Digitalization in the capital markets: Key components of a future-state operating model


The future of capital markets lies in digitalization. Financial service firms need to digitize and modernize to bring their technological infrastructure into the 21st century. It’s crazy to see how many firms still rely on Excel spreadsheets and handwritten notes when they can be taking advantage of the technological advances that lead to increases in efficiency and productivity. BNY Mellon recently published a report exploring how firms should be future proofing by using more advanced technology. Here are the two biggest takeaways:


The first big takeaway is the importance of artificial intelligence. Artificial intelligence is the next wave in all things technological and it can be an important tool for capital markets. Per the BNY Mellon report, “portfolio managers and quantitative specialists are increasingly using tools such as cognitive computing, machine learning and social media to obtain informational advantages, while robotic process automation is being applied in the asset servicing space to enhance client experience.” Dealmakers can work smarter and more efficiently by automating certain processes. For example, they can set up alerts, receive suggestions on deals or communication updates, and pull reports populated with data.


In this way, firms can leverage artificial intelligence to make workflow more effective and efficient every single day. It is so important for firms to recognize the value of AI and see how right now they are barely scratching the surface of what they can do with automation. If firms can make it possible for dealmakers to focus on client interaction rather than collecting and organizing data, the client is better served. Thus, being open and ready for what artificial intelligence and automations will have to offer is a key component for the future of your firm.


The second big takeaway are application programming interfaces (APIs). APIs are data flows that create connections to communicate data between systems. Currently, APIs are being developed to ensure data is being organized and provided in ways specific to the client receiving it. Per the BNY Mellon report, “coupled with analytics tools, such data empowers buy-side leaders to boost investment performance, increase asset flows and improve client experience with the aim of generating value for end-clients and across the organization.”


Furthermore, APIs can be configured in a few different ways, either bidirectionally or in one direction, so data can be customized in how it flows. Firms will want to integrate data flows for HR platforms, portfolio monitoring platforms, and financial institutions to ensure easy and efficient data sharing between systems. It’s also important to note, that in order to take advantage of APIs and efficient data flow your firm needs to employ an open architecture platform so you can create these connections. APIs are an important part of an efficient technological infrastructure and taking advantage of them is a big part of future proofing your firm.


Digitalization is the future of the capital markets industry. From embracing artificial intelligence to employing APIs, digitizing is the smart, effective and most efficient way to future proof your firm.  To learn more, contact or schedule a demo today.


Kari Lukovics

Related Posts:

Streamline deal marketing with AI-generated email content Optimize your corporate development pipeline How to enhance IR fundraising efforts with strategic data
Next Article