The Fintech industry has gained popularity throughout the past decade, accelerating the growth of many technological solutions, services, and applications. It’s clear that Fintech has already made a huge impact on many businesses by changing the way companies operate. When we hear the word “Fintech”, the first thing that comes to mind for some is electronic payments. Despite the popular term and the significant growth of Fintech, it has evolved into more complex inventions.
Naturally, the need to adapt to the digital scenery and the global pandemic was the consequence of a huge turning point in the Fintech sector. The finance and technology industry enabled contactless payments and online shopping for many enterprises that migrated to the online world. It’s no secret that Fintech is continuing to spread its successful technological solutions by bringing true value and convenience to customers.
But the real question is – will the success of Fintech last? Considering the ever-changing regulatory landscape and the stricter legal requirements, along with safety issues, Fintech, like many industries, has its challenges. In this article, we’ll review some of the most popular predictions for Fintech and its future.
Fintech Services Will Become More Affordable
Software-as-a-service (SaaS) isn’t just a buzzword anymore. Many modern businesses believe that SaaS is the new must-have technology that is vital for financial institutions that are thinking of launching their version of a Fintech business anytime soon. Thanks to more streamlined algorithms, businesses can move on from physical operations and complex paperwork. That’s why digital financial mechanisms and advances in artificial intelligence (AI) have helped the Fintech industry become more affordable and more accessible, even for smaller organizations.
The term “automation” in Fintech exists for a reason. The cost of automation won’t outweigh the benefits any time soon. Currently, specialists argue that administrative work costs more than implementing advanced automation solutions in the Fintech industry. Due to machines being able to do the work more efficiently, AI-powered service costs will most likely go down.
The Boom of No-Code in Application Development
Low-code platforms and no-code development platforms help users and programmers to design new apps easier. Instead of traditional computer programming, modern Fintech players will continue to power graphical user interfaces and drag-and-drop interfaces more. This is important because this way of programming can help the Fintech sector reduce costs for costly software development talents.
For instance, Google Cloud has already invested in one of the largest no-code software platforms, Unqork. The aim here is to help companies manage and build various apps without having to write a single line of code. If we take a look at the technicalities, such platforms combine software engineering, customizable workflow procedures, and fast development tools. Specialists note that this is a great technology for Fintech institutions looking for solutions to respond quickly to market shifts.
Cloud Computing isn’t Going Anywhere Soon
Unlike non-core businesses, financial institutions can gain more advantages from cloud computing. This technology helps Fintech companies access important files easier. To put it simply, cloud computing enables access to flexible storage solutions, at the same time, doesn’t require high costs. For this reason, cloud computing is an absolute must for banking-as-a-service and open banking services to enable a more swift and smooth relationship between customers and financial service providers.
Based on the success of this technology throughout recent years, Fintech companies will continue to use the cloud to add more flexibility and easiness to their agenda. The cloud provides agile capabilities, helping the company scale easier. In addition, big data analytics will eventually demand cloud-based elastic computing. This way, computing resources can adjust to meet the company’s shifts in demand.
On top of that, Fintech specialists predict that more banks will see the potential behind the cloud-based microservice architecture and adopt application programming interfaces (APIs). In this scenario, Fintech players will allow their services to scale independently, which means that they will no longer require to enlarge the coding base of the overall offering, which powers machine-to-machine communication.
AI and Deep Learning Will Replace Manual Work
Artificial intelligence (AI) powers Fintech players by improving many processes, such as work automation capabilities and decision-making. AI and deep learning enhance Process Automation, making it easy for Fintech businesses to deploy automated tools. For example, that’s exactly why chatbots are huge today. Being one of the components of digital transformation, AI continues to test technology’s limits.
At the moment, many Fintech companies use automation to improve efficiency and the effectiveness of different operations, including accounting reconciliation, financial reporting, and further financial service provision streamlining. Not only that, but automated procedures help Fintech businesses avoid human error and save operational costs. No wonder why the industry is run by AI and deep learning.
Future predictions show that AI apps will power the whole spectrum of Fintech. From personalized experiences to smart analytics solutions and robots, AI enhances various knowledge representation tools. A huge part of AI in Fintech is also used for digital security services. Facial recognition technology and AI-powered biometric scanning technology will be widely used for Identity Verification, which is part of the mandatory legal requirement for different financial institutions and Fintech companies.
The Final Words
There’s no doubt that technology is part of finance. It seems that the Fintech industry will continue to power financial systems through AI and machine learning. The potential will continue to grow. Fintech players will no longer need to spend hours on analyzing data and delivering results to financial institutions. With modern technology, we now have real-time decision making without having to spend huge amounts. And of course, the list goes on.