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Financial Services Industry CRM Software Solutions

Banking SIC 60, 61, insurance SIC 63, 64 and investment services SIC 62, 66, 67


Financial Services Industry


With the exception of the insurance and retail banking segments, the financial services industry is regarded as a technology leading vertical market and often holds the largest share of CRM utilization compared to many other industries. However, retail banking has remained financially conservative and has tended to emphasize activities such as branch automation, fraud detection, straight-through-processing, simple and other internally-focused efficiency plays. Interestingly enough, CRM software solutions in the retail banking sector made their inroads with traditional operationally focused CRM applications and have been partnering or localizing their solutions for this vertical market since. For example, in 2001 Onyx partnered with Metavante to deliver straight-through-processing solutions while in 2004 Siebel acquired Eontec in order to deliver branch teller and Internet banking services. Oracle and SAP have more recently developed similar strategies through acquisitions and partnerships.


Recent global economic conditions have brought dramatic impact to this industry. Financial services companies have been hit hard by the 2008 sub-prime mortgage collapse which started in the US and spread elsewhere. Large financial write-downs, a much more volatile market and increased economic uncertainty have resulted in financial services companies being pushed to more conservative business principals and placing a greater focus on existing customer relationships. At the same time financial services consumers have become much more sophisticated and demanding of higher service standards.


The merge of industry disruption with greater customer demands necessitates that successful financial services companies devise a strategy which achieves increased efficiencies and greater customer focus and results in lower operating costs, better information, increased customer share and reduced customer churn. The majority of competitive players have turned to Customer Relationship Management systems to achieve these operational and information system requirements. For example, using CRM systems to consolidate multiple line of business information to achieve a holistic view of the customer's information, portfolio and household delivers insightful up-sell and cross-sell opportunities. Further, when sales, marketing and customer support business processes are automated using CRM software, cycle times are dramatically lowered and user productivity increases.


Product differentiation is an increasing challenge for financial services companies. Even when innovative financial product solutions are developed, they are soon copied and quickly join the remaining portfolio of commodities products. However, top financial services players have figured out that a consistently positive customer experience is not easily copied and provides significant competitive advantage. Implementing customer processes with supporting CRM technology that combine to deliver a superior, repeatable and valued added customer experience with every customer interaction contributes to sustained customer retention, referrals and loyalty.


The financial services technology sector in Asia-Pacific is driven by expansion into the emerging Chinese and Indian markets as growth in Japan falls idle. CRM software vendors are delivering more localized offerings which better target the rapidly expanding life and pensions sectors.


Leading financial services CRM software solution vendors include the following:

  • Siebel Systems continues to hold the market share leadership position.
  • Avaya, Aspect Software, SAP and Reynolds and Reynolds compose the second tier.
  • Oracle, Amdocs, Genesys Telecommunications, Onyx and Sage rand in the third tier.
  • In the on-demand industry, and Aplicor both have measurable market share and specialized industry editions for financial services.

Other CRM relevant factors:


The Gramm-Leach-Bliley Act (also known as GLBA or The Gramm-Leach-Bliley Financial Services Modernization Act) was a 1999 federal mandate which repealed the Glass-Steagall Act in order to permit banks, insurance companies and securities organisations to offer investment, commercial banking and insurance services. From a hosted CRM software perspective, financial services companies must gain assurance that their hosted CRM software facilitates or meets compliance and information security standards for the privacy rule, the safeguards rule and pretexting as well as the more detailed requirements outlined in Subtitle A and Subtitle B of GLBA.


CISP (Cardholder Information Security Program) and PCI (Payment Card Industry Data Security Standard) are specifications created and enforced by credit card companies for the purpose of ensuring and enhancing the privacy and security of financial information. CRM systems which store credit card data or process sales order transactions should meet the PCI security standard.


The financial services industry goes by several names, including, the Banking and Finance Industry, Insurance and Real Estate, Financial Services and Insurance Industry, Wealth Management Industry, Investment Services Industry, Financial Services and Banking Industry, Investment Industry, Finance Industry, Investment Management Industry, Financial Industry and Insurance and Financial Services Industry.

  Financial Services CRM

Financial services companies are institutions which offer financial products such as investments, insurance or loans to consumers and individuals.


The financial services vertical market includes a broad range of services that all tend to deal with the management of money and funds. Common financial services organisations include banks, insurance companies, finance companies, investment funds, stock brokerages and credit card companies.


The regulatory requirements are diverse for most countries, however, the United States tends to lead financial services regulation, consumer protection, and the compliance and information security requirements that bring operational and technical implications for Sales Force Automation, Customer Relationship Management and related information systems.


The Gramm-Leach-Bliley Act (GLBA) is used in the US and has been adopted with various minor changes in other parts of the world and provides specific requirements that ensure consumer information remains private and secure. These requirements transcend to on-demand CRM software solutions where consumer data is hosted in a third party data center.


Financial Services Industry

Financial Services CRM Systems

Financial services vertical market CRM products are beginning to be delivered by the on-demand software companies and have long been delivered by the on-premise software licensing companies. The benefits of using an industry specific solution include better business process alignment, higher functional fit, less customization, fewer extraneous screens and functions (which don't apply to the financial services industry), faster user training, increased user adoption, reduced implementation failure risk and a reduced software implementation time frame and cost.

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