5 Vital Improvements Your Financial Institution Can Make with Its Corporate Banking Relationships

Long-term relationships are especially important for financial institutions (FIs) that focus on corporate clients. Recently, innovations in finance software have given corporate banks more potent tools for cultivating and maintaining these relationships. 

These corporate banking innovations are largely in the field of artificial intelligence (AI) and machine learning (ML). The AI and ML capabilities of today’s corporate banking software allow them to effectively handle activities that used to require significant human input, including some related to risk assessment and client relationship management.

As it is, most financial institutions may be poised toward adopting these advanced systems. A white paper by the Economist Intelligence Unit, a UK-based think tank, showed that 77% of bank executives surveyed think that AI adoption will be what differentiates “winning and losing banks.” 

In the context of corporate finance, the adoption of new systems can make a difference when it comes to maintaining existing relationships. Below are a few vital improvements to banking relationships that could be facilitated through system upgrades.

1.) Real-Time Financing

Traditionally, financial transactions involving large amounts of cash would often involve considerable manual processing and underwriting. This was necessary to reduce the risk to financial institutions. However, this is less necessary these days thanks to the use of newer systems that leverage machine learning and artificial intelligence. 

These corporate banking solutions can dynamically assess risk and the financial positions of all involved parties in moments, which allows financial institutions to immediately release cash without undue risk. Being able to offer real-time financing or other expedited financing solutions to clients may help strengthen your institution’s client retention as well as its reputation.  

2.) Better Client Service

Corporate clients are almost spoiled for choice these days when it comes to financing options. Given this, clients now have higher expectations for service than was typical a generation ago. This means that financial institutions must now look for new ways to encourage client retention.

New corporate banking software may provide part of the answer. The improved automation and machine learning capabilities of these solutions can enable financial institutions to provide more effective client service. 

Simple queries and customization can be facilitated by AI through enterprise-class chatbots, significantly cutting down the time clients need to spend on customer service calls. New systems can also use previous client interactions to determine the types of finance products they may be interested in. They can be used to seamlessly personalize the client experience, ultimately improving retention and client lifetime value.

3) Highly Individualized Financing

Generic finance solutions no longer make much sense in today’s corporate finance environment, especially for existing clients. Being flexible enough to provide customized financing that closely matches a client’s requirements can help ensure a stronger relationship with the institution.

Thanks to better corporate banking solutions, this customization is now simpler to arrange. The transparency and advanced data management offered by such systems can enable institutions to quickly and dynamically assess potential risks in any contract. This not only ensures that clients get products that suit their needs, but it also helps protect your FI from unnecessary risk.

4.) Improved Forex Services

Virtually all businesses today require foreign exchange for facilitating overseas payments. Thus, having consistently good forex services can be a powerful incentive for value-conscious corporate clients.

AI and ML technologies in newer systems can also be leveraged to consistently provide the most advantageous forex solutions at any given time. This can be used to encourage clients with high volumes of foreign transactions to choose your institution. 

5.) Reduced Data silos

As financial institutions grow larger, there is a tendency for different customer data fields to become locked up in different projects or departments. This slows down the ability to compile information, which is often expressed as delays from a client’s perspective. FI’s with heavily siloed data will also often require customers to repeat the same data multiple times, leading to a negative experience.

A well-implemented systems upgrade should empower your FI to break down these data silos, reducing redundancy and improving service across the board. This should help improve client retention rates while simultaneously increasing data efficiency throughout the organization.

Better Corporate Banking Solutions for the Future

Corporate banks have to contend with a far more competitive environment than they had in previous decades. Today, corporate clients typically enjoy far more choices than they did previously. Not only is it much easier for them to “shop around” for a new bank, but most other FIs, traditional and novel alike,  can also now potentially create custom solutions that may draw these customers from their current preferred bank.

As such, corporate banks that have been late to address new realities face a dwindling client base. To reverse this downward trend, revisiting banking relationships and offering better, more relevant services is necessary. For many, this means considering improvements in current corporate banking solutions, including software, product offers, and business models.