Like all others, the fintech industry has been facing its own unique challenges, undergoing rapid changes due to the ongoing pandemic. If you are also largely dependent on the online atmosphere for your purchasing decisions, then you are most surely going to face some radical transformations coming on the way.
If you are considering a career in finance or further studies in MSc finance and investment, then this is the right time to proceed. Read this article to find out the trends that will shape the future of investment and finance by 2022.
End to end digitization
Digital-only banks are now possible, with banks existing entirely virtually and offering coveted services like contactless Master Cards, P2P transfer, global payments, and some are also offering the opportunity to buy or sell bitcoins and other cryptocurrencies that are once again on the rise. With such innovative new takes in the financial sector, the world is sure to take notice. Digital-only banks have several advantages like – one does not have to spend much time visiting brick-and-mortar banks, no paperwork, no cues. These banks are growing in number and revenue globally. Tech companies are also likely to extend their financial services, with more automated platforms lending faster credit approval for customers.
Blockchain
Blockchain has been groundbreaking in the field of financial technology. While the initial application of blockchain was mostly around cryptocurrencies, it now has broader applications and is used in improving financial products. In simple terms, blockchain is a shared but encrypted database. It allows the banking process to become faster, at the same time, being less bureaucratic. It is assisting in financial services like accelerating the process of loan-approvals, management of loan payments, establishing connection between private lenders and borrowers, bringing more control to the borrowers on their loan, etc.
Increasing use of AI and ML
Machine learning and AI form the very fundamentals of fintech with its innovative takes, they are increasingly incorporated by fintech industries into different segments. Lenders can benefit from the automation that technology brings into the complex process of loans. AI and ML can also do extremely crucial functions like credit score checks, fraud checks and alers, automated loan offers and generations. AI is projected to reduce banking costs to large extents, cutting down about 22% by 2030.
Customer-centric practices
While traditional banking has drastically reduced in-person communications, the new-age banking and lending business is based on absolute zero contact, over a digital platform. Consumers interact via a digital interface with their banks and do the needful. Most consumers today have moved into internet banking and most also prefer the fast procedures of mobile banking. The digital interface does not necessarily have to be all menus and buttons. It can certainly be interactive and intelligent like a chatbot. Customers will no longer have to wait for human representatives to get free every time they need some help. It also helps to reduce the workload of the employees without having to compromise on the quality of the service.
These financial trends are likely to impact everything from payment transactions to banking. It is expected that blockchain will see a huge rise at this time, exploring newer opportunities via digital wallets. If all regulations and security are maintained with set and expected standards, these changes are likely to be universal, welcomed in most parts of the world.
