The world of banking and financial services has changed drastically over the past few years. The rise of technological innovation in banking and fintech sector has changed the way banking software companies have been operating. There has been a rush of cryptocurrencies powered by Blockchain, along with the AI automation that has disrupted the banking and financial space for better.
It is not tough to say that we have entered into a new era of high-end banking services with improved security, safety, and trust in online transactions, greater than ever before. There are over 94% of consumers, who want to complete transactions online. This has just ensured the reformed trust in banking software companies for financial product development for feature-rich banking applications.
This blog will encompass the futuristic trends in Banking and Financial Services for the year 2020.
Let’s have a look:
1. FinTech will drive the new business model
For a long time now, new market entrants are finding it difficult to break into the financial services industry.
But not anymore, financial disruptors have been finding ways to enter into the FinTech space via start-ups, focused on a particular innovative technology or process in everything from mobile payments to insurance.
The global fintech market was valued at about $127.66 billion in 2018 and is expected to grow to $309.98 billion at an annual growth rate of 24.8% through 2022.
FinTech will be really making an impact in the forthcoming year 2020, through these highly targeted numbers.
2. Digital becomes Mainstream
There was a time when many financial institutions built e-business units to extract a large amount of e-commerce interest. Soon, the interest becomes the new normal. Internet development and large technology investments drove unprecedented advances in inefficiency.
In financial services, you can see this approach being applied to payments, retail banking, insurance, and wealth management, and hence migrating toward institutional areas such as capital markets and commercial banking.
3. Neobanks will branch out to emerging markets
The rapid expansion of Neobanks across Europe has recently revolutionized the traditional banking infrastructure and has disrupted the whole financial landscape. A recent study from AT Kearney has found out that by 2023, these banks could have up to 85 million customers, 20% of the European population over the age of 14.
In 2020, you will expect to see the global expansion of several major Neobanks in emerging markets, as customers all over the world move to a digital-first way of life and the same they want to reflect in the way they bank.
It will be accompanied by the growth of digital identity verification technologies that keep customers and banks secure. Without this, the Neobanks won’t be able to comply with any stringent new regulations that you expect to see, and customers won’t trust the challengers.
4. Most of the banks will make strong customer authentication a reality
In 2020, failure will no longer be an option, hence you will see 100% of banks, financial services providers, banking software companies, retailers, online marketplaces, and payments companies gearing up their strategy to ensure that SCA( Strong Customer Authentication) becomes a reality.
Banking and financial service provider companies need to step up their game as now they have to secure the future of payments and transactions online. Banking software companies need to ensure that the right investments are made in technologies that will ensure security, whilst enabling regulatory compliance, and keeping a laser focus on the needs of digital-first customers. Balancing these conforming needs will be what it takes to thrive in the 2020s.
Do you know about the importance of your customer’s value? Are you sure? Customer’s Intelligence majorly focuses on surveys, these are real individualized data about consumer behavior.
Advancement in technology has given businesses access to exponentially more data about what users do and want. It is an amazing opportunity for businesses who can use analytics to unlock the information inside, to give customers what they really want.
5. Customer Intelligence
Do you know about the importance of your customer’s value? Are you sure? Customer’s Intelligence majorly focuses on surveys, these are real individualized data about consumer behavior.
Advancement in technology has given businesses access to exponentially more data about what users do and want. It is an amazing opportunity for businesses who can use analytics to unlock the information inside, to give customers what they really want.
6. Personalized Banking
Traditional banking has been revamping its modular infrastructure and hence moving the rampage towards mobile-only online services. It’s time for banking and financial services to invest in new and exciting ways for people to bank digitally.
You are likely to see many banking software companies that are going to invest in new technologies to flourish and dominate personalized banking services.
In 2020, personalized digital banking will hit the mainstream. Advance Chatbots and WhatApp enabled services will respond to more complex queries and send push notifications to remind you to pay bills.
7. Amplified Reachability
Banking and Financial Services have been focusing on increasing the utilization of open development and Software-as-a-Service (SaaS) solutions being offered by banking software companies for financial product development.
It is easier to integrate and streamline operational capabilities in the banking system and process toward mobile delivery advantage.
8. IoT in Banking and Financial Services
The market size of IoT in the financial and banking industries is expected to reach over 2 billion USD by 2023. Without a doubt, IoT can propel the financial industry to the next level.
Interactive IoT devices such as wearables have become a pioneer in providing banking and financial services.
For instance: After a user has set a credit card limit, a wearable will track their spending throughout the day. As you approach the limit, you’ll be alerted. In case a user ignores a notification, a wearable will send a shockwave to their wrist as a reminder to not spend any more.
IoT offers a range of opportunities for banking and financial service providers, be it in the form of customer management, business process automation, new forms of payments, and much more.
9. Smart Solutions
Today, it is all about providing smart solutions to customers. The ever-growing need and no time clause for customers have pushed the banking and financial service providers to look for solutions that are quick, abrupt, robust and flexible overall.
Banking and finance industries have been looking forward to FinTech Solutions to develop defined and highly effective solutions for banks that have managed to step into and take over those lines of segments that had been neglected by banks in terms of service offerings.
In the end
The FinTech landscape is continuously evolving with each passing year. However, the foresight trends in banking and financial services is not the ultimate checklist that FinTech and banking software companies should follow in developing the futuristic landscape for financial rich feature products.