Finance and tech, commonly known as FinTech in the modern business world, are constantly evolving and changing under the influence of local and global consumer, economic, and market trends. One of the biggest movers in 2020 is, of course, the global Coronavirus pandemic that has impacted the commercial and residential sectors in numerous ways. However, the COVID-19 pandemic will pass, and companies will still need to prepare for the industry trends that will shape the post-pandemic world.
Technological advancements ease the process of running a successful business and are the driving force behind innovation in this field, and forward-looking leaders will have to champion the integration of new technologies in order to improve operational efficiency and build their competitive advantage. With that in mind, let’s take a look at the five important trends that will shape the FinTech industry in 2020 and the years to come.
Artificial intelligence and big data analysis
In today’s data-driven business world, big data analysis is one of the core processes that allows FinTech businesses to capitalize on industry trends, make accurate forecasts and predictions, sense the demand for certain products and services, and improve their competitiveness through strategic innovation. That said, it’s important to note that big data analysis has become a grueling task that wastes time, money, and human resources if done manually. In fact, there is so much data flowing around nowadays that collating it all into comprehensive reports manually becomes an impossible task.
This is why the FinTech sector needs to adopt artificial intelligence and machine learning and integrate it into big data analytics in order to collect and organize vast amounts of industry data quickly and effectively. The result will be a more sustainable data analysis model that will facilitate financial savings, streamline workflow and reduce risk, and most importantly, help a FinTech business thrive on actionable information and insights.
Integrating payment innovations around the world
Not a couple of decades ago, there were two main methods of conducting payments: cash, or by writing a check. Nowadays, though, it seems that we have numerous payment choices and options at our disposal, most of which are easy to use and have the features necessary to render cash and paper checks completely unnecessary in our everyday lives. Needless to say, innovation in the payment sector has greatly reshaped the way we look at global finance, and it will definitely continue to drive change in the FinTech industry.
Whether you are leading the innovation process and are pushing new payment methods into the global market or if you are involved in another niche of the FinTech industry, you have to scale and optimize your processes to accommodate the needs of a new demographic. Now that people are enjoying the benefits of contactless payment cards, direct debit systems, NFC technology, digital transactions and payment platforms, QR codes, and other solutions, it’s imperative for all companies to start integrating these technologies and allow new payment methods and digital currencies in their establishments.
The popularization of cryptocurrencies
One of the major trends that will disrupt the FinTech industry in 2020 and in the years to come is the implementation of blockchain technology and the rapid popularization of cryptocurrencies around the world. Companies across the globe have to start accepting cryptocurrencies as legitimate payment methods if they want to capitalize on a rising demographic, which will prove particularly lucrative in the post-COVID-19 world where cryptos will retain their stability against other traditional currencies.
This will spark the popularity of professional and recreational cryptocurrency mining around the world as well, as aspiring entrepreneurs and tech-savvy individuals looking to establish financial independence will have an incentive to obtain and start trading in popular cryptocurrencies. We can expect this uptick to happen amidst a global lockdown and as people in quarantine continue to search for new ways to make money working from home.
Regulatory technology is making finance safer
As technology continues to push the finance sector forward and expand it onto the international scale, it’s important to institute regulatory bodies, policies, and processes that will safeguard the finance sector and all relevant parties – from the companies that are looking to grow to their loyal consumers. Regulatory finance, or RegTech, as it’s popularly known in the financial circles aims to achieve this and much more by implementing monitoring solutions, regulatory bodies and policies, and ensuring compliance on a local, national, and even international level. With the growth of RegTech in the years to come, we can expect the online finance market to become a safer space for all.
Improving FinTech cybersecurity and stability
Speaking of creating a safer financial environment for all participants, it’s also important to note how the FinTech industry is tackling the increasing risks in the digital realm, particularly the risks pertaining to cybersecurity and the handling of sensitive consumer information. As cloud technology becomes more versatile and resilient to external threats, we can expect the FinTech sector to become safer in the years to come, while the integration of AI and machine learning greatly improves preemptive security measures and helps create an air-tight cybersecurity structure for a FinTech company.
The FinTech industry is always evolving and changing with the industry trends, and now is the time to start adopting technological solutions in order to stay afloat amidst a global crisis. Use these tips to ensure a successful future in 2020 and the years to come.
Mike Johnston is an avid blogging enthusiast and experienced content writer with a focus in business, technology, entrepreneurship, and real estate.