The top 5 Domineering Advances in Financial Services Technology
Fintech, mobile, and new platforms are driving a digital transformation of the banking industry. The traditional banking landscape has taken a U-turn in the next five years. Safeguard features such as advanced cryptography and biometrics are already acting as a protective layer against frauds and scams. This wave of disruption is unstoppable. Let’s take a glimpse at how the global megatrends in digitalization and IT department are affecting financial services industry.
1. Blockchain Technology
Blockchain technology is inherently revolutionizing banking and financial services. It decentralizes financial management from a central authority to a widespread network of computers. It has the potential to benefit various sectors, with its immutable ledger of apparently near-unhackable information. PSD2 Blockchain could be the key to the success of third-party financial services.
2. Open Banking
Open Banking is forcing large, established banks to be more competitive with smaller and newer banks, ideally resulting in lower costs, better technology, and better customer service. Through the use of networked accounts, open banking could also help lenders get a more accurate picture of a consumer’s financial situation and risk level in order to offer more appropriate loan terms. This comes as a great opportunity for financial companies to take the advantage of Open Banking.
3. Advanced ATMs
Subsequently, ATMs are coming with the new power of contactless payments, much like Apple Pay or Google Wallet. While some ATM innovations are already on the place, the inception of biometric authentication, iris recognition and other technologies are helping banks to achieve security by protecting against ATM hacks.
4. Flourishing Non-Banks
According to a 2016 report from market intelligence firm Greenwich Associates a large portion of banks resources is necessarily dedicated to security, compliance, and other industry-specific requirements, which has allowed non-banks — or financial service providers that are not regulated by the banking industry — to flourish. Since these non-banks or financial companies can allocate a large chunk of their assets to financial technology they might be able to pioneer at a much rapid pace as compared to traditional banks thereafter, attracting digital savvy customers in the process.
5. Automated Financial Services Employees
The advancements in financial technology will probably result in the reduction of in-bank personnel. A recent report from Citigroup indicated that a whopping 30 percent of bank jobs might be lost by 2025 due to the automation of retail banking services. And maybe, the bank employees inch forward as robo-advisors for effective money management.
In a nutshell, smart mobile technology and trends are driving finance & banking technological advancements on the roads of convenience, ease and simplification. And if you’re a fintech company or a government bank looking forward to augmenting your customer experience than banking and finance IT solution provider can be a right choice to go with.