to their clients. User experience and customer satisfaction are becoming increasingly important and banks are, for the first time, having to consider how their clients want to engage with them. This is fuelled by the demand for apps and ease of transacting, which allows customers to play a bigger part in the banking process.
Some banks are seeking to overcome these challenges by partnering with – or acquiring – fintech companies. So far, the focus has largely been on businesses involved in payments or transacting systems, but the potential for future collaboration is vast.
With the influx of new technologies into the market, it is also necessary to recognise the impact and strain on resources from outside the banking and fintech sectors. Banking employees are also being hired by the likes of Amazon, Facebook, Google and Apple, all of whom are working on ground-breaking concepts and technologies which many tech-savvy individuals will see as a more attractive working environment than some of the legacy systems operating within the banks. Add to that the increased salaries now being paid outside of the banking sector and the battle for talent is very definitely ‘on’.
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