Top FinTech Trends that You Must Know About
FinTech is one of the fastest-growing industries, with companies innovating in almost every area of finance; from data and loans to payments and credit scoring. With the help of financial technology, today banks and other financial institutions are increasingly creating futuristic products and services that provide an overall better banking experience for everyone.
From the service you use to the ones you provide, this cutting-edge technology is responsible for some of the most innovative and intuitive ways financial institutions interact with technology that truly makes their lives easier.
Discover the top five trends that’ll help your financial institutions navigate risks, cut costs, meet customer expectations and take your business to the next level.
Artificial Intelligence and Machine Learning:
Just like all other industries, FinTech is also leveraging the benefits of AI and ML technology in their work. Today, it is being used by FinTechs in the collection and analysis of data so that banks, credit unions, and other financial institutions can reduce credit risk, determine borrowers’ creditworthiness and make better decisions.
FinTechs can leverage AI to develop chatbots that simulate and process human conversations. It is used to conduct an online chat conversation via text or text-to-speech. These chatbots also help customers complete simple transactions like checking their account balances, making payments, or getting saving and investment advice based on their transaction history.
Machine learning in FinTech can evaluate large data sets of simultaneous transactions in real-time. Using ML-based systems, FinTechs can develop new credit scoring models by using past, present, and future data points of customers. With machine learning, FinTechs can recognize and mitigate the suspicious activity.
Open Finance or API:
Access to the most robust and real-time financial data on the open finance systems or API gives financial institutions the ability to access and use the most accurate, precise, and real-time data of their customers.
With an API, banks and financial institutions can integrate with multiple financial systems such as accounting, banking, and other financial systems and access different data sets through one single platform. Using this enriched data, lenders can better understand their customers’ unique financial needs and therefore offer relevant products and services.
This technology enables financial institutions to see deep critical insights into their customers’ financial health and offer the right loan product to the right person at the right time. API not only makes lenders smarter and transforms the customer experience but can also help in making intelligent financial decisions across the organization.
Digital Banking:
The rise of online banking has made it possible for consumers to bank wherever and however they want. Digital banking has significantly reduced the need for customers to physically visit their local banking branches. As FinTech entered the industry, many financial institutions have acted fairly quickly to accommodate new digital approaches and innovate their products and services accordingly.
FinTech is embracing the digital banking revolution by rationalizing, digitizing, and optimizing traditional financial services. Financial technology companies have the power to provide convenience to financial service’s customers. Offering the ability to access, use and move money via digital devices, digital banks’ software and apps lets their customers pay bills, see account balances, apply for loans and make purchases on the go.
Blockchain:
FinTech has transformed the banking and financial sectors by providing on-demand finance instead of old-school methods. With blockchain technology, the financial industry can improve security, lower risk, and save cost by bringing visibility and lowering friction.
From cross-border transitions to trade finance platforms, clearing and settlements, credit reporting, and more, the different blockchain applications are making financial and banking services faster and more incredible than they were before. Blockchain will be an extraordinary methodology for banks, credit unions, and other financial institutions as it will provide data integrity and also permit full exchange history for the clients.
References:
https://www.coxblue.com/8-fintech-trends-you-should-be-watching-and-paying-close-attention-to/ https://www.yodlee.com/fintech/trends-in-fintech
https://www.forbes.com/advisor/banking/benefits-of-digital-banking/
https://medium.com/@annoleksyuk/5-uses-of-machine-learning-in-finance-and-fintech-9cf4a7530695 https://marutitech.com/ways-ai-transforming-finance/ https://searchcio.techtarget.com/feature/5-blockchain-use-cases-in-finance-that-show-value
