Like many other industries, the financial services industry is one that is transforming under the influence of advancing technology. Especially in today’s age of digitisation, the financial services industry is changing to accommodate for online and cloud-based service needs. As a result, a few tech trends have emerged from recent operations in the financial services industry.Keep reading to learn what these trends are and how technology is transforming the financial services industry.
Contactless and cashless finances
Advancements in technology have allowed for the shift from a cash-based economy, to one that is contactless and cashless. Although motivated by the 2020 coronavirus pandemic, the financial services sector has in recent times started to transition into contactless and cashless services for their clients. This is simply due to the convenience and accessibility of such new forms of payment.This has meant that both individuals and businesses are transforming the way they traditionally make payments. Even physical credit cards which have only grown popular in the last few decades are being replaced with systems known as virtual cards. Both individuals and businesses can now make cashless payments through their electronic devices, rather than with a physical bank-issued credit or debit card. Similarly, businesses can do so with virtual corporate card services.
The shift towards contactless and cashless finances is one to look out for as according to a Market Research Firm’s forecast report, the global contactless payment market size is expected to grow by $8 billion between 2020 and 2025, at a rate of 11.7% compound annual growth rate.
Technology has also facilitated the transformation of internal operations within the financial services industry. Rather than working from an office, many businesses in the financial sector are now choosing to have their employees work from home, for efficiency and pandemic safety purposes.Technology has heavily assisted this transition, with many employees needing VPNs to protect their data and company confidential information while working from home. 5G networks are also increasing in use due to their high network capacity and ability to transfer data much quicker than more commonly used networks now. Work-from-home ergonomic setups have also grown in popularity, with many financial sector businesses giving employees a personal spending budget to improve their working space at home.
Robotics and AI
Robotics and AI (artificial intelligence) are making their way into the financial services sector, through both a customer-servicing lens and a business perspective. Due to the relatively low cost of implementing AI into existing online services, versus its overwhelming positives, many businesses are now investing into the new technology as well.Robotics and AI are now commonly used in chatbots on financial service websites to help provide customers with 24-hour service and redirect concerns to the right webpages and assistance. From a business perspective, AI and robotics can also help with data analytics and software protection, to detect fraud and enforce any other regulatory compliances. Robotics and AI have also assisted businesses by facilitating voice commerce, AI advisors and biometric-based authentication features.
Tech trends and transformations the financial services industry
The financial services industry’s development is heavily guided by advancements in technology. It is through technology that many important changes have been made recently to the financial services world, including contactless and cashless finances, work-from-home systems and the rising incorporation of robotics and artificial intelligence (AI).