The future of Fintech trends
Banks and other financial institutions have traditionally been slow to react to trends and adopt new technology. However, the arrival of new tech within the fintech industry has begun to change all that.
Banks have now started to collaborate with start-up companies in the fintech industry to help with the speedy application of new trends to their business in order to make sure they are not left behind by today’s rapidly evolving financial climate.
Financial institutions are continually faced with the potential for new disruptions due to upcoming trends, which is what makes it so important for experts to keep track of the developments to see how fintech will be shaped by them and how the industry’s future may be affected.
The move into AI (Artificial Intelligence) and automation that does a customer’s financial planning on their behalf is a major new trend in the fintech industry. Once an individual has outlined their financial goals, such tools can demonstrate precisely how those goals can actually be achieved.
Many financial institutions believe that AI tools are the way of the future, in spite of some criticism of bias.
In 2018, a study conducted by PricewaterhouseCoopers found that 52% of company executives have confidence in Artificial Intelligence tools to such an extent that they are heavily investing in the tech, with as many as 72% regarding them as a big advantage for their businesses.
For the banks, AI solutions can be far more crucial than customer tools such as robo-advisors or chatbots, and they can actually be used to help with AML and KYC procedures, which helps to cut down on risk and the potential for fraud. Within the next three years, it is estimated that AI will help banks to save over $447bn in total, with the majority of those savings coming from the likes of customer-facing applications and anti-fraud measures.
Cybersecurity and the issue of privacy
Ensuring that personal information is kept secure is vital to the industry – and fintech companies, banks and financial institutions are constantly looking for new ways in which to improve cybersecurity. Although it is almost impossible to fully prevent cyber-attacks in the evolving financial environment, due to the vast number of ways in which today’s customers are able to interact with their investments and money, institutions can make plans for how to deal with such breaches of security and ensure they can minimize any data exposure or other damage done when such attacks happen.
As well as making investments in technology that is specifically designed to help guard against cyber-attacks, banks and other such institutions need to go even further and talk to each other while sharing solutions and advice so as to reduce the risk to their customers to an absolute minimum.
It is also of paramount importance that both company employees and customers are educated about cyber-attacks and the need for cybersecurity.
Customers that have a better understanding of the risks involved will be more engaged with doing what they need to do to ensure their data remains secure, as banks and other institutions cannot do everything on their own.
For financial institutions and fintech solutions, another of the biggest issues is that of privacy. It is impossible in today’s world for customers to be asked to give their consent for everything because of the sheer number of online transactions and interactions going on each day.
The length and complex nature of privacy policies also results in many people either unwilling to read them or unable to understand them even if they do.
Customers are often offered the opportunity to sell their data by some companies but are usually unaware of the potential usage of that data and, as such, are very unlikely to actually get a good deal from such transactions. The issue of privacy is one of that is a growing debate trend in the fintech industry, and one that will continue to expand over the course of the coming year.
The coming of femtech
Femtech refers to a specific focus on women’s health issues and healthcare, with many venture capital companies beginning to see the wisdom in embracing the notion of health-oriented technology that is specifically aimed at women.
According to Bill Malloy, a successful venture capitalist within the fintech industry from Sway Ventures, which is based in San Francisco, the men who primarily run a lot of venture capital firms have struggled to understand the value of investing in femtech enterprises in the past, but that attitude is now starting to change. 2020 is likely to see a marked increase in investments in general femtech as well as new kinds of the technology.
Bill Malloy is also predicting that telehealth tools will be increasingly adopted by the mainstream in the next few years. Complete regulatory approval will likely soon be given to telehealth, becoming standard primary care options for most patients and helping healthcare to overcome major difficulties such as the accessibility of affordable quality care.
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