Key Concepts of Decentralised Finance (DeFi)
Key Concepts of Decentralised Finance (DeFi) GDS Modellica27/06/2022With the aim of “closing the gap” between
June 27, 2022
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The pivotal role of the financial system in the post-covid economic recovery
The damage caused by the COVID-19 pandemic has had a domino effect on the economic and financial system. For a robust response to the adverse economic situations and the new challenges in the sector itself, it is vital to have a strong financial system
GDS Modellica’s comprehensive solutions are fundamental for financial institutions looking to make use of innovation, automation and personalisation as a way of handling risks and improving efficiency
Banks have played a key role throughout the pandemic, whether it be by deferring mortgage payments, helping to support consumer spending or any other measures taken with regards to finance, tax or social security to support both families and businesses. All of these steps taken by the government and the financial sector have helped to reduce the socioeconomic impact of the crisis, and it is clear that they have provided some relief for businesses and self-employed workers. But if the uncertainty continues and the economic recovery fails to materialise, with yet another wave of the virus on the horizon, this situation will become increasingly less sustainable. After months of reduced revenue and increasing debt, despite the various support measures taken, many businesses will be unable to cope and will be doomed to close.
In these challenging times, says GDS Modellica, the financial system needs to be resilient to tackle the challenges and seize the new opportunities that emerge from them, offering solutions in collaboration with the government and reinforcing their pivotal role in the economy. According to GDS Modellica, the main challenges that the banking sector needs to address in the wake of falling profit margins are:
Staying solvent and profitable. To do this, the sector needs revenue, but it also needs to be flexible and adapt to the changing circumstances. This means getting rid of unnecessary structures and building strength elsewhere, through increased integration, reorganisation and innovation to become more efficient and, ultimately, more profitable.
Satisfying the customer. Customers are more tech-savvy and demanding than ever before, and they expect quality, agility and security.
Continuing the digital journey. The pandemic has acted as an accelerator pedal for digitalisation, knocking down traditional barriers that before seemed immovable. But the real challenge is to keep moving forward, rethink operational models and apply the lessons learnt with regards to detecting, prioritising and optimising investments by assessing added value, cost and time-to-market.
Reviewing traditional management and production models. This involves removing and redefining structures to make them more digital but more human. It requires a focus on expanding employee skill sets and learning to interact and empathise with both teams and customers in a new way. Furthermore, this training and learning needs to become permanent and embedded.
According to the managing director at GDS Modellica, Antonio García Rouco, “In this new era of open banking and APIs that collaborate with Fintechs, creating an almost invisible bank, there is a need to redefine the ecosystem and move forward with improved operational and management systems and market-leading solutions, leaving to one side investments in areas where they lack a dominant or mature position. And this requires businesses to adapt drastically but quickly, with a focus on automated processes, digitalisation and improved decision-making based on intelligent data management”. Ultimately, the banking industry has to learn to anticipate new customer demands using new tools and integrated solutions. It is absolutely key to stay one step of the customer whilst guaranteeing security and transparency at all times.
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