2020 Fintech Trends: Analyzing Disruption by Department
The new decade is here, figuratively, if not literally, and with it come many changes for the fintech ecosystem.
As we plan out our annual pipeline, let’s take a look at the main fintech trends for 2020 and their possible impacts by department.
Operations: Robotic process automation (RPA)
You might be familiar with Robotic Process Automation (RPA), a type of technology that allows for a robot or software to perform processes on behalf of a human. These functions can include data handling and triggering responses. Today, RPA software can even observe and learn from human behavior, thus programming itself to automate specific tasks.
Although RPA has been around for a while, its relevance will continue to grow within financial institutions when it comes to customer onboarding, data analysis, increasing efficiency, and overseeing compliance checks.
We will also see a surge in hyperautomation, which considers the different needs for streamlining processes. Founded on RPA, hyperautomation integrates machine learning, artificial intelligence (AI), and other tools to increase output and enable cross-departmental collaboration.
For the fintech industry, a landscape ruled by its cross-disciplinary nature, the continued use of RPA and its mega evolution will prove indispensable.
IT: Blockchain and 5G
The deployment of 5G has begun, and its proliferation is bound to skyrocket in 2020. With it will come the awakening of the Internet of Things (IoT), pushing voice search and smart objects to the forefront. It’s hard to determine which gadgets will catch on first, but even the most commonplace of objects have the potential to become gateways to financial services.
Blockchain, the industry’s primary disruptor, will continue to slide into financial institutions through much more than just digital payments. While on the road to scalability, blockchain will fast-track contracts and customer identification. More importantly, as blockchain grows, so will alliances between established financial institutions and new players, bringing more choices to customers.
Customer service: Chatbots
Thanks to chatbots, support is available 24/7. In 2016, Gartner predicted that the average person would have more conversations with bots than with their spouses. Standing at the finish line, it’s evident that chatbots are everywhere.
For the finance industry, customer service is vital. Handling money is delicate, and any mishaps need to be corrected with the utmost brevity. Virtual assistants, voice and otherwise, capable of solving issues on demand will ensure the sustainability of finance companies as markets grow and transaction volumes increase.
Marketing: hyper-personalization and AI
Over the years, we’ve seen a shift in advertising from general to targeted, but personal ads are becoming the new normal thanks to Big Data. By gathering social and browsing histories from different sources, marketers are now able to hyper-personalize their messages.
For the fintech industry and beyond, this means developing a deeper relationship with customers, which will help fintech companies foster trust with new customers more quickly.
Cybersecurity and compliance: traceability and regulation
As great as technology is for marketers and businesses in general, customers are growing weary of the amount of data being collected. Companies and organizations also understand the responsibility they are taking on by amassing customer information. This year, the focus will be placed on establishing AI governance, with governments following suit of the European Union’s General Data Protection Regulation (GDPR) law.
From a compliance and cybersecurity standpoint, AI is still a hero. Thanks to this technology, businesses will be able to automate regulation checks and increase cyber-attack protection by running processes capable of recognizing patterns and taking action.
In short, the rapid evolution of financial products and services is not the only scheduled disruption for 2020. Fintech companies themselves will find technology morphing before their eyes and with it the way we think about money transfers, payments, and other financial transactions.