Interest-rate volatility, shifting trade policies and regional conflicts have added layers of complexity to corporate lending and cash-management functions.

“This year has [created] a lot of challenges with ongoing tariff wars and economic uncertainty…The volatility is a sign of something bigger. If the global economy struggles, the banking system also takes a hit, and credit costs will rise sharply, putting even more pressure on profitability,” comments Deepak Arora, SVP of Financial Services at HCLTech, during an episode of HFS Unfiltered Stories with host Saurabh Gupta, President, Research and Advisory Services at HFS Research.

Yet rather than pausing their modernization journeys, 97% of banks surveyed plan to continue, or only slow, digital transformation projects.

This resolute commitment reflects an industry consensus: sustained investment in technology is critical for maintaining competitiveness, even in turbulent times. At the same time, many incumbents still wrestle with legacy systems, which represent a significant barrier to achieving digital goals.

These dual realities underscore the challenge and the opportunity for commercial banks to balance resilience with growth and innovation.

Four pillars for purposeful modernization

Banks must modernize fast and with laser focus, around four interconnected success factors:

1. End-to-end value-chain expertise

From origination and underwriting to portfolio management and collections, banks need to partner with organizations that understand every step of the commercial-lending lifecycle. At HCLTech, we believe in being a partner for life and providing comprehensive services across strategy, operations, technology, client lifecycle management, selecting products and implementing products.

2. Technology leadership

Legacy cores often lack the agility and interoperability that modern banks require. Technology is in the DNA of HCLTech and we can help turn complexity into clarity with the help of technology.

3. Innovation and furure-proofing

Quoting former HP CEO, Carly Fiorina, Arora reminds us that “where technology meets purpose, progress follows.” This principle guides HCLTech’s approach to co-innovation and highlights how we work with clients to bring them the power of AI, Agentic AI, and data and analytics, so banks can really focus on data-driven decisions, enhancing revenue and customer retention and driving cost reduction initiatives.

4. Ecosystem collaboration

In a connected world, no bank can innovate alone. Partnerships accelerate progress and enable commercial banks to innovate faster and become more effective.

Together, these pillars help banks reconcile the tension between legacy stability and digital agility, laying a foundation for both robust operations and accelerated growth.

Three core priorities to “move the needle”

When faced with sprawling transformation roadmaps, CEOs and CIOs often ask: Where do we start? Arora distills the answer into three essential focus areas: 

1. Operational resilience

In today’s environment, banks must be able to absorb shocks and maintain service continuity while also reducing costs. Operational resilience extends beyond disaster recovery. It includes modernizing infrastructure, deploying automation and even building “digital twins of core systems to manage disruptions.” Resilience is not just about surviving disruption but laying the groundwork for spotting newer opportunities for growth.

2. Regulatory compliance and KYC

From anti-money-laundering directives to innocuous-account monitoring, the compliance landscape is only getting more demanding. To combat this, banks need to be proactive in terms of collaborating with regulators and continuously evaluating their models to achieve zero touch end-to-end customer experience on KYC and regulatory compliance and bring in the power of technology and GenAI to drive fraud detection and stay one step ahead of threats. Automating these processes not only reduces risk and cost, but also enhances client onboarding speed, which is an increasingly critical competitive differentiator.

3. Digitization and modernization

To meet the “crazy standards for digital convenience” set by FinTechs, banks must deliver seamless, personalized front-to-back digital products. Whether it’s real-time treasury dashboards, AI-driven credit decisioning or self-service trade-finance portals, every interaction should feel as intuitive as a retail app. By focusing on high-impact processes, like SME lending and cash management, banks can demonstrate quick wins that build momentum for broader transformation.

Concentrating on these three priorities helps banks avoid overwhelming checklists and ensures that each initiative delivers measurable progress toward both defensive stability and offensive growth.

Real-world impact

HCLTech is well positioned to help banks on this journey. Our Financial Services division has been growing steadily at about four and a half percent over the last eight quarters and the commercial banking division within HCLTech has been a big driver for that. In fact, we now work with six of the top ten commercial banks globally, we’ve got around 28,000 employees and we are now adding a billion and a half dollars of revenue each year.

Highlighting this experience, Arora shared three client case studies:

1. Working capital modernization

HCLTech worked with a European bank that aspired to become the best digital commercial bank in Europe. The bank enlisted HCLTech to “transform and digitize the core of the bank.”

Together, they formed a joint Transformation Office, re-examining 150 customer journeys and overhauling ways of working, culture and governance. Central to this effort was the working capital modernization program, designed to:

• Optimize the bank’s ability to deploy capital quickly and efficiently, so they can increase ROE and generate more fee income
• Integrate various systems of record and product engines, lowering cost and providing “real-time visibility into their capital requirements”
• Strengthen a broad suite of offerings, including SME lending, business lending, payments and financial markets, by driving self-service, straight-through capabilities
• Improve the customer experience of all their commercial clients

2. Next-gen digital lending

A European headquartered bank with a global commercial banking footprint identified SME lending and business lending as its focus growth areas and selected HCLTech as its transformation partner.

The plan was to jointly transform end-to-end business lending capabilities by advertising and personalizing customer interactions, developing alternate distribution channels to acquire new customers and reducing the cost to serve. This involved:

• Developing a next gen lending platform integrated with a specialized FinTech via alternate distribution channels. Integrated the platform with risk, KYC and CRM systems to ensure seamless data flow
• Using innovation labs in Amsterdam and Berlin to experiment with value propositions and technology adoption feasibility alongside the FinTech partner

The results included:

• Gained an enormous 2% of market share within 12 months of platform rollout
• Achieved 50% efficiency due to faster credit decisioning

3. AI-powered trade finance transformation

One of the largest commercial banks globally, a decade-long HCLTech strategic partner, was struggling with high volumes of manual paperwork and rising headcount in trade finance.

Approximately 1800 operational analysts were handling 4 billion worth of documents annually and this was putting an increasing pressure on cost.

To address this, HCLTech:

• Re-examined the entire customer journey of trade finance to create a unified, cost-effective solution
• Built AI intrinsically into the solution using Doc AI, GenAI-created custom AI/ML models for template-based document extraction
• Employed Gemini Pro and similar tools for signature verification on key trade documents
• Drove document completeness and accuracy before human-in-the-loop review

This resulted in:

• Automated 70% of the workflow, reduced operations staff by 30% and improved document-handling efficiency by 25–30%
• Cut transaction processing from 15 days to 24–48 hours, delivering both customer satisfaction and cost efficiencies

Balancing resilience with innovation

Throughout every transformation, technology must reinforce confidence.

By combining robust, AI-driven fraud prevention with intuitive, end-to-end digital journeys, banks can translate operational gains into deeper customer loyalty. In turn, loyal clients become advocates, fueling deposit growth and cross-sell opportunities that drive long-term, sustainable revenue.

The path forward for commercial banks is clear: move quickly but thoughtfully. Organizations that blend defensive resilience with offensive innovation, by modernizing platforms, embracing AI with a business focus and partnering across ecosystems, will be best positioned to capture growth.