Over the past decade, financial service providers have invested heavily in enhancing the user experience offered by their digital products–an effort that has driven significant advances in how such products look, feel and operate on the surface level, or “above the glass.” But for the evolution of digital financial services to continue over the next ten years, providers will need to look deeper, focusing on modernizing the underlying systems that power those offerings and more effectively using data to power next-generation financial capabilities, according to Galileo CEO Derek White.

“In order to enhance the end-user experience above the glass, the next decade is about below the glass; improving the technology and infrastructure to unlock data and create more intelligent interactions,” White told attendees at the recent Fintech Americas conference in Miami.

And in the context of next-gen financial services, the more intelligent the interaction, the fewer actual humans need to be involved, added White.

“One of the principles in designing new technology is that it should be designed in such a way that there's only one human in the loop, and that is the end user,” White noted.

Appearing alongside White was Miguel Santos, CEO of digital core banking specialist Technisys, which was acquired by Galileo’s parent company SoFi Technologies Inc. earlier this year.

Santos agreed on the growing primacy of intelligent, tech-powered financial services interactions, which he likened to the capabilites of a self-driving car.

“We're going towards a ‘self-driving’ bank model, where AI and other technologies are helping us bring better experiences and more adaptive products and offerings to customers,” Santos noted.

To enable that level of automation and personalization, user data is crucial–and while financial service providers traditionally have been quite good at collecting that data, less progress has been made on effectively leveraging it to improve user experiences. Inefficiencies in cleaning, storing and identifying which data is relevant have hindered the process–particularly for larger financial institutions using legacy tech systems, White said.

“Financial institutions at scale with 10 to 20 million customers will have 10 to 15 billion interactions with their customers,” White noted. “Across financial institutions, on average about 15 percent of those interactions are actually intelligent, meaning they're actually using the data that they have and connecting it back to the customer at the point of interaction.”

Improving how customer data is used requires modernizing core systems–and while many financial institutions have patched on middleware to address outdated tech stacks, that approach likely won’t be sustainable over the long term, especially amid competition from newer market entrants running on digital-native core platforms, Santos observed.

“Many financial institutions have had this antiquated core and they've been able to hack that with the middleware,” Santos said. “But can that be sustained? Can they continue to keep that core and get to where they need to be? Or do they need to start looking at new engines that are going to be driving these types of operations? I think the answer is pretty easy.”

More nimble banking tech platforms also offer the advantage of much faster iteration of new data-based tools and services compared to legacy systems.

“The average creation cycle in a major financial institution is about 2.2 years; on a modern technology platform, it can be done in a matter of hours or weeks,” White noted.

For many financial services providers, effectively leveraging data to drive below-the-glass improvements in their digital offerings will require making investments in new technology and re-imagining how such products are designed and built.

It’s a tall challenge–but one that must be met for those who want to play a role in the next phase of digital financial services evolution, which will be truly user-centric on both sides of the glass.

“We saw all the innovations in recent years on the user experience side and in the digitization of processes,” said Santos. “But in the future, we're going to be seeing innovation at the product level. And if you can't do that, it's going to be impossible to compete.”