Intro
What Does the Future Look Like for Finance?
Extraordinarily rare is the person who can truly predict what the future holds in store, but sometimes a look at the present is all it takes to recognize arising opportunities. The financial industry is at a critical juncture and must come to grips with radical change. Business models are changing practically by the week, and all actors without exception currently find themselves at a crossroads. They are on the lookout for ideas on how to continue generating growth.
Many of the new ways of thinking are rooted in new technologies, infrastructures and data. The challenge is to utilize their full potential to tap new customer segments. We at SIX are working closely with our clients to futuristically transform the financial markets of today.
Future of Finance Study
Future of Finance 2024/25
The third annual study in the Future of Finance series by SIX reveals considered optimism, with widespread recognition that by embracing a variety of growth drivers, financial institutions are more likely to enhance competitiveness.
For Future of Finance 2024/25, Censuswide on behalf of SIX surveyed senior executives across 293 international financial institutions spanning asset management, wealth management, asset servicing, and investment banking in Germany, Hong Kong, Singapore, Spain, Switzerland, the UK, and the US.
The survey included questions across five key topics: growth, technology, data, capital markets, and the role of financial market infrastructure providers.
1. Moderate Growth
The majority (53%) of senior executives are expecting material improvements in the economic environment over the next year.
When senior executives are asked to assess their own organization’s position for growth over the next three years there is a 24% decrease from last year in those that see their own position as strong, dropping to 40%. This correlates with a similar rise in those that view themselves as moderately positioned, recognizing that further efforts will be required to fully realize opportunities.
Repeating a trend seen in 2023, Singaporean (53%) and Swiss (53%) financial institutions feel the most positively about their own position for growth.
The top three areas identified to drive this progression are expansion into alternative asset classes, adoption of solutions based on distributed ledger technology, and embedded finance.
Geopolitical uncertainties rank as the biggest expected external challenge.
How Would You Assess Your Organization’s Position for Growth over the Next Three Years
2. Transformative Technology
Senior executives identify artificial intelligence (AI), cloud, and data analytics as the key technologies over the next few years.
Although the implementation of AI ranks as the top technology priority for consecutive years, the ways in which senior executives anticipate it delivering the most client value have changed: Where last year we saw a clear preference for deploying AI in the value domain, this year, it has firmly shifted to a efficiency- and cost-led mindset (e.g. automated compliance, regulatory reporting).
Significantly, 99% of financial institutions anticipate using distributed ledger technology to trade at least one type of digital asset in the next three years.
Where Do You Anticipate Delivering the Most Client Value through AI Adoption in Your Organization over the Next Three Years?
Pick up to three answers
3. ESG Data as an Investment Focus
Consistent with the previous two studies, optimizing data capabilities is a core focus for senior executives. When it comes to the type of data that senior executives expect to increase their expenditure towards, ESG data has shot up in the rankings compared to last year, moving from fifth to first overall.
Nearly a fifth (19%) of senior executives cite greater availability/higher quality of ESG data as the key driver for growth in the ESG investing space, joint first with increased regulatory consensus (19%). It is the data capabilities and regulatory environment that are primarily driving growth at this stage of the development cycle for ESG investing, not the financial performance in the first place.
Where Do You See the Biggest Increase of Spendings for Data and Analytics (Top Three Mentions)
Pick up to three answers
4. Different Paths for Capital Markets
Senior executives have varied takes on how their local capital markets can help local companies increase global competitiveness, with a geographic divide evident in the results: In Europe (i.e. UK, Spain, Switzerland), senior executives favor an emphasis on the distinct advantages of their local listing venues. Those in the US prefer creating incentives for long-term investments. Those in Asia are looking for increased regulatory harmonization (Hong Kong) or promotion of a broad product universe (Singapore).
The views on what are the most significant drivers for companies choosing to list on European exchanges differ significantly across geographies: For UK-based senior executives, the reputation of European exchanges is the top driver (39%). Spanish and Swiss respondents point to the liquidity available on secondary markets and the trading infrastructure, scoring 42% and 40%, respectively.
How Can the Capital Markets in Your Jurisdiction Best Improve Competitiveness Compared to Other Regions of the World? (Top Mention)
Pick up to three answers
5. Future-Proofing Financial Market Infrastructures
The role of financial market infrastructure providers (FMIs) in supplying financial institutions with choice, support, and dynamic solutions to their challenges is ratified by the majority of respondents.
Senior executives reveal where the digital can complement the traditional, and how FMIs can play an active role in crystallizing positive expectations into success: A vast 89% of senior executives see distributed ledger technology (DLT) as being meaningful to their organization over the next three years. Nearly a quarter (24%) believe that it will be most meaningful when applied to post-trade, settlement, or clearing processes. 17% recognize the benefits of DLT in providing better data transparency and its usage in payments and cash services.
By providing a diversified set services, FMIs can empower financial institutions to anticipate and capitalize on emerging opportunities.
Where Do You Think Adoption of Distributed Ledger Technology Will Be the Most Meaningful to Your Organization in the Next Three Years
Learn more about how the story of capital market transformation and technological innovation unfolds in the Future of Finance 2024/25 study from SIX.
