Innovation and trust add appeal to traditional banks

For the world’s largest and most established banks, digitization is not a destination. Rather, it is a continuous and dynamic process of change and innovation that must adapt to the latest technologies, customer needs, and economic trends.

And while the digital transformation of retail banking may focus on improving the customer experience through applications and online services, in the parallel world of corporate and investment banking, it is just as important to empower customers with new data.

As Yvan Mirochnikoff, head of digital solutions at Societe Generale Securities Services (SGSS), told PYMNTS in a recent interview, digital transformation is a “cornerstone of our sales strategy,” a plan designed along two different axes. , said.

As in retail banking, the first vector of digital transformation is customer experience, where SGSS implements digital tools and platforms to maintain customer relationships in a connected economy.

“The second axis is data access,” he added, explaining that the days of emailing PDF documents are long gone. These days, he said, customers prefer to have direct access to data so they can incorporate it into their own systems.

As Mirochnikoff noted, whether information flows through an application programming interface (API) or some other means, the general trend is for banks to create a “self-care environment” that their customers can directly access to data in real time.

In fact, “we are [increasingly] deal with what we call self-care services, giving our clients more ability to [service] themselves with more autonomy and with more efficiency,” he said.

Growing demand for ESG data

Beyond the way customers access data handled by SGSS, the types of data they require are also evolving.

Mirochnikoff said that as companies and fund managers look to diversify their investments into more sustainable assets, the need for environmental, social and governance (ESG) data has grown.

Sometimes this data is highly structured and therefore easy to collect and work with, he said. But often, it is unformatted and difficult to process.

To meet this challenge, he said SGSS first has to build new models and share them with its clients. But it’s still an ongoing process, he added, especially given the evolving regulatory landscape governing ESG investing.

More generally, creating products that give its clients access to new asset classes is central to SGSS’ development strategy. And to ensure it’s prepared to deliver new services as investment trends evolve, Mirochnikoff noted the bank’s adoption of a multi-year timeline for research and development.

Building Digital Trust

According to Mirochnikoff, more and more investors want to diversify into newer assets, such as cryptocurrencies, and this will mean introducing these types of asset classes in a way that builds “a bridge between traditional finance and new finance,” he said.

Last September, for example, SGSS launched a new service for asset management firms wishing to incorporate cryptocurrencies into their portfolios, allowing the European bank to now act as custodian, appraiser, and liability manager for cryptocurrency-exposed funds. .

In the end, Mirochnikoff said it all comes down to trust. While there are many ways investors can buy and manage crypto assets today, they turn to established and regulated players like Societe Generale because “we bring this trust to the customer already [their] investment management company.”

Furthermore, in the wake of a tumultuous year for the cryptocurrency industry, culminating in the collapse of the popular cryptocurrency exchange FTX last November, investors are looking for safe and reliable partners.

And while some European cryptocurrency exchanges are betting on low-risk custody solutions to lure jaded users, Mirochnikoff insists that banks have a critical role to play in building much-needed trust in the space.

“It is very important that a traditional bank like us [is] paving the way [and unlocking] innovation [around] this new class of assets with all the guarantees that it works and that it is safe”, he said.

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