Emerging Technologies that will shape the future of Fintech Industries
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The pandemic was a game changer for the entire fin-tech industry at the global level. People have started making payments from cash to online wallets. According to the official report of “Research and Markets” - the fintech industry will grow at a CAGR of 26.87% in the year 2026.
Fortunately, the fin-tech financial players also catered to the need of the customers in a fascinating manner. For example: they recognized the customer’s complex hindrances while making offline transactions and presented a noteworthy solution of online wallet transactions at a nearby small vendor’s shop to the shopping complex.
Now, we have prepared a list of 7 key technologies that will be going to revolutionize the fin-tech industry at a fast pace. So, read the below article to empower your thought process:
7 Transformative Technologies Set to Revolutionize the Fin-Tech Industry's Future
The collaborative efforts of financial analysts and innovation resulted in creating a technologically enabled shift in the fundamentals of banking and trading. The growth into the fin-tech market has been generating massive employment opportunities as well as the GDP of many nations (like: India) enhanced due to the early adoption of the technology.
1. AI Will Transform the Decision-Making of Customer’s Financial Decisions
Artificial intelligence (AI) is revolutionizing customer financial decision-making through the use of data-driven insights. By analyzing vast amounts of customer data, AI algorithms can predict customer behavior and recommend personalized financial products.
For example: digital banking platforms such as Chime and Ally Bank leverage AI to offer personalized financial solutions to customers. Additionally, AI chatbots are becoming more prevalent in the financial industry, helping customers with basic banking tasks and answering common questions.
AI-powered fraud detection systems also play a critical role in protecting customer financial data from theft and other malicious activities. Moreover, AI is helping financial institutions to make faster and more informed decisions by automating routine tasks, reducing the need for manual intervention.
2. IoT - A New Era of Driving Trust into the Financial Universe
IoT technology is ushering in a new era of trust in the financial universe by enabling real-time monitoring and analysis of financial transactions. By integrating IoT sensors into financial systems, banks and other financial institutions can monitor and analyze transactions in real time.
For example: Mastercard has developed an IoT-enabled payment platform that allows customers to make secure and seamless payments with connected devices. In addition, IoT devices can help prevent fraud by monitoring customer behavior and alerting financial institutions to suspicious activity.
IoT also plays a critical role in enabling secure and transparent supply chain finance by providing real-time data on shipments, inventory, and other key metrics. Moreover, IoT is enhancing customer experience by providing personalized financial products and services based on customer data.
3. Blockchain: Securing Financial Transactions
Blockchain technology is transforming the financial industry by providing secure and transparent financial transactions through IoT. By integrating IoT devices with blockchain technology, financial transactions can be securely monitored and tracked in real time.
For example: RippleNet, a blockchain-based platform, uses IoT sensors to monitor the location and temperature of goods in transit, providing transparency and security in supply chain finance. Moreover, blockchain technology provides an immutable record of financial transactions, making it more difficult for hackers to tamper with or steal financial data.
Additionally, blockchain-based smart contracts provide an automated and secure way to execute financial transactions without the need for intermediaries. This provides decentralized access to financial services, making them more accessible to people who are unbanked or underbanked.
In the future, the combination of IoT and blockchain technology will continue to transform the financial industry, providing secure and transparent financial transactions.
4. Promising Future For Virtual Banking
Virtual banking has a promising future, with advancements in technology and changing customer behavior driving its growth. By leveraging digital technology, virtual banks are able to provide faster and more convenient banking services to customers.
For example: Ally Bank offers an entirely virtual banking experience, with no physical branch locations and 24/7 customer support. Virtual banking is also more cost-effective than traditional banking, with lower overhead costs allowing for competitive interest rates and fees.
Virtual banking can provide customers into various ways:
5. Utilization of Open APIs into the Fin-Tech Industry
The use of open APIs in the financial technology (FinTech) industry is rapidly gaining popularity and transforming the industry. Open APIs provide a standardized way for FinTech companies to share data and functionality with other systems and platforms.
By leveraging open APIs, FinTech companies can develop new applications and services and improve existing ones. For example: PayPal uses open APIs to allow merchants to integrate their payment systems with the PayPal platform, increasing transaction efficiency and reducing costs.
