Digital transformation in the finance industry was merely a movie concept if you reversed back a few years ago. But technology has taken it so far that now it has become an imperative business strategy due to cutthroat competition. Even customers are gravitating towards the financial companies leveraging digital transformation. Our interaction with money has undergone a marked change over the years.
Businesses in the finance industry are leveraging technology to work faster, accurately, cost-effectively, and offer better customer service. These benefits can constructively help businesses to stand out from the competition and leave a distinguishing mark. The work of finance officials requires extreme concentration as they all deal in monetary matters. On the flip side, digital transformation in the finance industry has trimmed down manual and human errors, which has reduced the risk of massive fuss in financial services.
Put on your knowledge specs, and let’s see the technology trends bringing major break-through in the finance industry.
1. Financial Technology (FinTech)
Financial technology (Fintech) can be described as banks and financial companies leveraging modern technology to deliver improved financial services. The evolution of Fintech has started from credit cards & banks and reached blockchain & digital banks while still unfolding more for the future. The emergence of Fintech has offered a more secure and diverse financial services landscape. India is adopting Fintech at the rate of 87%, while the global average adoption rate is just 64%. Estimations state that the Fintech software market in India can reach $2.4 billion by 2020. Such a high revenue growth is enough to describe the rate of adoption and incorporation of FinTech in the finance industry.
2. Artificial Intelligence in Finance
Earlier were the days, when cybercrimes were dreadful and identifying them was an even bigger nightmare. But artificial intelligence & machine learning have stirred up the situation by using complex prediction patterns to detect theft and fraudulent activities. Customer behavior, compliance management system, and investments have seen a major transformation over the evolution of artificial intelligence in finance. Earlier, people were scared to use their cards anywhere, but now, the use of complex algorithms by financial service providers to identify fraudulent activities has pushed away that fear. A recent research study estimated that almost 77% of consumers prefer using cards for payment, while only 12% tend to choose cash payment over card payment.
3. Digital Banking
Modern customers don’t look for a splendid building, but they want 24/7, easy-to-access service and humanized contact. Do you still prefer to go to the bank to transfer money? Of course not! Instead, digital banking has enabled us to transact and inquire from anywhere. Electronic payment systems, such as RTGS, ECS, NEFT, debit cards, credit cards, etc., have transformed the way of interaction with banks and money. Checking account history, previous transactions, requesting passbook, bank statements, and several other banking-related tasks are now as easy as pie.
4. Digital Payments
The digital payment system was present for a very long time, but its use significantly picked pace after demonetization in India. Counterfeit currencies, paying with the change, taped currency were some of the common issues to deal with daily. Digital payments have changed this entire scenario and made payments easier. The introduction of Bharat Interface for Money (BHIM) and United Payments Interface (UPI) are deemed as crucial milestones for the banking and payment system for the entire country. In 2019, digital payments were valued at $65 billion and expected to surge at a CAGR of around 20% over 2023. The popularity of digital payments among people is increasing, resulting in a more number of digital transactions over time.
5. Mobile Apps
Customers want such easy banking facilities that they don’t even want to access bank websites over and over again. They want everything at their fingertips in just a few taps. So, everything in the finance industry is going mobile. This has forged many third-party service providers in the finance industry to compete with the banks. Want to make a payment? Scan and pay. No matter what is the amount of payment, the process is as simple as that. The finance industry is already packed with several mobile apps and still in shape to undergo more innovation.
6. Digital Financial Documents
When payments are digital, then proof of payment is also going to be digital. Banks and financial service providers have started sending monthly statements or payment receipt on emails. These documents are mostly in PDF format. The need for saving these documents has branched out because, like physical documents, you cannot save them in any tangible file. The solution is cloud space storage for digital documents. The day is not far when the finance industry is going to be completely paperless.
If you are looking for the safest cloud space to store your company’s documents, then you can give FinCRM a try. This CRM software is your all-rounder sales partner and office organizer. You get the most secure document manager in it; wherein, you can store your entire important documents without worrying about their privacy. And when we say complete privacy, we mean it. You also get a financial module to record all your payments, invoices, and quotations without ever losing them. This CRM software is going to be a worthwhile investment. You can enjoy a free trial here and then decide.
These aforementioned technologies are driving the finance industry in new directions and creating an innovative landscape. Everyone in the finance industry runs to catch up on these technologies and offer better customer service than ever. One thing is for certain. These technologies in the finance industry are going to stay, grow, and branch. This technological explosion is going to change our patterns of dealing with financial matters, and the effect of this explosion is never going to slow down.
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