Sunday, October 2, 2022
Published 2 Months Ago on Tuesday, Aug 09 2022 By Daryn Kara Ali
Day by day, the world is recognizing the global technological uprising, with economies worldwide preparing for the next wave of economic development. In this digital insurgency comes a shift in dynamic for financial sectors, as services initiate a new thriving phase, integrating two industries to enable a more advanced financial inclusion. Telcos are spearheading the global transition into digitalization. Telecom financial services are the new norm for any business, integrating two paramount ecosystems to convey a more seamlessly optimized convergence of banking and telecoms market.
Telco financial services are growing in numbers on a global scale. The deployment of such solutions is not simply covering mobile payments and their systems, but it extends to fortifying the relationship between banks and telcos on a different level.
Nowadays, financial services are not only confined to the limitations of exceeding competition boundaries between banks and telcos, but they branch out to set foot in the financial transactional line of businesses. The rising digital age and the technological revolution have left banks in a position of contemplation and fragility in terms of adapting to the critical alternations their business model has to endure to accommodate the hasty digital growth.
And telcos are now deemed banks leading competitors in regard to modifying their relationship with their customer base to meet their needs and, by doing so, exceeding the financial services deliverance than that of banks.
The telecommunications industry is becoming increasingly client-oriented, focusing on delivering the highest level of financial services through digital payments, digital wallet, and mobile money transfers. Yet, this incorporation of financial technology into telecommunications companies has not reached the level of success telcos aim for, mainly due to regulatory movements, control over capital flows, and others.
And this is where banks have the upper hand over telecom operators as they have a strong hold over payments, branch banking, and deposit insurance systems. Despite telcos presenting themselves as a future competitor to the banking sector, a unification between these sectors is necessary to ensure a consolidation in terms of capital and customer base.
At the moment, telecommunications companies have the monetary resources to reduce or even eliminate the use of intermediaries between producers and consumers for credit card companies, from the likes of MasterCard, Visa, and American Express. With the endless scope of interactive functionalities, smart devices, specifically mobile phones, are weaponized with the prospect of delivering the needed information faster than any other means. This means faster functionalities than banking solutions.
This will overshadow credit card’s current capabilities, and the only thing needed to do so is a wireless network and the right platform, which telecom operators can provide. However, with the proper integration of banking financial services and telecom financial software, the prospect of reaching a bigger consumer base will be much easier and more applicable. Such convergence between these two sectors will allow users to check their bank’s financial balances, pay bills, transfer money between accounts, and execute routine financial transactions more schematically.
Such telecom financial services merged with banking services will provide a new way of managing finances. In this case, the traditional checkbook will become a digital one, where any financial operation can happen from the comfort of holding a mobile device and with the connection of wireless technology, enabled by the interactivity to perform banking transactions via telcos connectivity services and managing mobile money.
Telecom operators’ incentive to enter the financial universe has never been more evident, as they offer the prospect of delivering innovative and secure financial solutions at a larger scale. By building robust relationships with their customers supported by advanced analytics and diversified collaborations with banks, telcos can bring forth a new level of flexibility and more compelling access to a market with promising capabilities.
Given mobile operators have branched out to a more vast customer reach. They can adhere to the promise of delivering technological and financial services and finalizing mobile payments integrated with networking characteristics – an assurance current traditional banking institutions have failed to meet in accommodation to global digitalization.
Smartphones can fulfill such promises as they efficiently deliver the needed means to access and conduct financial services. This promise is even more fortified through an established relationship between the telcos and their customer base.
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