Financial technology or FinTech has experienced unprecedented growth over the last few years. The field has seen rapid developments with users embracing the technology, thanks to service providers mitigating risks and increasing security around online spending. But what exactly is FinTech?
As the name suggests FinTech is the amalgamation of finance and technology to devise innovative solutions for businesses and customers. Bringing financial services to the forefront, FinTech uses different technologies like artificial intelligence, biometrics, eCommerce, blockchain among others. FinTech is helping businesses easily interact with their customers, suppliers and employees more effectively. Consolidating different technologies into one solution, FinTech has now enabled financial services to be at every user’s fingertips. While 2020 has witnessed a meteoric rise in the number of individuals using FinTech, the future is bound to be brighter. Let us look at some of the trends that are bound to gain pace for 2021:
The financial industry is driven by the demands, needs and pain points of the users it serves. This needs a considerable amount of financial awareness because only when one is aware, will they explore the endless possibilities of FinTech. Even with endless possibilities, FinTech has a steep curve, both in terms of learning and attesting trust. With the growing pace at which FinTech is expanding, the world is bound to financial education become a norm among primary education. Moreover, numerous FinTech firms are bound to invest heavily into user education and awareness, to ensure that financial literacy becomes a norm in every corner of the world.
Biometric security systems
One of the biggest caveats seen among the FinTech trends is the increased concern for security and safety. The growing number of cybercrime cases is a testament to the increasingly complex and risky nature of Fintech. However, the FinTech industry is one of the first to embrace technological innovation and the same can be said about the security measures that are being undertaken. Biometrics is one of the best ways to ensure financial data and privacy and is secured on every front. While 2020 has already seen a surge in touch-based solutions, 2021 is bound to see contactless solutions, especially during a time when physical cash in any form is becoming obsolete.
FinTech is shaping the way people interact with money. While banking institutions were imperative for processing any financial transaction earlier, FinTech is enabling financial freedom and giving the decision-making power to the user. From where to invest the funds to dispersing a loan to handling the account, FinTech helps users in taking their own decisions swiftly. Moreover, FinTech is harnessing the power of AI and machine learning to help customers better manage their funds by undertaking advanced decisions based on different debt and equity management solutions.
One of the FinTech trends that is bound to take flight is open banking. FinTech is harnessing technology to bring banks and financial institutions to work together to ensure data on every front is secured and standardized. It also allows customers to control their financial and banking information from various third-party applications. By working in tandem, open banking is bound to beneficial to the end customer who gets to look at a consolidated view of their accounts, get access to open banking products that will enable better financial decision making, improved long-term wealth management and lowered debts, which together has a cumulative effect on the health of the financial institutions and the economy.
Most of the technological innovations depend on the demographics of the largest base of users. And today, it is Gen Z that demands the maximum number of attritions and innovations in technology. Voice assistants have already gained increased relevance in today’s world, and with AI-powered voice technologies, the world of FinTech is bound to see a tidal shift. As a part of the biometric security system, FinTech is also enabling voice payments. From automated support to set up numerous activities like managing payments, disbursing loans, carrying out verification, voice-powered assistants will become one of the most relevant FinTech trends in the coming year.