“Whether you are the CEO of a prominent financial institution or founder of an emerging fintech product, the coming future will be drastically different from what you envisioned a year or two years ago - and that will surely be a good thing for your business.”
According to the Global Fintech Marketplace, the global Fintech market is expected to reach $190 billion by the year 2026, growing at the rate of 13.7 CAGR. This clearly shows that the Fintech industry is experiencing rapid growth worldwide, which is fuelled by both businesses and governments stressing the importance of innovation and the need to overcome challenges imposed by traditional methods.
With the current COVID-19 pandemic, we have entered into a new phase in the evolution of the fintech industry. Considering the pace at which the fintech disruption is taking place, it would not be wrong to say that Financial services, BFSI segment is witnessing the new normal.
Opportunities that accelerated the digital adoption in Financial Services -
COVID-19 outbreak has put digital transformation in full gear. There is a paradigm shift in customer demands and business operations.
The lockdown regulations and social distancing measures not only resulted in the increase of online shopping but also forced buyers to use contactless payment methods such as UPI to curb the spread of infection. Before the pandemic, customers were dependent on local branches of their financial firms for loans, mortgages, investments, and more. With coronavirus outbreaks, the doors of financial institutions were shut for substantial periods of time, but customers continued to enjoy a seamless and convenient experience thanks to digitalization!
Along with this, the huge number of payment options has also driven the growth of Fintech. Today, even the corner tea shop will accept digital payment through mobile wallets or money transfers from apps. There are many payment methods available today such as Apple Pay, PayPal, Google Pay, Airtel Pay, Amazon Pay, Paytm, WhatsApp Payments. And it’s not just the variety of options available, they are instant, secured, and reliable ensuring seamless business operations.
eCommerce businesses and brick and mortar stores need third-party Fintech firms/products that offer cloud-based solutions, point-of-sale hardware, and robust payment infrastructure to offer such a complex web of payment options.
Next-Generation Technologies That Will Further Transform The Fintech Sector
Artificial Intelligence -
AI combined with data solutions helps in analyzing the performance of financial institutions, automates organizations processes such as documentation, https://industryoutreachmagazine.com/wp-content/uploads/2021/08/download.jpgistration, and client communication, and also creates insights. AI has unexplored potential and never-before-done innovations that attract investors.
Blockchain
Blockchain helps fintech institutions deliver seamless and efficient banking solutions, from minimizing bureaucracy to reducing the costs that benefit both the clients and the banks. Moreover, Blockchain’s distributed infrastructure enables sharing information to enhance security without altering the data, ensuring data integrity. Say no middleman. Third party settlement is a thing of the past!
Machine Learning
Machine Learning tools detect common patterns among the existing fraudulent cases and evaluate whether a particular transaction displays specific characteristics. Since the banking industry holds a high risk for online frauds and hacks, it becomes essential to look for emerging technologies that mitigates such risks.
IoT
IoT utilizes networks of microsensors to assist financial institutions and banks in collecting and securing the customer’s financial data. Customer experience can be greatly enhanced with the aid of IoT as this technology eliminates bank waits. Moreover, data collected by IoT sensors and mobile apps will help financial institutions offer personalized services to their clients.
The Bottom Line
The face of the finance industry is changing rapidly, and the banks and the regulators of the industry are not only taking this into notice but also embracing the evolution.
The Fintech disruption will not only create opportunities for the startups that have emerged with innovative Fintech solutions combined with booming technologies such as AI and LM, but also traditional financial services that will effectively welcome this new paradigm.
