All developing technologies beneficial for banks and other financial organizations are included in the fintech or financial technology industry. The fintech industry has revolutionized traditional financial services, from ATMs to the latest trend of open banking app development.
The banking sector may automate many company procedures and improve the client experience by integrating digital transformation technologies. The fintech domain gives a helping hand to the BFSI industry when it comes to operational difficulties like budgeting, customer assistance, and fraud detection.
This is one of the reasons why many financial institutions have begun to integrate FinTech into their current systems. Fintech is expected to rise by 25 to 30 percent between 2019 and 2025, according to official projections. The financial business is growing internationally, primarily to digital transformation trends.
The following are the most important digital transformation trends affecting the fintech industry:
Like many others, the financial services business is undergoing fast transformation, notably in digital. Marketers are paving their route with unique, creative, and new concepts. As a result, companies are beginning to see the value of digital for engaging customers on the outside and improving internal procedures.
Leading financial service businesses credit 19 percent monetary growth to their AI projects, according to a study paper titled “Why AI is the Future of Financial Services.” In conjunction with Machine Learning (ML) and NLP (Natural Language Processing) ideas, AI has revolutionized financial procedures.
However, it plays a critical role in identifying and forecasting fraud. Credit card firms and lending institutions enlist the assistance of an AI app development firm to obtain innovative solutions for conducting background checks and meeting regulatory requirements.
Furthermore, advanced AI efficiently protects losses resulting from rising cybercrime. By giving actionable data to the company’s management, this technology also helps to improve the customer experience. In conjunction with other developing technologies, AI has the potential to improve crucial processes in the finance business.
Blockchain is a game-changing technology that underpins cryptocurrencies. However, as a powerful technology, blockchain can revolutionize financial businesses’ core procedures efficiently. This is why $552 million has been spent on this technology by financial service companies. Blockchain and its related technologies have a lot of potentials to expand and change the financial services industry in the future.
Data and smart contracts may be audited using a centralized, secure ledger system based on blockchain technology. It also boosts user or consumer confidence by enhancing transparency and lowering the chance of human mistakes. As a result, blockchain technology is used by numerous financial organizations, including microfinance firms and even stock exchanges.
Chatbots for a Personalized Experience
While providing quick and secure digital payment options, a personalized experience is essential. People prefer to utilize applications that provide a great user experience by providing all the required features and smooth functionality. Chatbots powered by AI is beneficial for providing a customized experience.
These chatbots may operate without human interaction 24 hours a day, seven days a week, and quickly provide clients with all relevant information.
Advanced chatbots can provide consumers with a human-like conversation experience, fix difficulties, and receive feedback. Fintech organizations may use AI technology to gather data and analyze it in order to serve their consumers better.
Chatbots may be used by banks, financial institutions, and even insurance firms to provide better services and assistance to their consumers.
Chatbots will become more clever in the coming years as they digest more data in less time.
Disruptive Technologies as a Source of Innovation
Consider PayPal, Google Pay, and ApplePay as examples. All of them are instances of cutting-edge digital payment methods. These eWallets or mobile wallet programs have quickly gained traction as customers’ paradigm shifts from old, inconvenient banking methods to easy digital services. The success of these innovative products has prompted a slew of fintech businesses to develop similar user-friendly online transaction solutions.
As a revolutionary concept, we may anticipate open banking to bring upheaval in the fintech sector next year. Other disruptive technologies, including the Internet of Things, can bring breakthrough finance solutions to the market.
The integration of digital technology into all aspects of a business is known as digital transformation. It has a significant impact on the way a company runs. The impact of digital transformation in financial services may be found in a variety of industries: It helps firms to upgrade outdated processes, streamline operations, improve security, and boost profitability.
In a nutshell, impact of digital transformation financial services industry trends is having a big influence on the fintech industry. Through fintech app development, banks and other financial institutions worldwide have begun to reap the benefits of digital transformation and automation. Traditional financial service companies must adopt new business models in order to alter their operations and stay ahead of the competition.
The financial services industry is going through a massive digital shift. The way financial services businesses function and how their audits are managed is being transformed by new technology.