Research & Reports
Our Latest Publications at a Glance
What will the financial world look like in 5, 10 or 15 years? Which technologies will become dominant? What role will data and artificial intelligence play? We’re always thinking about the future, and we share our knowledge in various publications like white papers or reports in all the areas related to financial services. Our white papers include analyses of developments in the finance industry, new methods or specific problems that our clients are facing. We report the facts and then assess them on the basis of conversations with experts from the world of academia and the financial industry. Our aim is to initiate discussions and provide insights.
Future of Wealth Management
How is the Swiss asset management industry positioning itself and how should it adapt to the increasingly data- and technology-driven world in order to ensure its future competitiveness? Explore more about one of the most important business areas in the Swiss financial industry.
Market Participants’ Expectations of Market Data Providers
SIX, in partnership with Coalition Greenwich, surveyed 79 global buy-side and sell-side firms: find out what drives these firms in their choice of market data vendor, what types and frequency of data these firms buy and consume, and how they think about anticipated future use cases, sources and delivery.
The Impact of Technology on New Business Models in Banking
Digitalization has fundamentally changed the way financial services work today. Read about the most important trends in open banking, embedded finance and banking-as-a-service.
The Future of the Swiss Invoice Industry
Together with the University of Applied Science of Lucerne, SIX provides an overview of the Swiss invoicing industry. Find out more about their importance to the Swiss payment traffic and the economy, both in terms of transaction volume and their role in the Swiss payments culture.
The Perspective of Buyers of Voluntary Carbon Credits (VCCs)
Gain insights into the current state of the carbon credit market with a particular focus on the perspective of buyers of Voluntary Carbon Credits (VCCs). What are the key factors influencing the decision-making process for the purchase of VCCs, what are the challenges faced by market participants?
Do You Need More Information?
If you would like to find out more about our white papers, studies and reports, just get in touch.
Discover More
Further Glimpses into the Future
Now that the word “blockchain” appears to have crept into everyday parlance, neologisms like “DeFi” and “DApps” are going around these days. Find out in this blog post what they mean and how they’re changing the world of finance.
The importance of data goes beyond just being a source of income: Data links different businesses and even industries together. Read how data creates transparency, makes processes more efficient, and enables growth.
At least since Facebook changed its name, the term has been on everyone’s lips: the metaverse. What’s it all about? What do NFTs have to do with it? And what does it all mean for banks?
For a minimum of 100 euro you’re in luck: the Liechtenstein-based ARTEX enables you to co-own works of art and to trade shares in them. Read below why not even blockchain technology is needed for this and why reliable traditional clearing and settlement mechanisms are used instead.
The initial obligation to open banking has now turned into a dynamic international competition. Sven Siat, Head Connectivity in the business unit Banking Services of SIX, explains why reluctance will not pay off also for the Swiss banks: Those who do not provide up-to-date programming interfaces in the future will not have a lasting business model in the long run.
Like other business areas within the Swiss financial center, wealth management is facing major challenges. What adjustments to the business model are necessary? Find out which competencies will be helpful in connection with data and technology.
We keep you up to date on developments in the financial markets and provide background information from the world of SIX – directly in your email inbox.
Subscribe NowThe Future of Finance Is Now
The Future Has Already Begun at SIX
SIX guarantees stability for financial markets and keeps its promises to customers. At the same time, we constantly prove that we deliver innovation even during times of great change. The future of the financial industry is unfolding here and now before our very eyes.
The Future of Assets Is Digital
With the SDX digital exchange, SIX is building a fully integrated, trading, settlement, and custody infrastructure for digital assets in a regulated environment based on distributed ledger technology. This now also includes services in the area of decentralized finance, or DeFi for short. SDX Web3 services are directed at institutional clients and are concentrating initially on the largest applications in DeFi: cryptocurrencies, NFTs, and other asset tokens.
ESG Data: Already Indispensable in Investing Today
Investors are increasingly inquiring about how their investments or portfolios align with ecological, social, and ethical aims. However, reliable information on ESG (environmental, social, and governance) criteria is vital in the future not just for investment consulting, but is indispensable also for risk management and financial institution compliance. Sustainability criteria and transparency regulations for securities issuers and financial products are constantly becoming ever stricter. SIX supports its customers by providing them with consistent and comparable ESG data, including regulatory data as well as performance indicators and special ESG indices.
New Business Possibilities with Open Banking
Open banking brings banks and fintechs together, thus enabling the co-creation of new customer-centric solutions. In other words, with the consent of a bank customer, a bank can share data with a fintech or other third-party provider. This, in turn, lays the foundation for the creation of new services with added value. We are still in the early stages of a trend that will forever change the financial industry. bLink from SIX already ensures today that collaboration and the flow of data can proceed securely, efficiently, and in a standardized way.
The Latest Finance Technology for the Swiss and Spanish Financial Centers
SIX supports national and international startup companies from the world of finance that have ideas and solutions for new services, design more efficient processes, or aim to tap new customer groups. SIX FinTech Ventures is a 50 million Swiss francs corporate venture capital fund that invests in early-stage startups around the world. This enables us to support the Swiss and Spanish financial centers with cutting-edge technologies, innovative solutions, and revolutionary business models. For independent fintech startups that are also capable of growing on their own and which meet a true customer need, SIX is a partner on equal footing.
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