The way we manage, access, and plan for our finances evolved over the year; and much more influenced by the COVID-19 pandemic that hit in 2020. Even if a lot of businesses have been hardly hit by the health crisis, the financial technology or fintech industry reported rapid growth despite adversity.
Before anything else, what is fintech? As per Investopedia, financial technology is used to describe new tech that seeks to improve and automate the delivery and use of financial services.
Shaping our financial markets, here are the top fintech trends 2021 to watch out for.
1. Autonomous finance
Technology has improved the way we live and the way we do things. With that, more people tend to look for more possibilities to improve their daily living by creating more time for themselves. That said, financial management also needs to evolve and adapt to our needs.
Ever since self-service solutions became rampant, businesses have been using this strategy to put consumers in charge of the services they use. On that note, autonomous finance helps take the burden off of our shoulders and automates our decision-making process in terms of our finances with the help of AI and machine learning. Various fintech solutions make it possible for us to manage our money, access our accounts, apply for loans, and others with just a single click.
2. Open banking
With more and more people getting more aware of their finances, the desire to have more options in growing their money through investments and other financial instruments is also on the rise. This is where open banking comes in.
Via open banking, third-party financial institutions partner with traditional banks to offer flexible, high-income-generating investments. Although traditional banks are known for safeguarding people’s money, the innovation of open banking can compromise the data privacy of consumers’ information. On the brighter side, this can be prevented if both parties will collaborate toward safe open banking.
3. Digital-only banks
Nowadays, most people consider long queues at physical banks a hassle. When the pandemic hit, that was the only time when banks realized that total eradication of physical contacts for banking transactions is possible. Since a lot of people needed to access their funds virtually during the lockdown, conventional banking couldn’t keep up.
That said, digital banking has evolved from being another convenient way to access finances into a must-have solution nowadays.
4. Biometric security
Fintech services are in no way completely safe from cyber attacks and data privacy issues unless properly mitigated. As these solutions become more accessible to almost everyone, businesses need to step up their cybersecurity.
Biometric security procedures ensure that users can maximize their privacy online as only they can access their accounts and data. These include facial recognition and fingerprint authentication systems.
5. Voice technologies
Younger generations are now considering voice-based tools over chatting. With this, it’s no surprise that they seek fintech tools that introduce voice technology.
AI-powered fintech voice assistants offer convenient and simple handling of finance-related processes. Also, voice tech is one of the newest fintech trends that allows for more secure payments through the use of biometric data for payment authorization. Overall, this and other fintech trends aim to offer a common advantage: convenience in the way we do banking.
As technology opens more opportunities in handling finances, there’s no doubt that fintech has nowhere to go but up in the coming years.
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