With recession looming around the corner and funding drying up, investors and entrepreneurs are bracing themselves for the worst. In these unpredictable times, it is completely understandable if there is a lack of trust and opportunities in the business world.
However, we must keep in mind that establishing a business is a marathon and not a sprint. For long-term stability, it is crucial we look in the right direction regarding the industry to invest in. And the one that stands out is the Fintech industry. Although a lot has already been achieved, there is still a long way to go.
Fintech payment solutions and other services have changed the way people look at their finances now. According to Daniel Harman, Co-founder of Dark Square Capital, “people want more control over their finances“. With more inclusion and awareness, we are viewing a change in the risk averse approach of people. They are willing to take risks and are now demanding better services and transparency.
With the integration of advanced technologies, the banking sector is in a fine shape to fulfill every financial desire of people. In fact, we believe that offering Fintech app development services in specific niches like investing, trading, insurance, etc., will have the most to gain from these tech changes.
But what are the technologies that are shaping the future of Fintech? What is making Fintech the most lucrative industry to invest for long-term?
These are some questions that we will answer in this blog.
Artificial Intelligence to the Rescue
Artificial Intelligence is a word that gets thrown around a lot. And for good measure. If used properly, it can solve business problems with custom fintech software development and also offers solutions at such a level that it can disrupt an entire industry. We have witnessed this with the digitization of financial services.
· Better Utilization of Customer Data
Earlier, financial institutions were using AI in a scattered manner, focusing only on particular use cases. However, leaders in the banking sector are transforming their businesses by systematically integrating AI into every stage of their digital operations. Another fact that has made a difference is realizing that quality data is important to make efficient algorithms.
That has led organizations to utilize customer behavior data properly with financial software development to gain a competitive advantage. This has created a rather unique collaboration of financial services providers with non-financial players. That offers an unrealistically smooth customer experience that wouldn’t have been possible before.
· Better Data Analysis
With high-quality data, the result of data analysis will also improve the service of customer-facing applications. Personalized user experience, tailored products, and intelligent chatbots are just the tip of the ice-berg. There is much more that AI can do in the backend that will help you identify what is best for your customer.
Hyper Automation for Better Accuracy
Hyper automation is taking over a lot of tasks in almost every industry. Replacing manual labor with automation to perform repetitive tasks has reduced cost and time and improved accuracy. The Fintech industry is also witnessing the same trend. Rajat Agarwal, Chief Credit Officer at Cleo believes that the future of fintech will make financial services “affordable and accessible to the majority of people by leveraging technologies” and RPA has the ability to do that.
RPA, which comes under hyper automation along with AI, deep learning, etc., is already a key part of digital transformation. It makes it simple for businesses to utilize software robots like chatbots. However, companies are now expanding the scope of RPA in Fintech application development in the USA. They are now using RPA to assign the management of workflow data and business interactions to robots, automating and standardizing business execution.
· RPA + AI
High repeatability, clear logic, and solid stability make RPA an inseparable part of the Fintech ecosystem. Future RPA will integrate AI more thoroughly. It will enhance RPA’s ability to handle more complex business scenarios and streamlining the delivery of financial services. This will turn out to be revolutionary for not just Fintech, but for every industry.
· Automating Financial Processes
Most financial institutions are already using RPA to automate financial processes and accounting tasks with financial industry software development. Some other areas where RPA is being used are-
- Process automation for payables and receivables
- Fund appropriation at shared finance and accounting service centers
- Work hour adjustment and review
- Automation of financial recording, reporting, and treasury processes
- Period-end accounting and settlement
Automation boosts productivity while lowering human error and enabling companies to adjust to demand fluctuations. Although RPA is already well-established among major financial players, industry experts anticipate that it will spread more widely throughout the sector. For this, you can hire fintech software developers to integrate RPA and AI and boost productivity.
Cloud Computing Takes Care of Mountains of Data
With the increase in the use of fintech services, the data generated is also increasing at an exponential rate. It would have been a monumental task to keep track of this data and organise it properly if cloud computing wasn’t there.
Cloud has helped shape critical trends and will continue to do so in the future to drive Fintech growth with custom fintech app development.
· Data Aggregation
Organizations can store data like details about account balances, spending patterns, budgets, and cash flow securely on the cloud. That will enable every financial software development company to gather data from banking databases appropriately for processing. This data’s accessibility and confidentiality are both very beneficial to users as well as financial institutions.
Security is a top priority whenever any financial information is involved. Therefore, cloud computing’s strength and security allow fintech leaders to focus on their business knowing their data is secure. Unlike traditional IT systems that are vulnerable to cyberattacks, cloud computing offers excellent resistance with the help of its security architecture.
· Self Service Application
The ability of the user to manage a bank account easily with an app without any intervention from a third-party has given them a sense of control. With this control came the freedom to manage their finances where they can make transactions, access financial information, and build a budget on their own.
Cloud computing has enabled Fintech companies to build their own apps and not rely on IT infrastructure and data centres while making flexible storage and computing services more affordable. Fintech software developers are having a ball maintaining these applications with the help of cloud computing.
In addition, the cloud is giving rise to fresh formats like open banking and banking-as-a-service, upending the traditional partnership between clients and financial service providers.
What is Open Banking?
The concept of open banking talks about financial institutions publishing services and information through APIs. Customers will be able to access their personal information with the help of these APIs. Also, they will have the option to decide whether or not to give third-party companies access to the data.
What is Banking-as-a-Service?
BaaS is a comprehensive service that enables fintech firms and other third-party organizations to use APIs to connect with a bank’s system. This facilitates open banking services while assisting organizations in constructing new financial services on top of the regulated infrastructure of the provider bank.
Do You Want to Build a Future-Ready Fintech Solution?
Narola Infotech is a Fintech software development company with over 17 years of experience. Our Clutch rating of 4.9/5 is proof that our clients trust us and are satisfied with our delivery. If you want to work with a dedicated and expert group of people, feel free to contact us at any time.