Fintech has changed how we bank, invest or buy insurance policies in the last few years. It has not only made financial products more easily available and financial transactions more convenient, it has also brought in cost benefits to the customer. We take a look at five Fintech trends that will shape your finances in 2020.
More use of AI: AI is already being used by financial service providers in terms of chatbots that not only answers your queries, but also provides additional informations about services and products. It will be increasingly useful for applying services and products online. With improved AI capabilities, most of the work that a person used to do at the back end will be automated. Other uses of AI will be in the area of analysing data using enhanced analytics. For example, it can be used to analyse a customer’s data based on social media history to deliver personalised financial solutions.
Robo-advisory to play a more important role: Robo-advisory is in its nascent stage, but we may expect it to be an important part of financial offerings. Fed with data, robo advisors can provide customers with customised portfolios at the fraction of the cost. While you may choose a robo-advisory model which replaces the traditional advisor, companies will look to offer a blended solution to meet the needs of the customer and stay ahead of competition. Going ahead, robo-advisory will also play a significantly colossal role in personal finance management.
Focus on collaboration: With Fintech start-ups revolutionising the financial space, banks and other established players used to initially see them as a threat. Now, with time the threat has been substituted by their willingness to collaborate with start-ups to bring Fintech innovations to its customers. Many established financial brands are looking to invest in Fintech start-ups too and partner with them.
A tool for financial inclusion: Fintech has already played a key role in financial inclusion and that is only going to get more pronounced in a country like India where a large section of the population often does not get access to financial services. For example, launch of digital-only banks can take banking to people in areas where there are no physical branches. The Government can also play a big role here, making banking services and loans available to the otherwise unbanked population who do not have a digital footprint, proper documents or a borrowing history by using technology and big data.
Blockchain going mainstream: When it comes to Fintech, one cannot but mention Blockchain and how it has the potential to change our financial lives. One of the least understood of technologies, Blockchain can make the financial services industry more efficient and secure, saving the industry significant costs in preventing fraud and identity theft. We can expect to see the use of Blockchain in digital payments, smart contacts and a variety of other areas.