Michael Heffner, Head of Global Industry and Value In 2025, the prevalence of open banking models is rising while cybersecurity and compliance standards are tightening. These factors will define the year’s to-do lists for chief information officers (CIOs) and other financial services leaders.
In a
prior article I wrote for Banking CIO Outlook, I outlined three artificial intelligence (AI) trends that are reshaping banking for customers and employees. Now, I want to discuss three broader industry trends that will determine how AI and other new technologies should be used.
Trend #1: A Shifting Regulatory Landscape
The regulatory landscape for banks is becoming both more and less strict. We’re seeing enforcement of recently enacted regulations on
AI governance and
cybersecurity, and new regulations like the
Digital Operational Resilience Act (DORA). But at the same time, recent political developments in the US mean banks can expect other regulations to ease over time.
How to prepare: Financial services organizations need to ensure their technology architectures can
handle this kind of shifting compliance context. Success requires the ability to routinely track regulatory changes, analyze their implications for enterprise operations, and leverage automation to adjust workflows and processes accordingly.
Trend #2: Open Banking Expansion
Open banking services are poised for significant growth in the coming year. This trend is propelled by advancements in data-sharing technology and rising consumer demand for greater choice and control.This shift will intensify competition for traditional banks, but it does not spell their end.
How to prepare: To adapt to the new era of decentralized banking, firms should double down on personalized services. They should also find secure ways to leverage open banking APIs (application programming interfaces) to integrate more third-party apps and services.
Trend #3: Increased Focus on Cybersecurity
New regulations and technology will both make cybersecurity a top priority for banking CIOs and risk management officers in 2025. As trends like open banking cause financial institutions to become more interconnected, vulnerabilities in their IT ecosystems multiply. Fines and penalties for regulatory non-compliance may also increase.
How to prepare: Banks will need technology architectures that reliably support advanced security protections. Enhanced encryption, real-time threat monitoring, and stringent access controls will become even more essential to cybersecurity strategies.
Banking institutions of all sizes need to prepare for these three industry shifts. And that means having a plan for how your organization will use AI and other technologies to address them.
For example,
FirstBank used an intelligent case management platform to achieve 100% AML (anti- money laundering) compliance. They built an application that gives them a comprehensive snapshot of all potential AML cases in real time—including detailed case information, documentation, comments, and collaboration history. The FirstBank application integrates with all their core systems and automatically pulls AML alerts every night. It allows employees to report suspicious activities and supports continuous monitoring. With this technology, FirstBank saves 1,000 hours every year.
FirstBank’s story is just one of many use cases for banking technology that can prepare you for success throughout 2025. To determine what your organization needs to be ready for the industry trends on the horizon, ask yourself these questions:
● Can my technology architecture handle rapid process change?
● Will my technology be able to easily integrate with open banking APIs?
● Are my organization’s security capabilities up to date?
Low-code platforms with AI and process orchestration capabilities are a popular way to address all these things in one investment. You can find a list of the current leading vendors as well as a discussion of their strengths and limitations in the
2024 Gartner® Magic Quadrant™ for Enterprise Low-Code Application Platforms (LCAP).
By making the right technology decisions now, CIOs and banking leaders are setting their organizations up for resilience in the face of changing industry trends in 2025.
