Voice of the Industry

What's stopping CIOs and CTOs from futureproofing their organisation?

Thursday 14 October 2021 09:01 CET | Editor: Oana Ifrim | Voice of the industry

As business uncertainty continues around the world, Banking Circle has examined confidence levels among financial services CIOs and CTOs, and how they intend to futureproof their organisations

The CIO and CTO post-pandemic perspective

Since the start of 2020, the role of the Chief Technology Officer (CTO) and Chief Information Officer (CIO) has become higher profile than ever before, especially within the financial services industry. Barriers came down, allowing digitalisation to be accelerated overnight so tech teams could quickly implement essential new tech and systems.

Today, as life settles back into something close to what it used to be, organisations are looking at how to use the lessons learnt and strides taken to benefit the business long-term. CIOs and CTOSs need to find the right path to move forward positively, profitably and with a clear focus on the customer experience.

As they embark on this journey, Banking Circle investigated the challenges these experts are facing. We talked to CTOs and CIOs at Banks, FinTechs and PSPs across the UK, DACH and Benelux. The results have been published in an industry white paper: Futureproofing payments tech: The challenges facing CIOs and CTOs  

Confidence in the face of the unknown

It was encouraging to see that more respondents are confident than not, in all areas of responsibility. But extreme confidence is lacking. Just a third (33.7%) of the Payments and Banking sector CIOs surveyed feel ‘very confident’ that their organisations are fit for purpose for the future in terms of investigation and procurement of new systems. Extreme confidence was lower still across other areas of responsibility, including Artificial Intelligence (AI) and Machine Learning (ML), data security, new systems migration and training. 

Overall, confidence was somewhat higher for CIOs of PSPs and FinTechs than for those working for Banks; perhaps reflecting the innovative foundations of PSPs and FinTechs, compared to legacy tech often encountered by those working in Banks. This was underlined by the fact that just a quarter of Banks said they are ‘very confident’ about existing systems maintenance, compared to 37% of FinTechs.  

To get systems and procedures ready to take on a post-pandemic future investment is needed, and it is needed now. When asked how investment plans have changed since the start of the pandemic, respondents confirmed that planned investment has increased in all areas of responsibility. Offering a superior customer experience, as well as being able to compete effectively, were the main factors driving increased investment.


Figure 1: Source: Banking Circle white paper:  Futureproofing payments tech: The challenges facing CIOs And CTOs

The ‘buying’ vs ‘building’ debate

To meet their new objectives and futureproof their businesses, respondents plan to spread their budgets across several payment technology solutions, utilising a mixture of ‘buying’ and ‘building’ to suit their specific requirements. Two- thirds are planning to ‘build’ payments tech in-house; the same number plan to ‘buy’ off the shelf. A similar number (65%) intend to outsource or utilise partnerships. 

Perhaps unsurprisingly, given the delays legacy infrastructure can cause, Banks are most likely to buy off-the-shelf (71%). PSPs and FinTechs are most likely to build solutions in- house (70%). FinTechs are also slightly more likely than banks to work with external partners (66%, compared to 64%). 

The payments tech skills gaps 

Another factor that could well be influencing the decision by many CIOs and CTOs to work with external partners is the issue of recruitment. Skills gaps are being highlighted around the world across virtually every business sector, and payments is no exception.  

The area in which the fewest CIO and CTO respondents were ‘very confident’ about their organisation’s readiness for the future was recruitment. This lack of confidence is a concern because 60% hope to increase the size of their payments IT team in the coming year.   

The most common gap was in cloud skills, where 60% of FinTechs and PSPs lack experienced team members. Artificial intelligence (AI) and machine learning (ML) was close behind at 53%. Interestingly, though, when asked which were the most crucial skills for their teams in the next year, just 39% of PSPs and FinTechs included cloud skills in their top three; the same percentage cited AI/ML.  

Figure 2: Source: Banking Circle white paper:  Futureproofing payments tech: The challenges facing CIOs And CTOs     

Whilst the new prominence and accountability of the CIO and CTO role weighs heavily on their shoulders, the burden of responsibility doesn’t need to fall entirely on the in-house team. Working in partnership with external providers can ease the burden by spreading the load. A payments bank or financial utility partner can take on a lot of the heavy lifting and reduce stress on any one individual or team.  

To discover more of the survey findings, download the white paper here: Futureproofing payments tech: The challenges facing CIOs And CTOs     

About Anders la Cour  

Chief Executive Officer of Banking Circle Group, Anders la Cour used his experience in legal M&A and venture capital, and strong commercial acumen, to co-found Banking Circle in 2013. In 2018 he orchestrated a USD 300 million management buy-out with EQT and secured a Banking Licence in 2020. Anders is the inaugural Chair of the Emerging Payments Association EU, having been on the EPA Advisory board since 2016. He is regularly invited to speak and present at industry events around the world, has won multiple awards and had thought leadership articles published in a range of industry publications.  

About Banking Circle  

Payments Bank, Banking Circle, is a fully licenced bank, free of legacy systems. Banking Circle is a modern correspondent bank committed to building a local clearing network for all major currencies, to deliver the fastest, lowest cost payments. Bespoke, flexible, scalable and futureproof solutions enable financial institutions to help their customers transact across borders in a way that was previously not possible. 

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Keywords: Banking Circle, fintech, banks, customer experience, Global Payments
Categories: Banking & Fintech | Payments General
Countries: World
This article is part of category

Banking & Fintech