Emerging Financial Services Trends for 2021
Financial services industry has undergone a great deal of change in the last 10 years, and new technologies are driving these changes further. On top of that, the global pandemic has forced almost every industry, as well as societies to adapt quickly to new ways of living and to work. Financial services are no exception to this change.
Today most of the professionals employed by the financial services sector are working remotely and finding new ways to face challenges as they emerge. To innovate is no longer a desire but more of a need for this industry that touches everyone’s lives and whose operations cannot be brought to a standstill for even a single day.
Several financial technologies are coming to the rescue and leading the way to survive in this new state of things, and that is set to change the future of the financial services industry. To adapt to the new normal that has emerged out of this pandemic, these technologies have been a great help. Some of the ideas and tech that will rule the roost in 2021 are being discussed here.
Role of AI In Streamlining Financial Services
With the sudden onset of this pandemic, financial institutions across the world were sent into a tizzy, and it became quite challenging to carry out all the processes without people being able to step out of their homes. The need to fill the gap digitally became the need of the hour instead of being a long term goal. Efforts were initiated to enhance digital capabilities to perform critical operations, and AI was at the forefront of it all.
Whether it be customer communication related to loan lender notifications and alerts, or the ability to detect and minimize the possibility of fraud in these desperate times with minimal human intervention, AI-powered technologies and tools emerged as a ray of hope. AI tools are already becoming a big part of financial operations, but they received additional push with the ongoing situation.
AI offers high-computing abilities, performs financial analysis independently, and carries out complex tasks like organizing and providing financial products and services in keeping with the needs of the consumer. AI is also helping fulfil intelligence-driven digital banking needs and improve mobile banking experience at the same time.
There is bound to be a more significant push in 2021 on development and applications of AI-powered tools and technologies to not only make financial services more robust but also help find newer ways to manage risks in a fast-changing industry`.
Predictive Data Analytics Is Driving the Next Big Change
With the kind of datasets placed at the disposal of financial service providers, predictive analytics have become the rage. This is carried with the help of AI and employs complex algorithms to predict user behaviour, emerging patterns and better ways of dealing with challenges not seen before.
One of the most significant underlying advantages is the elimination of the old trial and error methods which is replaced with high-power simulation capabilities and emerging cognitive abilities of the next-gen tech-driven by these changes.
Products and services can not only be offered in an organized manner but reorganized a million times and even personalized by synchronizing user behaviour patterns and predicting change where needed. Optimal utilization of datasets has only begun to take place, and financial services need it more than ever before.
For instance, if someone is looking for a £3000 loan for bad credit, then predictive analytics can help predict whether it is recommended for the person and what options would be best suited for him/her. To manage a loan as well, personalized schedules can be worked out to ease the burden of repayment on the borrower.
Automation and Cloud Computing to Enhance Precision, Efficiency &Security
Studies reveal that Robotic Process Automation (RPA) can help finance-related services save 25-30% of costs on an average. This is achieved by tasks that are repetitive and data-intensive getting automated for the ease and efficiency it affords. Automation has been a big help in financial as well as other industries in improving process accuracy and increasing productivity across verticals.
Cloud computing is the obvious choice for financial service providers to go with when digital payment and financial tools are heavily used, and banking is also going digital at a fast pace. Today, you can open an account, carry out financial transactions, invest in stocks, apply for loans or pay salary to your employees digitally. This is what makes cloud computing the best option for storage of financial data to enhance instant access and accelerate processes without losing efficiency.
Mobility and on-demand availability of cloud resources is another great advantage that helps offer a seamless experience to the user. It also helps improve cybersecurity which is a big concern for the modern consumer and companies.
Emerging and existing financial technologies are setting new trends in the financial services sector. In 2021, a new beginning is bound to be made in a hopefully post-Covid era where AI, predictive analytics, automation, cloud computing and other technologies will drive the change. Development and adoption of financial technologies have accelerated in the pandemic era and is bound to continue beyond it to bring the next significant change.