No-Code & the Financial Services Opportunity

Despite financial institutions growing bigger in size, they had been staring at the prospect of disaggregation. New players, including fintech, neo banks, and consumer platforms are chipping away at these traditional institutions. Financial institutions have been at the forefront of technology for years -as expensive technology was only affordable to them. However, as technology, today has become more democratized, through open-source and fractioned server/ data storage through cloud services, financial institutions have found their legacy technology turn from a source of competitive advantage to now a stage of catching up. Maintaining/upgrading legacy technology still consumes approximately 75-80% of their technology budgets. This constrains the quantum of spend on the adoption of new cheaper technology and impairs their ability to compete effectively with new entrants.

No-code platforms allow financial institutions with an opportunity to break out of this vicious cycle and move to a path of optimized innovation.

Understanding No-Code Platforms

Technology has traditionally been the domain of developers and analysts that took requirements from end-users to deliver an automated solution. These solutions needed iterative improvement, due to lacking in delivery of the full vision of the end-user, and this created a dependence on the IT departments for subsequent changes. This leads to a high cost of delivery and maintenance, and power being taken away from the end-user.

No-code platforms return the power back to the end-user, by empowering them to directly configure systems their way - without writing any code. Dependency on IT departments is limited to architecting their thought process into more efficient processes and data flows.

No-code platforms translate back-end code into a front-end guided UI experience thereby reducing the need to code or even understand the underlying programming language in use. Simply put, any user can make and replicate processes, data flows, computations, and visualizations without understanding a single line of code.

Benefits for Financial Institutions

Speed of roll-out: Developing a technology solution required months typically due to slowdowns generated from the translation of requirements, iterative development/testing, and even re-architecting from scratch. No-code platforms allow the end-users to build their requirements into actual output within days. Lesser frequency of iteration between end-users and developers means faster time to roll out. The elimination of coding also reduces system bugs caused by human error.
Cost of ongoing maintenance: Deploying a bespoke solution and even vendor solutions requires verifying code integrity, ensuring that coding standards are adhered to, and worrying about maintenance. Building on a no-code platform reduces such worries since there is no code written at an application level.
Lower total cost of ownership (TCO): TCO has been a thorn for financial institutions and despite their best efforts, often end up bearing high TCO post-implementation. No-code platforms reduce vendor dependencies and allow for frequent enhancements cheaper and faster.
Quicker outputs: Approximately 70% of digital transformation projects are known to fail or stall due to long delivery cycles. This leads to making interim changes in vision and requirements leading to loss of project momentum. The quicker output of smaller applications enables greater engagement and success in actual utilization.
Smaller is better: In a micro-services world, smaller applications trump large legacy applications. In a traditional roll-out, base costs like project management, code validation, and infrastructure provisioning irrespective of size made it impractical to build smaller applications. No-code platforms reduce TCO on roll-out by enabling nimbler micro-services to be rolled out much quicker.

Are All No-Code Platforms Equal?

Firstly, are all no-code platforms really no-code? Several platforms have claimed to be no-code or low-code. These have reduced coding in certain areas like reporting, visualizations or rendering HTML. These are not no-code platforms but merely a step in the right direction. To assess if a platform is truly no-code, a few questions have to be answered:

  • Can I undertake full-fledged data management without having any knowledge of SQL?

  • Can I write complex computations as I do on spreadsheets?

  • Can I create workflows as if I am making flow charts?

  • Can I enable API-based connections with third-party providers without writing code for each connection each time?

  • Am I getting a visualization layer directly from the platform or only via third-party visualization tools?

  • Can I create and distribute application-like packages?

  • Does it allow for multi-tenanting, multi-environments, and support for sharing and unifying data across environments?

If the answer to any of these is NO, the platform is merely a portion of no-code perhaps more low-code. Recognizing that all platforms claiming to be no-code are not equal is very important in ensuring that the benefits of speed and low TCO are realized.

How Should Financial Institutions Start Their Journey?

It is preferable to use no-code platforms to overlay and not displace existing legacy infrastructure. Start with building non-core customer/employee-focused applications, which won’t disrupt the legacy infrastructure but builds on it. Once such applications have built enough functionality to replace the existing ones, it is then easy to dispense legacy applications while retaining legacy data. Replacing legacy applications in a big-bang approach creates large projects with larger overheads.

Another area for using no-code platforms is in applied analytics. Analytics has matured from post-event fact dissection to now a data-driven decision-support. No-code platforms are best suited to decision support analytics.
The possibilities for financial institutions are infinite. No-code platforms will inevitably replace legacy technology. The faster financial institutions adopt it, the more they can reduce the technology gap with fintechs and neo-banks.