During the pandemic, mobile app usage increased by 39 percent in the United States and as much as 72% in Europe, according to a recent study by Finextra. Users around the world became accustomed to fintech and ecommerce and researchers expect momentum to continue into 2022, largely driven by financial technology advancements.
Recognizing that digital finance is here to stay, fintech businesses have upgraded their services to provide a better user experience. Following are emerging trends to watch in the fintech sphere:
Many industries are now integrating artificial intelligence (AI) into their systems, including fintech businesses. In fact, CNBC reports that finance-related job listings requiring skills in machine learning engineering have increased by about 60% in the past year. Financial institutions are on the lookout for AI professionals who can improve user-centered experiences, develop predictive models, and enhance services via machine learning platforms. With the help of these skilled professionals, fintech businesses have expanded their services by maximizing AI capabilities. To illustrate, AI solutions can improve customer support services by speeding up query resolutions and providing automated answers for user concerns. AI can also be leveraged to create automated financial services that offer great value for a low cost, such as trading bots. These are just some of the benefits that stem from utilizing AI technology.
Thanks to AI and API systems, it is easier for fintech apps and banking services to be connected through open banking. This particular technology allows users to manage their finances across different digital platforms. To accomplish this, banks need to follow PSD2 (Second Payment Services Directive) regulations and release information securely. Following the promulgation of this technology, today’s finance professionals now pursue accounting degrees with a concentration in accounting information systems. After all, knowledge in digital accounting technologies is crucial for these professionals to manage financial information and provide banking services through digital platforms. Through open banking programs backed by competent professionals, consumers can aggregate their accounts and manage their finances more conveniently.
Insurtech is another fintech trend that also benefits from technologies like AI and data analysis. It’s a new technology that is already taking off all over the world as our article on the Hong Kong fintech week highlights the emergence of insurtech services. Hong Kong already had four virtual insurance services late last year, and other countries are also building their own insurtech startups. This new fintech trend is indeed taking the world by storm by providing personalized and affordable insurance services through technology. Insurtech services use deep learning AI to create the right insurance policies that suit an individual’s needs. And because the process is handled by AI instead of traditional insurance brokers, premiums can be offered at a more affordable rate.
While digital platforms can provide plenty of convenience, users are worried given the increasing risk of cyber threats. Thus, fintech companies are investing in different cybersecurity measures to protect their users’ financial information on digital apps. For example, a number of fintech apps are implementing biometric authentication as unique identifiers are hard to replicate. Instead of typing in personal identification numbers, fintech users can now verify online transactions quickly and securely through fingerprint or facial recognition scans. More importantly, users prefer this convenient security measure as opposed to passwords as the latter can in some instances be hacked. Conversely, users can easily and safely access fintech services through biometric scans.
Consumers around the globe are already utilizing fintech services. But with emerging fintech trends, they are becoming more accessible, personalized, and secure. With the sheer amount of progress and increased use, there’s no doubt that the fintech industry is here to stay. And it’s partly thanks to these innovative technologies.
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Tara Cole is an avid blogger who is currently juggling single motherhood and freelance work. As a professional in the tech space, Tara is now working on her own book about technological trends and how they affect the people around them.