Innovation in Financial Services:
New technologies help the banks to make sure to overhaul their operation and to bring more new
ways of serving their clients. Over the past few years, Banks innovate new solution to the old
problems them transformed the financial service industry from the payments types to the online
banking or to save options for financial assets or to techniques regarding the risk involve in
investment’s etc. Summerfield, R (2021). Frame and White (2014) surveyed the literature on
financial innovation by discovering 39 empirical studies, which includes innovation in financial
services on such activities that are internally to the bank cost and risk better meet the needs and
help them ease in getting service, they also broadly group the innovation in financial services into
new products such as automated teller machine or ATM, credit cards, debit cards, mortgage,
automation, MRP development, telecommunication, securitization of loans, cross-selling financial
services, automated credit scoring models and so on, They also segregated the banks into new
organization forms such as internet-only banking, interstate banking, diversified banks with
traditional and non-traditional financial services, mobile banking, etc.
To enable new services and capabilities, financial services businesses must embrace the
opportunities presented by innovation and further integrate disruptive technologies such as
artificial intelligence (AI), sophisticated analytics, robotics, the cloud, and blockchain. According
to Gomber, P & K J, Robert (2018) The Fintech approach is the new innovative model in the
financial industry, sharing economy will become more thoroughly integrated with financial
services, and the majority of products and services will be digitalized and delivered via technology
platforms. In the last few decades, innovation has gotten a lot of attention, and many definitions
have been presented to capture the spirit of it. Researchers and practitioners are still working to
reach an agreement on a formal definition of innovation Garcia & Calantone (2002). To become
more innovative, changes must be made at the highest levels of the business. It has been stated
many times that huge, mature organizations lack sufficient inventive capacities, and that the two
have a love-hate relationship.
Impact of COVID-19 on Customer Practices:
The COVID-19 epidemic, as well as the lockdown and social separation laws, have impacted
consumer buying and shopping behaviors. Customers are learning to adapt and develop new
behaviors J, Sheth (2020). The global economy in general and international trade in particular have
suffered massive losses due to coronavirus epidemic. This epidemic created different uncertainties
in many businesses such as financial services, which allows the customer to shift demands, and
change behavior of markets actors M, Leach (2021). Many businesses faced rapid transformation
during the quarantine period as a result, ultimately the corona crisis accelerated the innovation in
digital banking in banking industry. Wanasida, A.S (2021). A new digitally immersed customer
has evolved globally, one who is more discriminating and has financial difficulties. Banking and
financial markets firms all across the world are mobilizing and taking actions to reduce COVID19's impact on their daily operations. Businesses are putting their business continuity/contingency
plans to the test, which include split work sites, working from home, and rotating shifts for all
types of staff, including traders Ensign, R.L (2020). Many banks are also behaving responsibly by
extending loans to hard-pressed borrowers, renegotiating credit terms, and even distributing face
masks to their customers. Financial institutions and equity markets must remain hypervigilant in
addition to the operational steps now undertaken. They must also assess the financial, risk, and
regulatory compliance consequences of the ongoing ambiguity surrounding COVID-19 in the
short- and medium-term Wilson, E (2020).
REF:
Elliot Wilson, “Coronavirus is cost and opportunity for Asia’s banks,” Euromoney, March 2, 2020.
Rachel Louise Ensign, Liz Hoffman, and Justin Baer, “Wall Street scrambles to harden virus
defenses,” Wall Street Journal, March 1, 2020.
Wanasida, A.S.; Bernarto, I.; Sudibjo, N.; Purwanto, A. The role of business capabilities in
supporting organization agility and
performance during the COVID-19 pandemic: An empirical study in Indonesia. J. Asian Financ.
Econ. Bus. 2021, 8, 897–911.
Leach, M.; MacGregor, H.; Scoones, I.;Wilkinson, A. Post-pandemic transformations: How and
why COVID-19 requires us to
rethink development. World Dev. 2021, 138, 105233.
J, Sheth (2020) Impact of Covid-19 on consumer behavior: Will the old habits return or die?
Journal of Business Research Volume 117, September 2020, Pages 280-283
Garcia, R. and Calantone, R. (2002) A critical look at technological innovation typology and
innovativeness terminology: a literature review. Journal of Product Innovation Management 19(2),
110–132.
Frame, W. S., White, L. J., 2004. Empirical studies of financial innovation: Lots of talk, little
action? Journal of Economic Literature 42 (1), 116–144.
Peter Gomber, Robert J. Kauffman, Chris Parker & Bruce W. Weber (2018) On the Fintech
Revolution: Interpreting the Forces of Innovation, Disruption, and Transformation in Financial
Services, Journal of Management Information Systems, 35:1, 220-265
Burgelman, R.A. and Sayles, L.R. (1986) Inside Corporate Inno-vation. The Free Press, New
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