As remote operations and contactless procedures are becoming
the new normal, the Fintech sector has been experiencing a rising hunger
towards moving to a 100% digital implementation of nearly all financial
products and services. It has also accelerated the demand for must-have
innovations and technologies that provide seamless and personalised banking
experiences to its customers, as well as guarantee a near-flawless execution in
managing fraud activities.
Moreover, the pandemic outbreak has also evolved the
consumer behaviour patterns and expectations, which forces the institutions to
embrace and leverage technology that not only nurtures but also strengthens a
A recent survey by Lightico in March 2020 found that 82% of
customers were concerned about visiting their branch in person and that 63% of
those polled were now more willing to try digital applications. As these shifts
are expected to be long-lasting, organizations are now investing in new tools
and technologies to speed up their business endeavours and be a step ahead from
Here are the top five technologies that will allow the
Fintech industry to enhance productivity and efficiency in automating the
Artificial Intelligence (AI) and Machine Learning (ML)
AI or ML has undoubtedly disrupted today’s Fintech world. On
one hand, AI plays a key role in providing a tailored approach to a customer,
on the other hand, it helps to identify customers’ ability to repay or
intention of fraud. However, the role of Data & Analytics in AI technology
continues to grow manyfold. There is a lot of data already available publicly
As AI performs better when there is a lot of data available,
this data is also constantly increasing and eventually making AI integration
more powerful. In the near future, 5G is expected to bring more people to the
internet ecosystem and will help to surge mobile payments and other digital
banking services. This means AI can leverage the maximum benefit of the
API platforms have evolved a lot in the past couple of
years, and it is still expected to grow at a faster pace. Open banking and the
use of APIs have already enabled partnership with financial companies to create
new opportunities for revenue growth, cost reduction, and better user
experience. It will further open up new possibilities and easier collaboration
with non-financial institutions as well, to discover better products for the
end consumers. For example, a person’s payment behaviour to a telecom company
can provide an input in his/her credit score data. Such partnerships with
different players can unfold unlimited opportunities to make life easier and
Regtech or regulatory technology is also expected to
function based on APIs, which will further make the overall auditing process
more transparent and robust.
User Interface (Chatbot)
User conversation space is undergoing a transforming stage
for the past few years, while ‘Bot’ is not a new buzzword for today but it is
still at a very nascent stage. These bots (chat/voice) will get matured over
time and be more effective in solving user problems due to the progress made in
natural language processing and speech recognition. These bots are expected to
be available 24/7 and can help to serve customers query/complaint/feedback
effectively and timely. This would provide a better user experience and also
reduce the cost of operation for the organisation.
In the past couple of years, Blockchain has been proven to
provide a secure, reliable, transparent, and completely automated solution.
This technology has been used in various projects across the world, and also
executed in different types of industries. Blockchain may still take some more
time to become a common technology to be used in all the sectors, but once it
is implemented it could be a game-changer. Financial institutions are using it
for smart contracts, digital payments, trade settlements, etc.
This would completely change and improve the way financial
operations are happening today. Blockchain helps to reduce cost and build trust
in the system. For the credit space, Blockchain can play a much wider role in
making the credit score more transparent, consistent, and globally valid.
The threat of cybersecurity is expected to increase
exponentially day-by-day and numerous innovations will happen in this area.
During the product development stage, continuous focus on cybersecurity will
help to make the product safe and secured at a higher level. Security testing
as a vertical, will also experience an increase in demand. The Fintech industry
deals with lots of data and it is expected that continuous innovation will
become a phenomenon, to advance the Data Privacy and Security framework.
While each of these technologies has the potential to impact
the financial sector, it is also one of the most critical sectors which always
have more room to improve and advance its solutions. As the industry
continuously aims to cater to the fast-changing consumer landscape and support
one’s financial well-being, innovation and technology-led changes will be the
key aspects to achieve those desired results.
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