The fintech sector has been revolutionising the finance industry over the past decade. Advancements in technologies have led to a shift away from traditional banking and financial services towards convenient, customer-friendly, value-driven services, many of which are automated. You can learn more about what fintech means in the PDF attachment to this post.
Fintech has made financial freedom a possibility for everyone, making finance management more relatable and simpler to achieve. Non-traditional financial services are appearing everywhere, broadening the horizon and creating new and exciting opportunities for businesses and individuals around the world.
Business people working in the fintech world – such as Matthew Ledvina, director of a London-based peer-to-peer lending platform for UK-based property – often closely follow the latest advances in fintech. There are several trends that we are likely to see develop or begin evolving in 2019.
Cognitive Computing on the Rise
Cognitive computing has already been introduced to some level in many global and national banking institutions, as changing customer expectations are managed using the latest technologies. This trend for cognitive computing looks set to rise in 2019 and beyond, with more and more financial institutions moving away from traditional banking and towards a digital future. Cognitive technologies can be used to understand customer preferences more thoroughly, processing information from real-time insights to develop a deeper understanding.
Acceleration of Paperless Services
One goal of fintech is the generation of entirely paperless financial systems. In 2019, more and more customers will be able to conduct their financial business using their smartphone, negating the need to visit a bank or fill in forms. Digital technologies for electronic Know Your Customer (eKYC) procedures are likely to be introduced in countries such as India, where more and more individuals are beginning to use the internet to meet their financial needs rather than traditional banking. Offline Aadhaar could soon be a possibility, enabling customers to identify themselves securely without sharing their Aadhaar number or biometric information. The short video attachment explains what an Aadhaar number is and what it is used for.
Increased Use of Mobile
Humans across the globe are increasingly relying on their smartphones to deliver virtually any service they require, with financial services being no exception. In 2019 we can expect to see more advances in mobile banking and in mobile payments in real time. The ‘Internet of Payments’ is made up of a variety of innovative technologies including blockchain, digital currencies, eWallets and cross-border banking. Forecasters predict that mobile banking will be the number one preference for accessing banking services for around 35 million people worldwide by 2023. In 2019, banks are likely to begin to respond to this growing demand through the introduction of a ‘mobile first’ strategy for marketing new services and products.
Regulatory Challenges
As financial systems change and evolve, the regulatory environment will become more challenging. Banks will need a clear strategy for navigating regulatory requirements if they are to remain compliant. Staff will need to be trained properly to deal with requests for data access and this will need to be reinforced with written procedures to demonstrate compliancy with data protection policies.
Moving to the Cloud
To fully embrace new technological advances, banks will need to develop new strategies to deploy IT architecture in the cloud. Cloud-based solutions mean banks and authorised banking personnel can view all business and customer data on a single application. Financial institutions and banks have traditionally been resistant to cloud computing, but it seems likely that many will begin a stronger cloud uptake in 2019 to meet customer demand.