Essential Technology For the Finance Industry

It’s no secret that technology is the skeleton key that opens consumer gateways and that technological capabilities are rapidly improving. With developments in mobile banking platforms, peer-to-peer transactions through apps like Venmo and PayPal, and introductions to a newer kind of trade through cryptocurrency, technology has become an absolute necessity to understanding and serving consumers within the financial industry.

Today’s Essential Tech

Big Data

According to the IDC Semiannual Big Data and Analytics Spending Guide, banking is one of the top investors in big data and business analytics solutions. Information tracked from credit card transactions, ATM withdrawals, and credit scores drive a significant part of this investment. Understanding consumer behavior based on their spending and transactional data is vital to finance companies’ optimization of their developments. Collecting and making smart use of this kind of data helps financial institutions better understand consumer habits and develop corresponding products and service enhancements.

Smart Solutions

Algorithm-driven decision-making is a science that can impact both customer-facing and behind the scenes solutions for financial companies. Through automated chatbots, customers are introduced to interactive solutions with a more personalized touch than just your average auto-chat, but less resource intensive than human-staffed solutions.

On the backend, companies can deploy automated smart solutions to help process loans and insurance underwriting, with strong impacts on product delivery, risk management, marketing, and security. Technology can be pivotal in deploying effective solutions for processes that financial companies rely on to boost customer satisfaction and retention, such as documentation, data sharing and analytics, and touch-point-based communication.

Digital Experience Platforms

Companies have learned to capitalize on customer experiences for more than just account information. Through enhanced digital experiences, companies are able to leverage customer data to provide personalized experiences based on their previous interactions. Customers can check their spending in automated categories like groceries, travel, and dining out based on their previous card usage in charts or diagrams right within their home screen of the app.

Easier, secure access to financial information and payment delegation is increasingly expected. The usability and security of a financial institution’s digital experience platform will be essential to drive future consumer acquisition and retention.

What’s Next In FinTech

Blockchain

Blockchain technology is essentially a type of data and information storage that chains together blocks of information in chronological order. Most commonly it’s used as a ledger for transactions, such as Bitcoin and Dogecoin. Additionally, it is quite common for these transactions to be processed in a decentralized way so that all users collectively preserve control. These decentralized blockchains are then fixed, irreversible data, in which it becomes permanent and open for public viewing.

Though this unique form of peer-to-peer financial technology is still novel, it has inspired the development of other platform-level decentralized interactions. Experts believe blockchain will quickly become a prominent feature in fintech solutions for payments, fraud reduction, loan processing, and smart contracts as the industry continues to develop real-world applications of the technology.

Machine Learning

Uses for machine learning and data analysis for financial companies will continue to grow as advancements are introduced and consumer trends shift. With machine learning data, automated algorithms specifically designed to capture consumer habits can be connected to the development of stronger marketing campaigns and deeper understanding of consumer behavior.

The collection and interpretation of analytical data captured by these algorithms further informs how consumers use their personal or trade finances – making consumer information an even bigger asset to innovations in the financial industry.

Key Takeaways

Adapting alongside both technological capabilities and consumer trends is indispensable to the success of financial companies. The blueprint of success derives from one major factor: consumer data. With technology processes that can gather and analyze consumer analytics, financial institutions that learn to quickly make use of it will stand to gain the most.

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