Eight emerging technologies shaping the FinTech industry in 2021
by Analytics Insight
September 18, 2021
In a decade, FinTech organizations have used innovation, inventive cultures, excess data and advanced analytics to change the financial ecosystem. From payments, infrastructure and access to financial services to distribution and sustainability components, FinTech companies’ solutions have impacted the entire banking industry.
At first, traditional banking providers viewed FinTech solutions as competitive threats. But that hasn’t stopped the development of FinTech companies from impacting the action plans of former banks and credit associations, there is a growing trend to team up with FinTech providers for faster development of solutions. advances desired by buyers and organizations.
The eagerness of users to try new computerized financial services has grown dramatically due to the pandemic, accelerating innovation within the financial industry. With the closing of branches, both conventional and unconventional banking service providers expected to meet the demand for a fast and consistent solution that simplifies banking operations.
Many emerging technologies in the FinTech industry have a direct impact on the provision of retail banking products and services. These trends (and others) should be seen as essential planning actions, as each technology has an increased degree of urgency as the banking practices of users and businesses continue to evolve.
Here are eight innovations that will have a significant impact on the financial sector in the future:
Mobile banking has made significant progress: from SMS Banking, which first appeared in 1999, to today’s smartphone banking apps that allow you to make digital payments and manage banking and financial services from anywhere. wherever and everywhere in the world. Along with this, mobile banking also provides an interface for the end user to expand the horizons of banking as a platform.
Cryptocurrency is the main reason the majority of people have learned about blockchain. In addition to using cryptocurrencies for private and fast online transactions, the blockchain offers a secure, transparent, stable and reliable ledger to report agreements, transactions and records. Technologies such as blockchain bonds, blockchain clearing, and settlement frameworks have been effectively used to make intrabank and interbank transactions cheaper and faster.
Combined with artificial intelligence, big data uses all old and new information to find hidden designs for better fraud detection and better risk management. Apart from that, big data insights help banks understand customer behaviors and create products and services according to their needs.
Artificial Intelligence (AI)
Artificial intelligence helps banks examine their big data in order to improve the quality of solutions and decision-making. The latest trend in AI is to use intellectual abilities to navigate a stack of unstructured content and data to produce more information. In the future, AI chatbots or virtual assistants will be able to perform repetitive activities, like making small transactions, giving financial advice to clients, etc.
Regulatory Technology (RegTech)
Businesses use regulatory technology or RegTechs to improve their ability to monitor, report and comply with regulatory requirements. With the help of big data, cloud computing, AI and predictive analytics, these start-ups are able to automate compliance tasks, reduce the risk of fraud, seamless authentication and identity management. Regulatory technology can also help banks increase transparency and consistency while reducing compliance expenses.
When it comes to data security and safety, biometric technologies are the most trusted innovations of all time. Why? Because they use a person’s unique physical characteristics which include fingerprints, retina, face, voice, and other forms of recognition to enhance security and identity verification that help banks protect their clients, to avoid cybercrimes, etc.
Open Banking Application Program Interfaces (API)
Open banking application program interfaces (APIs) will affect the traditional banking model more than any innovation. Thanks to open APIs, banks offer customers and partners more transparency and access to banking information and allow the creation of new value chains and administrations. Until now, Banking-as-a-Service was considered the main model of how FinTech start-ups influence open APIs to create new administrations and new products that further develop the financial experience of buyers and create esteem. But Banking-as-a-Platform is now the next open API model, which allows banks to offer different third-party financial services to customers. In addition, banks can control customer information and guarantee the best quality of service on their platform.
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