When it comes to business, technological trends have always been the name of the game. Technology does not only make our lives a lot easier but more efficient as well. With FinTech, it’s no different. In fact, for the past decade, FinTech startups have been shaking the very foundation of world banking and the more traditional financial services, changing the way we do business forever; thanks to FinTech and the Internet, the world has become one giant market. Consequently, new developments in FinTech technology will determine how the whole financial sector evolves further.
So, without further ado, here are some five FinTech trends that will play a major role in transforming the future of the financial sector as we know it.
Blockchain has outgrown its use as a technology merely for cryptocurrencies and is now looking to modernize the entire financial sector. Commercial applications are already out there, redefining the traditional relationships between customers, vendors, and suppliers; as well as whole business models, supply chains, and market structures.
Consequently, as more and more people place their trust in these financial transactions, banks will have to adapt and somehow integrate this technology into their system just to stay relevant; new regulations and laws will surely follow suit.
Additionally, this technology is not only good for lowering infrastructure costs — especially so for small businesses — but for also holding a solid security infrastructure in place. This will help shield businesses from the increasing number of cyber-attacks that are plaguing the financial sector at the moment.
Enabling smartphones to read credit cards was a major breakthrough in payment processing, but that’s just the tip of the iceberg. Top startups are already shifting their focus on developing a better and more streamlined digital experience for users. Consequently, payment processing will no longer be seen as a mere commodity but as a necessity by brands and customers alike.
We can already see the migration from more traditional banking institutions to apps and small devices. As a result, banks will have to turn to some innovative API solutions, real-time payments, and microservices to stay in business. Luckily, FinTech developers have made it easy for software engineers with their pre-set software libraries, tested services, and frameworks for developing new systems for monitoring, automation, and security. In turn, this will help reduce invoicing processing, lower the risk of fraud, and create a more agile financial ecosystem in the process.
Innovations in FinTech have already led to the rise of many new investment platforms. For instance, the Ever Forex trading platform allows users to track various global markets — such as forex, commodities, crypto, and more — from a single account, making it easier for users to engage in trade.
Now, as technology progresses, we may even see additional options getting integrated within these platforms; including managing your individual savings account, your DIY pension, shares, etc., all under a single roof. Consequently, what the Internet and eCommerce did to retail, investment platforms and FinTech will do to the financial sector.
Just imagine a life without financial administration and tax statements; everything will be fully automated. Moreover, thanks to mobile technology, we are now able to view our accounts while on the go by the use of smart apps and gadgets.
Seeing how these two technologies continue to evolve together will surely be an exciting prospect for the future.
Today, PIN authentication is the staple of credit card security. Yet, if you ever dealt with credit cards before, you probably know just how flawed this system really is; especially so if you keep your PIN on a piece of paper right next to your credit card. That is why FinTech experts have been working on developing a new system to fully replace PIN codes for years now; in 2015 they predicted that by 2020 PIN codes will become obsolete. Seeing how a few corporate giants, such as MasterCard, have already announced that, in the very near future, they are going fully biometric, one can safely say that the experts were right on this one.
As more and more companies integrate biometric authentication into their security measures, fraud and relevant cybercrimes will become a thing of the past.
Online payments have never been simpler. Thanks to PayPal, Venmo, and Stripe anyone can become a merchant nowadays; all you need is a stable Internet connection, some stuff to sell, and you’re good to go. Some small businesses and individuals are even selling stuff out of their garages to larger corporations such as Etsy, Shutterstock, and Amazon.
Also, according to Paysafe, by 2020 the acceptance of mobile wallets will rise from 29% to 62%. This trend will allow everyone to pay from pretty much anywhere. Meaning, eCommerce entrepreneurs will be able to sell their goods directly to their consumers (peer to peer), without any greedy intermediaries taking a slice of that pie.
With new FinTech startups being founded each day, it will be interesting to see how the situation develops further as we move closer and closer to a totally cashless society. Only time will tell.
Featured image via Imarticus.org