How digital transformation and sovereignty are shaping the future of the financial sector
The financial sector is under pressure. Banks operate in a rapidly changing playing field. There is intensified competition from fintech companies and tech giants, customers have increasingly high expectations of digital services, and geopolitical tensions are putting pressure on margins. At the same time, regulatory and digital security requirements are increasing, and there are growing questions in Europe about digital sovereignty. For Francois Toussaint, key account manager at Sopra Steria for ING, it is clear: financial institutions that want to remain relevant must constantly adapt.
Digital transformation as a necessary step
According to Toussaint, the most important challenge for banks is digital transformation. “Banks are increasingly becoming IT companies. Business and technology are integrating, and customers expect fast, personalised and digital services across multiple channels. Banks that lag behind in this respect will lose their competitive edge.”
A simple example of this is lending. ”If a bank today cannot provide clarity on a loan application within 24 hours, there is a good chance that the customer will go elsewhere,’ says Toussaint. ‘This requires optimised digital processes, supported by data and smart technology.”
He also mentions the consequences of geopolitical developments. Trade conflicts, wars and interest rate cuts are affecting banks' revenue models. “Cost control is a priority. Automation and efficiency, for example through the use of AI, are essential to remain profitable.”
Growing importance of sovereignty and compliance
Another challenge identified by Toussaint is the increased focus on digital sovereignty. "In Europe, the aforementioned geopolitical tensions are fuelling a debate about whether we as a continent are too dependent on non-European data services and technologies. Will we still be able to rely on the services of these companies in the future, and will our data still be secure? I notice that this discussion is becoming increasingly common, and it is important that we think about this and, if necessary, fall back on European alternatives to safeguard our strategic autonomy. ING, for example, already has data centres in the Netherlands.”
In addition, the sector is struggling with the explosive growth of legislation and regulations. Directives such as PSD3, GDPR, DORA, MiCA and the AI Act not only have substantive implications but also lead to rising compliance costs. “Smaller banks in particular often lack the necessary expertise in-house, and it is also a burden for larger banks. Sopra Steria is responding to this by pooling its regulatory knowledge and sharing it internally, so that employees are better able to advise banks.”
From developer to strategic sparring partner
Toussaint initially wanted to study IT, but at the last minute he opted for economics, fearing that coding would bore him. Nevertheless, after graduating, he ended up at the software company Callataÿ & Wouters, which developed solutions for the financial sector. He worked there as a developer and IT consultant until the company was taken over and continued under the name Sopra Banking Software.
He held various positions within the company: analyst, team and project leader, and business development manager. The switch to sales came unexpectedly but turned out to be a bull's eye. “I noticed that I particularly enjoyed customer contact. Understanding their challenges and working together to find solutions. Trust is essential in this regard; without trust, a customer will not share their real pain points.”
As a key account manager, he is now responsible for the relationship between Sopra Steria and ING. “I am in daily contact with stakeholders at various levels. Only by listening carefully and analysing critically can we tailor our services to the strategic goals of the customer.”
End-to-end service provision as a distinguishing feature
Sopra Steria has all the expertise in-house to tackle the major challenges currently facing banks and insurance companies. Whether it concerns digital transformation, data security, regulatory compliance, or risk and operational management, the IT company can support financial institutions with end-to-end services. Toussaint: “This starts from a strategic perspective, where we develop a vision based on market trends and an analysis of the customer's pain points, which is then translated into a step-by-step plan. This plan can then be implemented with the help of teams in areas such as data & AI, compliance, cloud, cybersecurity and customer experience.”
According to Toussaint, this is Sopra Steria's great strength. At the same time, this versatility can be a disadvantage, as it has to compete with specialised companies that are very good at one aspect. “A major advantage is that we know the Belgian and Dutch markets like the back of our hand; we know the regulations and the financial institutions. We are not just developers, we also have functional and business analysts, and when you add all that together, we can make a difference. But it won't be easy as the market is very competitive.”
AI offers opportunities, provided it is used responsibly
The financial sector is currently still cautious about AI, but this is partly due to the complex playing field in which it operates. Nevertheless, according to Toussaint, AI offers advantages such as cost savings, time savings and better decision-making. He believes that AI will therefore play a greater role in the long term, for example in customer processes, fraud detection and credit decisions. At the same time, he emphasises the importance of transparency. “AI has enormous potential, but we must
be wary of black box solutions. So, I'm keeping a critical mind, and I think we need to be cautious about using AI. In any case, I'm glad that we have good regulations for AI in Europe with the AI Act. There are many interesting initiatives, but we are still waiting for AI applications that we can use on larger scales. While numerous proof of concepts are underway, only a limited number are being industrialized at a company-wide level.”