Your Money: Tech trends that will shape fintech sector in 2021
January 13, 2021 1:45 AM
Fintech has made banking easier as people can now perform all their banking-related tasks remotely from any device that has an internet connection.
The year 2021 promises to be “the year of the value chain” for the fintech sector.
By Rachit Chawla
The fintech sector is a combination of finance and technology. Since technology keeps evolving at an exponential rate, the fintech sector follows close behind. So far, the claims of technological disruption have been centered on changes at the customer interaction level, i.e., digital account applications, digital user interface, etc. The year 2021 promises to be “the year of the value chain” for the fintech sector.
Let us take a look at some of the trends that will shape the fintech sector in 2021.
Robotic Process Automation (RPA) The RPA is a process that utilises robots and advanced technology to perform the tasks which were otherwise carried out by humans. In 2021, we will witness more organisations adopting RPA to handle different backend tasks like security checks, customer on-boarding, account maintenance & closing, trial balancing, credit card and mortgage processing, among others. RPA allows fintech organisations to manage mundane yet necessary tasks efficiently, freeing up the human resources for other important tasks like customer service.
Blockchain Blockchain technology has brought a level of transparency in financial transactions that once was unimaginable. Transactions have become much more secure since blockchain technology came into the picture and this has allowed the customers to trust the fintech companies that have this technology in place. Blockchain technology will play a key role in transforming the banking sector in 2021.
AI and ML Artificial Intelligence (AI) and Machine Learning (ML) blitzkrieg is unstoppable. According to expert estimates, AI technology will reduce fintech organisations’ operational expenses by 22% by the year 2030.
AI can also play a huge role in getting cybercrime under control by identifying financial frauds and threats. It can also improve customer experience as it can easily record all the interactions between the customers and the organisation and call upon the stored data to offer just the right deals to individual customers.
Traditional banks have remained relatively rigid in their approach and have not molded themselves according to customers’ needs, can influence more people to migrate towards fintech organizations. Fintech companies will improve financial inclusion in the year 2021 by offering banking facilities to the weaker section of the society and by making banking efficient, fast, and convenient.
Biometric security systems Fintech has made banking easier as people can now perform all their banking-related tasks remotely from any device that has an internet connection. However, this has also created a wealth of opportunities for cybercriminals – who are always looking to exploit a weakness in the system.
This means that the fintech organisations will have to rely more on biometric security systems as they are reliable and foolproof. However, biometrics industry itself is at a transformative stage, and contactless biometric solutions are going to become popular soon.
Technological evolution is a never-ending process that makes our systems and our world a better, much easier place to live. These trends will shape the fintech industry in 2021 and will make it much more efficient, robust, and customer-friendly.