Fintech or Financial Technology is what describes a new technology that is looking to boost and automate the delivery and usage of financial services. The Fintech landscape is changing at lightning-speed and Fintech software development has increasingly become more in demand. With every passing day, we encounter a dramatic change in the industry.
The transformations are critical since they impact everything that’s related to money, banking, and payments. Covid-19 has caused a lot of industries to decline, with only a handful that showed an upward trend and the Fintech industry is among them.
The pandemic has created a big surge in the market since both businesses and consumers started using contactless payments. While other industries closed shop, a Fintech software development company receives a high demand for services during this time.
In a few weeks, 2020 will soon be over. While we hope and pray for this pandemic to end, the coming year 2021 could prove to be a milestone year where we could witness path-breaking innovations in the financial technology space.
So, what are the top Fintech trends that would rule next year? Let’s find out.
Fintech Trends that Will Dominate in 2021
This technology has thoroughly altered the modus operandi of the financial technology industry. Transactions could be accomplished safely and securely with this cutting-edge technology.
Because of this, financial institutions and banks are adopting technology readily to leverage the many benefits. One important factor about the technology is that it’s not just cutting-edge technology, but a new decentralized finance philosophy as well that focuses on lessening a centralized procedure.
2. Robotic Process Automation
RPA for short could be defined as a process automation technology that uses digital workers or software robots to automate tasks that usually are done by humans. Already, the financial service industry has implemented RPA to cut costs and boost the overall efficiencies of an organization. Furthermore, financial institutions have adopted RPA digital workers as well, to automate different back-end office processes, like customer on-boarding, account maintenance, and closing, security checks, processing of credit card and mortgage, trial balancing, and a whole lot more.
3. Digital-only Banks
What are these? These are banks that provide different banking services, including international remittance, P2P transfers, contactless MasterCard without transaction fees, and with the ability to purchase various cryptocurrencies, such as Bitcoin, for instance, and so on.
Digital-only banks have become hugely popular in just a short time mainly because it offers utmost convenience to customers by getting rid of long queue waits, cumbersome paperwork, and the need to physically visit a bank.
4. AI and Machine Learning
Banks all over the world are now considering integrating Artificial Intelligence into their operations. AI is deemed to reduce 22 percent of the operational expenses of banks by 2030.
In other words, banks could save as much as one trillion dollars by employing Artificial Intelligence. Moreover, AI could be used in managing the growing cyber crimes by identifying threats and frauds.
5. Biometric Security Systems
Banking at our fingertips is made possible by mobile banking services and financial technology solutions. Nevertheless, it also raised a lot of security issues as cybercrimes are increasing daily.
Biometric security systems emerged as fool-proof and reliable measures that take financial security to the next level. It provides institutions and users with confidence that the data is protected and safe.
6. Open Banking
Another revolutionary and exciting technology, which brings banks and Fintech together via facilitating data networking across organizations. Open banking pressures banks to release data in a secure and standardized manner that makes information sharing easier between different authorized institutions online.
7. Regulatory Technology or Reg-Tech
It could be defined as the management of a regulatory process in the field by technology. The major functionalities involve monitoring, reporting, and compliance. It empowers organizations with the power to advanced software, which could streamline the process of compliance with current laws and regulations.
This year, almost fifty percent of all searches are voice-based, which gives a hint of what the industry would be like next year and its role in changing the sector. In banking, the voice-based search would help customers to access banking services easily, provide encryption ways while supporting communication with NLP-powered voice assistants. More and more banking institutions and organizations are adopting voice search, helping them save millions of dollars.
9. Mobile Apps Usage
Mobile apps, not surprising as others, are also gaining much popularity in the field of finance and technology and proved to be a potent trend in 2021. With the incessant rise of popularity of mobile applications, most financial technology companies have started to tie up with the best finance and banking app software development company to build impeccable digital solutions. Expect all sorts of innovations next year.
10. Big Data Incorporation
The impact of big data technology on the financial field is another thing that is to be taken into consideration by 2021. Big data is among the effective tools that the industry players employ to revolutionize the industry. On a wide scale, the technology is helping financial companies grow in a lot of ways, which include risk management, customer segmentation, and fraud protection.
In general, screen-sharing is the function in which one party provides access to another to share the screen of the device. With co-browsing, users could prevent others from completely accessing the device.
Rather, it allows users to share a certain web page with another to gain mutual access. This is a boon for the finance and banking industry since it’s extremely useful in banking software.
12. Payroll Process Disruption
The majority of consumers struggle from one paycheck to another. This has created serious money issues for a lot of people who rely on predatory lenders and payday loans asking as much as 400 percent rates. With Fintech organizations, others are improving the traditional payroll method with a flexible pay feature that enables employees to choose data to get their pay.
13. Unserved and underserved Focus
Based on the World Bank report, around 1.7 billion people are not part of any formal financial system. They have no bank account on their own.
This is the foremost aspect in which financial technology leaders are concentrating this year and onwards. Instead of joining the established market, Fintech start-ups try to enter new phases and gain financial backing from investors.
14. Asian Market Growth
The Asian market is quickly becoming the biggest adopter of financial technology. As new Fintech organizations begin to emerge, expect to witness great advances in the market by 2021.
In analysing last year’s events, China came up as the global leader in the industry. With the biggest population in the world, the country has 800 million internet users, which is a combined percentage of countries like Japan, Russia, Mexico, and the United States.
15. A-Rated Life Insurance
A-rated life insurance allows companies to employ technology in a way as to eradicate medical exams while making simple the writing and underwriting of a new insurance policy. Several Fintech start-ups already are implementing as much as a million coverage without medical examinations, and refer to the collected data on customers regarding prescription history, based on their medical questionnaire to be approved.
Fintech apps trend will continue to grow by 2021 and would offer banking facilities to the weak, unbanked, and illiterate section of society. The trend would improve financial inclusion by giving fast, convenient, and easy access to the unbanked.
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