PwC is focusing on partnerships, alternative commercial models, and execution to innovate in the financial services sector

PAC recently had the opportunity to attend a PwC EMEA financial services (FS) analyst day focused on how they are helping to transform clients from strategy through to execution. The event covered a range of interesting topics that demonstrated the deep domain experience PwC has in the FS sector, delivered through partnerships with Microsoft, alternative commercial models with clients, and their move beyond consulting into execution and managed services.

Of the many areas discussed during the day, the FS partnership between PwC and Microsoft resonated significantly with PAC given the conversations we are having with banks. At the core of the partnership is an FS offering PwC calls Infinite Financial Solutions. From a technological perspective, it combines the Microsoft Cloud for Financial Services product and a range of PwC-selected FinTech solutions to provide modern digital banking capabilities in the cloud. The PwC FS team have built strong relationships with FinTech’s spanning customer and business services, data and insight, sustainability, open banking, credit, know your customer (KYC), and property.

PAC was particularly encouraged by how the PwC FS team demonstrated the implementation flexibility of their offering to meet the needs of a bank irrespective of the countries they operate in. A common challenge for long-established banks is the inflexibility of existing core banking systems hindering the ability to adapt to new market demands quickly and at scale. The PwC Infinite solution provides an adaptable cloud-based banking solution that allows for pre-certified FinTech solutions to be selected or changed based on the regional needs of a bank complementing the capabilities of the Microsoft Cloud for Financial Services. All are based on the depth of knowledge and experience that PwC has from years of serving the FS sector.

When PAC speaks with established banks, not digital challengers, it is still evident that legacy core banking systems are a heavy burden to carry. All too often, the pressure on IT functions within banks is to deploy a solution to meet the demand for a new banking product/service and then move on to the next new goal. Addressing the value, relevance, and inefficiencies of long-established core banking systems are often not of high priority and gets deferred later. However, hyperscale public cloud-based solutions, like Microsoft Cloud for Financial Services, allow for serverless and containerised IT architecture approaches that can devolve banking technology monoliths into component elements. Which then can be re-platformed or architected into a Banking-as-a-Service platform or maintained in low latency cloud compute leveraging containerisation to negate the operational challenges and costs of legacy monolith systems.

A solution like PwC’s may seem obvious, but banks’ core banking challenges remain a constant. It is clear to PAC that banks need the deep and granular expertise that PwC FS has available through its consulting, execution, and management capabilities to devolve years of incremental complexity in core banking. This, in turn, allows, through a modern technology architecture at the heart of the PwC Infinite solution, greater flexibility to add and subtract banking services without extensive and protracted re-engineering each time additional FinTech capabilities are required.

PAC was encouraged to see the PwC FS team demonstrate modern banking solutions, commercial flexibility, and managed services that leverage their extensive and in-depth FS knowledge. However, the marketplace for these services and engagements is becoming increasingly competitive, so PAC is interested to see how PwC’s competitors adjust over time.