With the emergence of financial technology (fintech), companies are expected to offer more financial services to personalize their customer journey, enhance the overall user experience and generate alternative revenue streams. Provenir, an artificial intelligence-powered decision-making platform, believes that integrating start-up business operations with artificial intelligence (AI) and efficient data management could trigger "a fintech revolution" that will transform industries in the country. This holds true with the growth of the local fintech market, which has seen a significant valuation increase by 224 percent from $3.4 billion to $11 billion in 2016 to 2021, indicating that Filipinos use at least one fintech service every second. As mobility restrictions amid the ensuing pandemic constantly result in strong demand for digital services, businesses need to "adapt themselves at a very high speed," according to Provenir General Manager for Asia-Pacific Bharath Vellore. "AI in fintech opens the doors for the digitalization of credit-rich verticals and diversifies products and capabilities. Agility and speed in personalization play critical roles in providing personalized offers to customers, aiding in hypergrowth," he said during a recent forum.

It used to be like this: people need banking services, bank provides services, people get services. The relationship between brick and mortar banking and their customers has a history of being dry, one-sided and purely monetary. Times are changing though and this paradigm is going through a major transformation. The digitization of the banking process has lent itself to the creation of a new medium of communication between bank and customer. Customers no longer have to walk into a physical store to manage or get answers regarding their finances.

The banking and financial sectors are on the brink of a fundamental structural change. Compliance regulations have kept these industries trapped in long-overdue legacy systems. Yet, senior executives understood that they need to make a shift towards integrating more technology into their daily operations. This decision is motivated by costs, efficiency, perception, and evolution. The current buzzword which is credited to be a catalyst for the financial sector's revolution is AI.

David Gyori, CEO at Banking Reports, outlines the biggest issues affecting banks today and outlines what he believes the bank of the future will look like. What are the biggest challenges facing retail banks today? There are four major strategic challenges banking executives have to solve simultaneously: low-rates; overregulation; the fintech revolution; and millennials. Each of these challenges are opportunities as well. Even though permanently low rates decrease the profitability of major incumbent banks, they also enhance operative efficiency, cost-consciousness and productivity and these things will be handy in a later expansionary phase.