Financial technologies, or the no less stylish and popular word “fintech”, have long puzzled the minds of people who care about innovation. However, fintech experienced a special excitement (hype) only in the last two years, along with the cryptocurrency boom. Today, fintech attracts both software developers and financial market players who are ready to implement innovative solutions. You can become one of them and implement SAP banking solutions into your business. LeverX has experience in providing such services and can become a real helper for your business.
So what is fintech? In its broadest sense, it is exactly what it sounds like: technology used in the financial services industry, used primarily by financial institutions. However, more and more fintech is presenting solutions that fundamentally change traditional financial services, including mobile payments, money transfers, loans, and asset management.
Fintech in the world is developing very quickly and unpredictably. Technological breakthroughs sometimes occur where no one expected, radically changing the landscape of financial services. That is why this industry is quite difficult to forecast, not to mention the formation of any guaranteed predictions for several years. However, it is already possible to single out certain trends in the development of the industry.
Widespread Use of Smartphones
Mobile phones have completely changed our lives. However, their functionality has not yet been fully disclosed. The examples of the largest Chinese companies show that the smartphone can be a single center that connects all the consumer’s finances and life needs. The full implementation of such technologies as Mobile ID in the future will make it possible to completely abandon any other documentary identification of a person, except for the data of his smartphone.
Strengthening the Role of Social Networks
In 2015, Facebook launched a micropayment service using Facebook Messenger. Users of the social network can connect their card accounts and transfer small amounts to their network contacts. This emphasizes the seriousness of the role that social networks play in our lives. In the future, this role will increase, including in the field of financial services. Some banks are already introducing the practice of studying the client’s profile on the social network in order to set credit limits. After a certain time, the account on the social network can already be a full-fledged database about a person.
Crypto Assets
At this time, it is difficult to predict exactly what place cryptocurrencies and other types of crypto-assets will eventually occupy in our society. However, it is clear that the time has come to review the attitude of state authorities toward concepts such as “electronic money” and “private money”. Of course, national currencies play the first role in the world of finance today, but the cryptocurrency boom has demonstrated the desire of people to have alternative methods of payment in stock.
Artificial Intelligence
The use of chatbots in customer service, and purchasing goods through voice assistants on mobile phones or other devices, are already in use. The technology of artificial neural networks has not yet taken on the signs of full-fledged artificial intelligence, but such solutions reduce one of the largest costs for financial institutions – personnel costs. Thus, probably in the near future, they will occupy a dominant position in the structures of front offices.
Implementation of these trends is impossible without 3 important things:
- market demand;
- trust in technology;
- proper legal regulation.
The question of demand has already been resolved. People are not just ready but look forward to the implementation of these innovations. The fintech market is also gradually dealing with trust, providing technology for testing in so-called “sandboxes” or real markets with financial players.