
Fintech continues to make our lives easier and more secure with new and more impressive advances each year. I have noted a few trends for 2019 that seem to be making headway. Among them are increased applications of blockchain in conventional industries, a rise in digital assistants, consolidation of start-ups and faster payment processing. Three quarters into the year, we have witnessed these trends come to fruition. Blockchain is now used in real estate (including our very own Ducatus Property) and law with smart contracts. Some start-ups went into consolidation (e.g drone start-ups) to avoid closing. Paying for items was made faster by “tap and pay” systems. Also, digital (or virtual assistants) have increased in number and have become a fixture in homes (e.g. Alexa) and on smartphones. The new fintech trends have a great deal to live up to. Let’s take a look at the four top fintech trend forecasts for 2020.
- More regtech solutions. Regtech is a combination of regulatory processes and technology. Financial institutions will implement technological solutions instead of hiring employees to handle compliance tasks. According to BBVA, investment in regtech within the financial services industry will increase 500% by 2020.
- Fintechs and financial institutions will focus more on millennials. In the United States alone, millennials have taken the top spot as the largest demographic. Through automated services that help them purchase homes, pay student debt through their employers and start their own businesses, financial institutions and fintech start-ups are investing in their technology to cater to this demographic’s needs.
- Paychecks are unbundling. Unbundling is when a product or service is taken apart so the consumer can pick and choose what part he or she wants from it. Payroll is the latest service to be unbundled. Fintech start-ups are offering customers flexible banking services, such as pay advances, early direct deposit and financial advice with paychecks. For example, Chime and Varo customers can get their paychecks up to two days before the scheduled pay date.
- More artificial intelligence (AI) applications in banking. AI is reshaping the banking industry through automation and machine learning. Virtual assistants, mobile banking, chatbots, and fraud detection are some of the services that AI will enhance. This means 24/7 banking and quick interactions for customers. These applications will be used the front, middle and back offices of banks affecting everything from greeting customers to underwriting loans.
The financial services industry will become even more versatile and accessible in the coming year primarily due to fintech startups. It’s amazing how technologically advanced banking has become, even in the past ten years. Fintech has created a new way of banking that saves time and money. Truly, those of us in this industry are looking forward to bringing more innovation to even more people in the years to come.
Originally published at ronnytome.com on September 19, 2019.