How about making the best use of technology and carrying out all your daily tasks efficiently?
Maybe it is scheduling an appointment with a doctor or calculating finances for an entire city, technological innovations have simplified the processes involved. Various sectors use advanced software to deal with the system’s intricate details and apply it in drafting the organization’s actual functioning.
One of the sectors bringing about the use of technology in real life is finance.
The term “Fintech” is the blend of the words “Finance” and “Technology” and goes beyond literary means. In a real sense, it means the finance sector processes that can be planned using computers and financial management for an individual or a company in a digitalized manner.
There are various emerging trends in fintech development, some that have been documented well while others are yet to be researched.
The Current Crises the World is going through
The world has witnessed the COVID-19 pandemic, and it has significantly affected every department possible out there. The finance sector was also negatively affected, which has churned out new fintech development trends for 2021 and beyond.
Given that the people couldn’t carry out their financial proceedings by going to the banks during the pandemic crisis, they turned to online banking and virtual transaction programs. It has become a norm to manage one’s financing sitting at home, and studies conducted revealed that people are more confident about the digital transactions they make daily.
Agency Banking for Boosting Consumers for the Banking Sector
Agency banking is also an emerging concept, something that will bring about an increase in the number of consumers for the banking sector.
According to a recent survey, around 1.7 billion people aren’t still exposed to any kind of financial institution. Introducing the basic terminologies of banking to them would lead to heightened curiosity, ultimately leading to an upward trend for the customer graph.
When the Fintech apps make their way through even the population’s illiterate section, then a real justice can be done to the banking facilities marketed?
Below is a list of the latest trends of fintech development that are probable to emerge in the upcoming quarters of 2021.
1. Online banking will become a tradition to last generations
Who would want to spend time and complete tedious forms to cash in a cheque when the same can be done via online platforms?
Online banking is slowly on the rise since nationalized as well as private banks have opened their authentic online portals for customers. The pandemic provided the push needed to create the boom in the virtual banking sector, and now every other individual is accustomed to digitalized financing.
The simplified app user interface, the 24/7 available help-lines, and chatbots for simple queries are some developments that have much helped the smooth transition from offline to online banking.
2. The older population is favorably turning towards online markets
As businesses and retail shops took a hit during the quarantine period, online shopping was sought after. A study conducted showed that people between the age groups of 30 to 60 years were the ones who ordered the most amounts of supplies from online shopping sites like Amazon and Flipkart.
Also, they preferred carrying out transactions digitally rather than handing out cash at each junction. This scenario portrayed a population curve shifting towards a virtual mode of payments and is undeniable proof that most of the earning population is adopting fintech development.
3. Financial firms and credit unions are integrating technology with finance
Big organizations are starting to recognize the pivotal role that technology will play in the finance sector and take action to resolve software issues. Each of these institutions’ research and development departments is working on similar modules that will offer the ultimate service regarding their customers’ financial decisions.
Today, almost every major institution has its website and mobile application available to directly connect with its consumer base. This pattern will only turn advantageously ahead in the first financial quarter of 2021.
4. A reorganized book-keeping system, i.e. Blockchain, is gaining popularity
The question “How can financial technology change the world?” is answered right here. The thousands of transactions that occur within a day cannot be documented well if there is no proper system.
Offline book-keeping is a tedious task but requires a lot of input from various departments and a sound mathematical mind to operate all the documents.
A blockchain offers a decentralized system to organize data as well as reduce the error margin to a bare minimum. This change is in favor of the customers as they can now track their transaction history with ease. Also, as it is online, everything is transparent and crystal clear!
5. Remittance platforms promising low-cost expenditures are the next big thing
To send money locally or internationally has become quite a hassle, and customers tend to be dissatisfied with the entire process in general.
Many remittance platforms are now coming into existence that promote low-cost programs to direct money anywhere. Also, if one doesn’t want to open a bank account to send money, he or she doesn’t have to!
Some remittance platforms don’t require a bank account and also give a fair exchange rate.
6. Including AI for data interpretation on a broader scale
Artificial Intelligence (AI) is gaining momentum in many fields, and it is also gaining popularity in the finance sector.
Internal processing of data requires labor, and AI can easily cut down this cost to half. Each department in any financial institution can use AI to reduce the workforce needed and guarantee low error in the figures.
It is beneficial not only to big companies but also to small-time investors who can analyze and interpret data universally and make better investments.
7. Biometric security is an enhanced feature that is a fast-emerging fintech development trend
Biometrics such as fingerprints or facial patterns provides much higher security than a simple alphabetical password. After all, nobody has an identical fingerprint!
Data privacy and information security are guaranteed if one uses these kinds of authentication techniques.
Organizations are promoting using these types of methods to prevent scams in day-to-day life and on a larger scale. Payment systems that will exclusively use these verification methods or their updated versions are marked for higher usage.
8. Internal regulation with the help of technology
For a company to function correctly, its internal working environment must be stable enough. Each department must be looked after, and the issues faced by them must be taken notice of.
Regulatory technologies have been developed to take care of these issues, and all the big players in the finance industry are using them.
The utilized technology then keeps the organization in the loop with the changing government schemes, financial moves within the sector and maintains harmony within the institution itself. Providing solutions for data management problems, tax management issues, and keeping track of changing laws can be achieved with “RegTech”.
9. Robotic software to handle repetitive tasks
Robots are becoming quite common in various sectors, and the finance field is no different.
Robotic software is helping organizations get rid of the monotony that sets in due to repetitive tasks. Besides reducing the workload, using Robotic Process Automation (RPA) will help eliminate human error.
Efficiency can be achieved, and transactions can be tallied to the very last decimal. The software can also easily maintain massive payment records and perform a large number of calculations within a few seconds.
Though this may seem like a futuristic approach, robotic software programs should be researched further for progress.
10. Payroll will be made easier with Fintech development in 2021
An institution is a mere reflection of its employees’ integrity and determination.
Workers are tied to a specific pay allotted to them by the management, and fintech can effectively handle the same. This brings about structure to the organization, and the process can be effortlessly drafted.
Any mistakes in the on-demand salary, advance salary, or crypto salary processes can be easily pinpointed due to the well-organized steps.
11. Governments are predicting favorable rulings for the finance sector
While most of the laws that will be passed in the upcoming fiscal year will be taking into consideration customer privacy, some form of freedom will be allotted to the financial institutions as well.
Regulatory processes might get stricter than usual, but the governmental agencies might help foster technological advancements in the finance sector and urge growth within the field to boost the nation’s economy.
All the above-mentioned fintech development trends will supposedly see the light of the day in 2021.
Considering the changes that have occurred due to the pandemic, one should plan their finances accordingly. These fintech development trends are also more useful for big financial institutions or companies looking forward to significant investments. They might prove to be the ultimate game changers!
Studying any given trend in depth will only lead to a well-informed decision on behalf of either the individual or the institution. Survival is crucial without upgrading business operating trends, so let’s get on to it.
Disclaimer. The views and opinions expressed here are those of the authors. They do not purport to reflect the opinions or views of IdeasPlusBusiness.com.
Any content provided by our bloggers or authors is of their opinion and is not intended to malign any organization, company, individual, or anyone or anything.
For questions and inquiries on the blog, please send an email to the Editor at ideasplusbusiness[at]gmail[dot]com. You can also follow IdeasPlusBusiness.com on Twitter here and like our page on Facebook here.
This website contains affiliate links to some products and services. We may receive a commission for purchases made through these links at no extra cost to you.
I am Marketing Manager at Digitalize Trends. My role is to research & ideate on trending topics & need to write the niche content as per industry norms. To help & provide relevant information to the community on trending technologies.