Is the Future of Capital Markets Completely Digital?

Capital Markets CIO Outlook | Friday, September 25, 2020

The ability of technology to offer scalability and quick access to insight and information presents an unprecedented opportunity to push capital markets forward in entirely new ways.   

FERMONT, CA: Technology has been dynamically influencing capital markets. Capital market innovation is imperative to help capital market firms survive in the short term, streamlining where necessary, and prospering in the future. Existing working models and ongoing use of legacy technologies will not assist companies in maintaining long-term business. Capital market transformation is a continuing process. Advances in technology enable companies to move forward and distinguish within the capital markets arena. In search of inexpensive operating costs, leading capital market firms will need to move beyond merely thinking about digital, and rethink and repurpose their organization for a fully digitized economy.

There is no doubt that capital markets are being transformed by digitalization. As a consequence, the enterprises are swamped with data, so the challenge now is how to take advantage of new techniques to make the best use of that information. The cloud is undoubtedly a future star. It has already become a significant player promising, through focused projects, dramatic price cuts, and boundless scalability. It can be challenging, however, to strike a balance between effectiveness and data security, leading to the evolution of the hybrid cloud model.

Companies in the capital markets industry need to adopt few organizational standards such as intelligent and automated, data-led and customer-centric, open and accessible, flexible and resilient, standardized, and straightforward to harness this age of transformation's full potential. However, to achieve this, they need to correct their technology strategy. Therefore, banks' resources must focus on generating differentiating capacity in areas that are critical to revenue generation and customer retention.

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The ongoing pursuit of effectiveness, enhancement, and legacy modernization will sweep away ancient legacy architecture, systems, and methods of thinking. To slowly replace legacy IT, create fresh alternatives, and seamlessly integrate new assets with heritage through open APIs and microservices, the globe can see leading capital markets prefer a leaner and adaptive strategy. As technology evolves, the trend within capital markets to accelerate the transition will intensify as the capital markets continue to fight for dominance.

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