17 Types of Software for Financial Services Providers [2024]

Software for Financial Services Providers

Because of the nature of their services, banks and other financial institutions (FIs) and financial services providers have very specific needs when it comes to data security, regulatory compliance, risk management, and service levels.

This means that technology investments such as specialized banking software are necessary to help them meet both internal goals and industry standards.

Below are some general categories of software intended for the use of this. These can be standalone solutions, modules that are a part of a larger software suite, or functions within a comprehensive banking platform.

Here are 17 Types of Software for Financial Services Providers

1.) Accounting

Accounting software is used to manage the day-to-day transactions of an organization. While they may share data or be part of a single software suite, accounting software should not be confused with revenue management or billing solutions, as these are more focused on a more narrow aspect of an FI’s dealings.

2.) AML and Financial Crime Compliance

This type of software allows FIs to seamlessly adhere to different standards and regulations, particularly those related to anti-money laundering (AML) compliance.

Modern iterations of these solutions may take advantage of advanced know-your-customer (KYC) and customer due diligence (CDD) tools, as well as use powerful artificial intelligence (AI) and machine learning (ML) modules to quickly detect and flag potential instances of financial crime, which could then be investigated by human specialists.

3.) Business Intelligence

Business intelligence software helps FIs reduce risks and tap into new markets. These solutions typically have highly advanced reporting features as well as data integration with other software suites and modules.

Modern software will typically have AI and ML-powered forecasting and data visualization to better aid an FI’s decision makers.

4.) Corporate Banking

Corporate banking software is highly specialized towards the types of services demanded by today’s corporate clients.

These solutions typically include features to facilitate core banking, supply chain finance, treasury management, liquidity management, lending process management, and other areas needed by FIs to serve corporate clients as well as other large organizations.

5.) Cloud Infrastructure

Banks and other FIs are now increasingly moving away from purely onsite computing solutions towards cloud and hybrid computing setups. FIs that opt for cloud-based or hybrid infrastructure need industry-appropriate software solutions to ensure they enjoy the advantages of these platforms.

Notably, the type of software used to facilitate cloud services for FIs has to be specifically designed to meet their unique security and service level requirements.

6.) Customer Acquisition and Experience

Sometimes called CEM (customer experience management) software, these solutions are intended to help FIs refine customer acquisition, usually through customer feedback and analytics data. This type of software can be standalone or part of a larger marketing or banking software suite.

7.) Customer Relationship Management (CRM)

While sometimes confused with CEM software, CRM software is more focused on customer retention, particularly through improvements in the customer journey. These solutions will usually allow FIs to track customer journeys regardless of what channels they use to communicate.

When leveraged correctly, this software can help improve customer retention as well as customer lifetime value.

8.) Enterprise Risk

These solutions are primarily designed to help FIs navigate various risks, including credit risks, market risks, liquidity risks, compliance risks, and other risks relevant to financial services. Enterprise resource planning (ERP) software for FIs is sometimes categorized as a type of risk and finance solution.

9.) Revenue Management and Billing

The solutions are critical for FIs with clients or partners that issue regular bills. These solutions have features to improve business agility, including adaptable pricing, billing options, and presets, to name a few. Some solutions may be intended for specific uses, such as for healthcare payers and credit card issuers.

10.) Human Capital Management (HCM)

These solutions are designed to help FIs maximize their employees’ economic value. They are related to but distinct from human resources software, which is primarily concerned with facilitating administrative tasks that allow employees to function effectively.

Thus, HCM software is meant to facilitate strategic long-term employee management for areas that increase their value to the organization.

11.) Human Resources (HR)

Where HCM software is meant for strategic employee management concerns, HR software is tactical in scope. These solutions are primarily intended to aid in the day-to-day administrative tasks that enable organizations and individual employees to be at their most effective.

12.) Help Desk

Help desk software is designed to help FIs organize and respond to service requests. Service requests can be from clients or internal teams. Help desk software designed for FIs will tend to have FI-related analytics as well as features that help with regulatory compliance related to the use of sensitive financial information.

13.) Insurance

These specialized solutions help insurers to facilitate a wide array of insurance services. These have to be extremely flexible to accommodate the customizations needed to serve different insurance customers.

These will also usually include integration with CRM, marketing, trading, and billing solutions to fully cover the requirements of various policies.

14.) Payments

Banks and other FIs that want to be competitive in today’s financial markets need to be able to process payments in real time and at scale. Cutting-edge digital payments solutions allow FIs to not only facilitate different payment types but also automatically reduce cross-border transaction risks and costs.

15.) Project Management

These software types make it easier for FIs to manage their workflows. When implemented well, they can give managers a highly nuanced view of all of the FI’s activities across all departments and levels.

With advanced AI and machine learning, these solutions can even give dynamic suggestions for improving and streamlining processes, reducing the cost of doing business.

16.) Remote Work

Remote work software allows onsite and remote teams to collaborate effectively and securely on a range of different projects. Industry-specific solutions are especially important for emerging digital-only FIs, as they allow collaboration to proceed without compromising sensitive data.

17.) Retail Banking

Retail banking software is designed to facilitate banking services for individual clients. This type of software typically focuses on delivering an elevated mobile banking experience as well as customer-centric account customization and fund management. These solutions are often localized for specific finance markets.

How Should FIs Choose Software?

These are just some of the more common categories of software employed by banks and other financial institutions. Apart from these, FIs may also employ software that is not specifically intended for the finance industry.

Generally speaking, banks that want to invest in new software should take care to look into the data integration capabilities of their prospective solutions, especially concerning their existing systems.

The ability to integrate data from various software subsystems can greatly increase data visibility and reduce the need for messy migrations and manual data consolidation. It would also allow banks to implement different labor-saving automation scripts.

In any case, different FIs have different needs. Purchasing these tech products without considering their benefits or tradeoffs can often result in process bottlenecks, which are exactly the things you want to solve with software.

By studying the merits of each available option, financial institutions can ensure that they will truly benefit from their tech investments.