SRM Provides Guidance on Trends Shaping 2018

MEMPHIS, Tenn.--()--SRM (Strategic Resource Management), an independent advisory firm for financial institutions, has released its semiannual industry trends and forecasts, offering perspective for financial institutions’ near-term decision making. SRM tracks existing and emerging trends in the industry, publishing a view to what the firm expects every six months.

Brad Downs, CEO of SRM, commented, “The past six months have been marked by surprising acquisitions, intriguing alliances and continued curiosity around new market entrants. We are seeing vendor contracts put up for review much more frequently than in the past, and financial institutions have hastened in their fintech evaluations. These factors can make for a complicated decision cycle; a process that we want financial institutions to enter into well informed and positioned for success.”


  • P2P is nearing critical mass. Some institutions have yet to offer the service, but independent P2P providers have bridged that gap. We should continue to see broader, more efficient payment options presented for all use cases, from splitting lunches to paying school fundraisers or making high dollar sales.
  • Debit card portfolios continue to be under optimized. Banks and credit unions are sitting on top of a material amount of opportunity to unlock the value in these portfolios while improving customer loyalty through top of wallet promotional efforts. Look for more institutions to engage in penetration, activation and use (PAU) programs that are designed specifically for improving debit card portfolio value.

Digital Strategy

  • The replacement of aging online and mobile banking products has reached escape velocity. The largest technology replacement cycle in the U.S. banking system is underway as financial institutions identify ways to reduce the cost and complexities created by disparate digital services.
  • Building a truly comprehensive digital channel feeds into pressure to have a competitive data analytics strategy. An increasing number of regional, mid-sized and community institutions are interested in how data analytics can help them add value to customer relationships through individually tailored offers and advice. Most still struggle to understand how to apply the data they have, but more use cases will emerge soon.

Core Processing

  • Some larger banks and credit unions are envisioning digital as the “new core,” whereby the digital platform becomes the system that manages all customer interactions. The core processing system continues to serve as the keeper of account balances and related bookkeeping tasks in this scenario, but the digital platform mitigates the impact of innovation on the core.
  • Newer players entering the core space are utilizing micro-services and component-based design, modernizing an area within financial institutions that has typically suffered from the limitations associated with aged, legacy systems. The use of the cloud by some of these new players is bringing new, attractive economics related to the licensing and maintenance of their solutions.


  • An increasing number of banks and credit unions are outsourcing digital, IT, compliance and core competencies. Previously a preferred deployment option for smaller institutions, now regional and multi-billion dollar institutions are embracing outsourcing. The trend will continue as the demands for continuous innovation grow.
  • Artificial intelligence (AI) and machine learning will become mainstream, opening up access to these technologies for community banks and credit unions. The applications for both stretch across all areas of an institution’s operations, delivering increased efficiencies and more personalized services.
  • Biometrics and voice recognition can make a difference for fraud to issuers. Voice recognition is boasting nearly 100% accuracy. Also look for voice-interfaces to become more commonplace in mobile banking as banks and credit unions look for ways to decrease friction for the end users while increasing security for the institution offering the service.


  • $2.4 trillion in deposits has moved into the largest U.S. banks, cutting off the cash flow from the rest of the market. M&A activity remains concentrated in regional, mid-tier and community institutions as they attempt to gain scale to stem the loss of consumers to national brands. Though consolidation in banking is likely to remain at or near the average of 4% per annum, the locus of current activity along with ongoing investments in technology could change the competitive dynamics in the marketplace.

Downs continued, “It’s not a surprise that financial institutions are concentrating their technology spend on data, AI, biometrics, and seamless digital experiences. The decisions banks and credit unions make today with regard to their technology partners are more critical than ever. There will be winners and losers. We are seeing a number of our clients position themselves to be in the former group.”

About SRM
SRM (Strategic Resource Management) has been trusted by more than 700 financial institutions to serve as a trusted advisor in areas such as payments, digital banking, core processing and operational efficiencies. The company has unlocked billions of dollars in value and improved the competitive advantage of its clients with its reputation for its industry-leading subject matter expertise, proprietary benchmark database and proven negotiating skills. Visit for more information and follow the company @SRMCorp.


William Mills Agency
Megan Fort, 678-781-7223
Mobile: 678-758-2267

Release Summary

SRM has released its semiannual industry trends and forecasts, offering perspective for financial institutions’ near-term decision making.

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William Mills Agency
Megan Fort, 678-781-7223
Mobile: 678-758-2267