Additionally, open APIs facilitate collaboration and partnerships between FinTech companies and traditional financial institutions, allowing for the development of innovative products and services. Furthermore, open APIs provide a more seamless and integrated user experience, allowing customers to access multiple financial services from a single platform or application.
Moreover, open APIs can improve the transparency and security of financial transactions, enabling real-time monitoring and reporting of transactions. In addition, open APIs can provide valuable insights into customer behavior and preferences, allowing companies to offer personalized financial services and products.
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Open APIs also facilitate the growth of digital banking, with FinTech companies able to offer a range of services including payments, lending, and investment management. Furthermore, open APIs are enabling the growth of the Internet of Things (IoT) in financial services, allowing for the integration of financial services with IoT devices such as wearables and smart home devices.
In the future, the use of open APIs is expected to continue to transform the FinTech industry, enabling greater collaboration, innovation, and personalization of financial services.
6. Cloud Computing Focuses on Effectively Liberating Financial Services
Furthermore, cloud computing is enabling financial institutions to offer more personalized services to customers, using data analytics and artificial intelligence to provide tailored recommendations and advice., Moreover, cloud computing is transforming the way financial institutions collaborate, with cloud-based platforms facilitating partnerships and enabling the sharing of data and resources.
In the future, cloud computing is expected to continue to transform financial services, with the development of new applications and services, and greater collaboration between financial institutions and FinTech companies.
7. Hyper Automation Will Lower The Intervention of Manual Labours
Hyper-automation combines machine learning, robotic process automation (RPA), and other automation technologies to automate tasks. IoT devices generate vast amounts of data that can be analyzed by hyper-automation tools to identify patterns and automate routine tasks.
Hyper-automation can automate complex tasks such as fraud detection, credit underwriting, and regulatory compliance, reducing the need for manual labor. It also enables financial institutions to offer more personalized services, using data analytics and artificial intelligence to provide tailored recommendations and advice.
Furthermore, hyper-automation can enhance security and compliance, with built-in security features and automatic software updates. Moreover, hyper-automation can help financial institutions to reduce costs and increase efficiency, by automating routine tasks and processes.
In addition, hyper-automation can enable financial institutions to innovate and develop new products and services, by providing insights into customer behavior and preferences. Hyper-automation is also driving the development of new business models, such as micro-insurance and micro-lending, which provide financial services to underserved communities.
The integration of IoT and hyper-automation is reducing the need for manual labor and automating routine tasks and processes. As the industry continues to evolve, hyper-automation will play a critical role in its growth and success.
Time to Embrace Virtual Banking Services - Virtual Banking is a Necessity, Flexibility & Security
People who belong to the “Generation X” group experienced traditional banking systems that incorporated - long waiting time in queues, system downtime issues, frequent bank holidays and more.
However, people who belong to the “Generation Z & Millennials” group cannot tolerate the issues (long queues, server issues, etc) of traditional banking facilities. To fascinate the interest of these groups, the use of virtual banking is the greatest gem to capture the interest of the customers.
Global Governments need Cyber-Security Parameters to Counter Cyber Threats
Cybersecurity threats are a growing concern for global governments. Governments need to establish robust cybersecurity parameters to counter these threats. Collaboration between governments and private industry is crucial for effective cybersecurity. Governments need to prioritize cybersecurity in their policy-making and budgeting processes.
Cyber attacks can lead to data breaches, financial losses, and damage to critical infrastructure. For example: the recent SolarWinds hack impacted multiple government agencies in the US. Governments need to invest in cybersecurity training and technology to stay ahead of cyber threats. This includes implementing strong firewalls, encryption, and multi-factor authentication.
The Final Words
The Fin-Tech sector is experiencing tremendous growth and it processes a great opportunity for new firms or companies to develop a fin-tech application to cater the customer demands. At Amplework, we can mutate your idea of developing a fin-tech application into reality.
We have tech-enabled infrastructure with all the latest facilities and our team members incorporate well-defined understanding to cater to the diverse requirements of our clients. So, forward your requirements to us now!