2020 is unofficially considered a defining year for various reasons. Tons of estimations on the growth of industries and sectors across the globe have 2020 as the year, where things will go uphill. Fintech is no exception. Pull out any information or statistics on the growth of fintech, this year stands as the pinnacle of the industry’s growth.
These statistics can’t go wrong as fintech is expected to grow further with companies from around the world pouring in their investments in this sector. A report on these shares that investments in the fintech industry is expected to number over $30 billion in 2020.
With several fintech market players reinvesting in strengthening their service delivery and IT infrastructure, they are involuntarily setting up new trends in the market. They are all becoming increasingly customer-centric, aiming to get more things done in less time with the help of disruptive technologies.
Here, we break downtrends in the fintech industry to look out for in 2020.
Big Data and Artificial Intelligence for Personalization
Speaking of disruptive technologies, we cannot overlook the impact concepts like Big Data, artificial intelligence, machine learning, and deep learning have left on various industries. If an online streaming platform knows more about our movie preferences than our best friend, it is only because of complex artificial intelligence algorithms at work.
With the advent of Big Data, it has also become easier for companies to handle massive amounts of data generation and processing. Now, fintech companies can understand more about us through our online behaviour, browsing history and app usage on our likes and dislikes, preferences, credit and repayment history and more.
With AI being omnipresent across multiple channels, fintech companies are looking to combine the power of both to deliver better services and experiences to their users through personalization. If you’ve been into marketing, you would know the impact personalization has among consumers. With the combination of these two technologies, we can experience a one-to-one, focused banking experience in the coming months.
Blockchain To Shake Up the Industry
Financial institutions have always been eyeing optimum security and safety and with the onset of Blockchain, they are a step closer to achieving this. A decentralized and distributed concept that is fool-proof, Blockchain is everything the fintech industry could ask for. Some of the plaguing concerns in the fintech industry include frauds and identity thefts, which cause billions of dollars of losses to companies every year. With the implementation of Blockchain in this industry, companies can pave the way for a smarter and safer transaction and operation.
Besides, it is also revealed that the investments in blockchain are anticipated to hit $6,700mn by the year 2023. So, in the coming years, we could expect jargons of today like smart contracts, trading shares, identity management and more to become mainstream.
Chatbots are AI-powered bots that replicate human interactions. They have access to the internet and are designed to accurately pull out specific information depending on the question asked. Most of us are already talking to a chatbot in a number of scenarios and we aren’t aware of it. Close to cracking the Turing Test, the implementation of chatbots will continue to soar to new heights in the coming months.
By the year 2023, it is also expected that close to 826 million hours would be saved by banks with their chatbots deployment. Also, over 79% of the successful interactions using chatbots will be through mobile applications in the coming three years.
With the fintech industry being prone to queries and questions from potential leads, new customers, existing customers and others, chatbots are the way forward to save time on redundant tasks and use manpower to focus on niche tasks.
RPA stands for Robotic Process Automation. In the year 2020, more companies will invest in deploying RPAs into their systems to optimize operations and make service delivery more effective. An advanced version of chatbots, RPA is more like an artificially intelligent colleague working with you at your workplace.
They were one of the biggest trends to watch out for in the year 2018 and in a span of two years, they have become mainstream enough to be deployed in companies. With their implementation, companies can further make their data aggregation and processing more streamlined, offer better customer service, find and fix loopholes in workflow and take care of specific tasks like:
- Onboarding customers
- Verifying and conducting background checks
- Data analytics and reporting
- Managing compliance processes
- Assessing risk and more
With digital implementation comes enormous risks. That’s a giveaway. When companies, especially fintech companies, go digital in terms of applications and progressive websites, they open up new avenues for attacks and threats. According to research, over 98% of the top 100 fintech companies across the globe have vulnerabilities despite having proper tech infrastructure in place.
There are also issues of identity theft, fraudulent transactions, access to sensitive user data and more in this sector. That’s why cybersecurity stands as one of the priority implementations for the year 2020. Blockchain, AI and other technologies we discussed earlier are all simultaneously working on optimizing security in this sector.
So, these are the top fintech trends to look out for in the year 2020. If you intend to get a fintech app launched, you need to take care of all the factors we just discussed. They are trends because they are inevitable this year.