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The fintech landscape will witness a plethora of innovations to ensure holistic financial services over a mobile interface. These days, all industry sectors and banks are facing a lot of challenges. Norms like social distancing and a dynamic regulatory environment have made banking activities highly challenging. Enterprises across different industry sectors and individuals find it tougher than ever to get banking facilities in traditional ways. Here, FinTech can make a difference!
From mobile banking to investing services, and cryptocurrencies to digital wallets, fintech technology has taken modern businesses by storm globally. On one hand, this evolving technology has enhanced the convenience of people, and on the other hand, it has made online transactions more secure and quicker than ever. Let’s go through the scope of the fintech sector in the coming years across various industry sectors.
But, before understanding the scope and benefits of a thriving fintech sector, how about having to look at some interesting statistics?
FinTech is a combination of two words “financial” and “technology” and it was coined to explain the role of IT enterprises in the BFSI sector. A plethora of technology enterprises focuses on dealing with issues related to customer services, data management, regulations, and governance. In this pandemic age when people prefer to purchase and transact online, all the industry sectors eye on the fintech innovations.
The rise of the fintech sector has opened the doors of new opportunities and possibilities for businesses worldwide. It is possible to offer more services in a secure and quick way as the fintech sector transforms the traditional ways of transferring money.
At the enterprise level, it can bring a radical shift in the ways of accomplishing projects. Let’s understand the impact of fintech across various industry sectors.
Gone are the days when the scope of the fintech sector was limited to the BFSI industry. Fintech has a lot of potential to transform key processes of various industries. Innovative fintech concepts can change the customer’s experience and expectations by offering a more interactive approach. It also challenges the conventional ways of the value chain, market positioning, and business models.
Apart from banking and financial services, advancements in the fintech sector can offer entrepreneurs opportunities for value creation. It makes it possible for corporate users to understand the client’s needs to provide them with personalized products and services. The fintech sector offers analytical tools to collect and integrate structured and unstructured data.
Innovation in the fintech sector can enhance access to liquidity and the BFSI sector can assist other industry sectors with more efficiency. Banks and other financial institutions need to embrace new technologies and remain updated with the advancements. Many banks are reconsidering their strategy to interact with industries with the help of a fintech sector.
“Fin-Tech and banks need a cultural reconciliation: risk appetite and tolerate trial and errors” – Hugues Delcourt, Former CEO, Banque Internationale
The rise of the fintech concept also assists enterprises to meet compliance and regulatory requirements. Development in fintech can simplify complexities and enhance transparency while offering higher data protection.
Industries can provide a personalized experience and make auditing easy. Finally, a lack of people’s trust in the traditional banking sector and more focus on products or services are some of the major reasons for the rise of the fintech sector.
Various industry sectors, irrespective of business model and sizes, can leverage the benefits of fintech in multiple ways. Following are some of the key benefits of fintech or financial technology.
Fintech facilitates enterprises to optimize efficiency and boost productivity in favor of their customers. It translated into improved customer support. What’s more, they can get secured and speedy transactions every time. Companies can get high customer retention rates and grow with more profits.
Apart from providing swift and advanced monetary services, fintech can assist companies to ensure the safety of confidential information of customers. With the help of Blockchain and AI technologies, fintech firms can offer robust solutions to enterprises for detecting frauds and securing the customers’ financial details. Data encryption, tokenization, and other security-related features can boost the customer’s confidence.
One of the important benefits of fintech for companies is mobile connectivity. It can increase the number of individuals who access various services significantly. With more convenience of transactions and increased adaptiveness, enterprises can remain ready for competition and challenges.
It is easy for companies to streamline their services and processes while keeping their customers in focus. As a result, they can get a wider customer base.
“By lowering the barrier to create new digital currency applications, we will see an explosion in the number of ideas tried.” – Brian Armstrong, a US-based CEO and Investor
It is an interesting benefit of the Fintech concept. Businesses can issue invoices more effectively and collect payments more conveniently through fintech solutions.
Fintech can bring more accuracy and enterprises can provide more professional services with advanced payment systems. It can improve customer relations thereby increasing the probability of them returning as regular customers.
Fintech technology is useful for meeting all compliance and credit score-related requirements effectively. Modern businesses can get access to a variety of funding options thanks to audit and compliance. SMEs can maintain liquidity by having access to funds and trade finance.
Fintech companies also come up with customized P2P (Peer-to-Peer) lending, merchant finance, online supply chain finance, and other solutions to empower modern businesses.
The fintech sector has rightly proven a boon for modern enterprises. It assists entrepreneurs to drive changes in traditional business models and foster innovations. In a nutshell, the fintech sector can make enterprises ready for the future. It makes the management of the transitional economy easy while executing an advanced business strategy for enterprises.
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