The fortunately, in one of its statistics update, claims that the traditional financial institutions are fearful about their existence as the advancements in technology is holding the standalone Fintech companies stronger day by day. It is said that about 88% of traditional financial institutes dread about losing business to their technology equipped counterparts, in the next five years.
The Fintech companies are leading the market as it has acquired $111.8 billion of investments across the globe in 2018, let alone 2019 and the years coming ahead. On the one side, the fintech startups are transforming the digital arena of payments; on the other hand, it may make the conventional banking and financial services company handover the market share to digital nomads.
It may again be the example of cutthroat competition the way online ridesharing apps provided to the local cab operators. The mantra is simple, update your business, turn on to the digital mode, or you will be a part of the history. The same goes true for the brick and mortar stores that are still in business because they have ensured their web presence.Web development is the solution to all traditional businesses to join the digital revolution, or they have to innovate within their fields, else staying at the same old premises with the century’s old marketing strategy that passersby will find and shop from you is not working anymore.
The result of such advancements and transformation in fintech for us as a consumer would be a dramatic decrease in cost and time in availing financial services. Let us look for the positive aspects and find the latest trends we have to keep an eye on.
For any financial institute, to know the grave concerns of their audience is difficult so that they can address a solution through customized financial solutions. With big data and machine learning, they are capable of acquiring, processing, and preserving from users, and keep learning about their behavior.
The financial services companies can now grab user details from their social media interactions and browsing history. As a result, companies are capable of personalizing user experiences by showing products that tap into their interests and the things they are looking forward to.
Banks and most of the businesses in the consumer industry have to deal with so many customer inquiries. It requires them to set up dedicated staff members or a complete call center to keep answering the questions that may not directly benefit their business. The artificial intelligence relieves the financial institutions in this hassle with modern-technology equipped chatbots. These virtual assistants are smart in understanding the user queries and providing them with the most viable answer.
According to multiple studies carried by financial service providers, the AI-powered chatbots are capable of minimizing user interaction time from dragging it down to one minute from five. There is immense advancement in recognize text and speech, and processing the natural language for a computer. This results in the speedy processing of user inquests. Furthermore, the chatbots can be employed around the clock thus providing 24/7 customer support to users without deploying a complete team of the proficient and expert support team.
With blockchain technology, financial institutes can transform their data and confidential records in immutable computer files for preventing theft, loss, or inappropriate use of data. The financial industry is experiencing a boom in recent years because of the blockchain technology as it may successfully deter identity theft of millions of consumers and prevent fraud. It is expected that the use of blockchain is prevalent for financial organizations. It is about to streamline the exchange of contacts, digital payments, and securing the user identity and trading in shares.
Innovation in m-commerce
Mobile commerce is another big thing for financial organizations as eCommerce has moved forward in online payments from desktop computers to smartphones and mobile gadgets. The consumers now feel safe and comfortable while browsing products on a device of their own and over a cellular connection. They are still reluctant in sharing their financial details like bank accounts and credit cards. To which, the mobile payments are the most viable solutions.
To mask their financial deals, consumers are prone to use electronic wallets for making payments over the phone such as PayPal. Seeing the advancement in mobile payments, internet giants like Google, Ten cent, Alabama, and Apple has devised digital platforms on their own.
Furthermore, these platforms are made stronger by restricting access via face recognition or fingerprints. China has adopted the technology and using it effectively across the country. Such as WeChat pay or Alipay are used by hundreds of users for their day to day buying without jeopardizing their financial secrecy. The financial institutions are also adopting the recent technologies to transform the conventional payment methods into a digital one to provide secure and reliable solutions.
Growing digital-only banks
The increase in mobile gadgets and easy internet connectivity is making the users more reliable on digital wallets and online banks. They need to avoid physical interactions for meeting their day to day financial needs. Like paying the energy bills, submitting college fees, etc. the user’s everything to be done at the tip of their fingers.
This ease and comfort, and financial freedom fear to replace the conventional banks with digital-only banks. The traditional banks may require a lot of paperwork and may want the user to appear personally for most of the authorizations. Whereas, the digital-only banks suffice most of the consumer needs digitally. Therefore, they don’t need to open a branch or physical office. This is giving an advantage to the digital banks as they can offer services on subsidized prices and attract consumers in pursuit of better interest rates. The same report issued by Fortunly speculates the digital payments to reach $4.8 trillion in 2020.
New technology is setting new standards in the financial services industry. The people who were fed up with the tiresome banking experience are adopting the digital experience quickly in pursuit of saving time, energy, and cost. The latest trends show their likelihood of making the financial sector a paperless economy.