The digital age and the rapid advances in technology have redefined the financial sector. A technology-first approach is the future of banking as investments in the digitization of finance and the adoption of technology in the field of banking are growing exponentially.
Fintech is a term used to describe the use of technology in financial transactions. The essence of Fintech is the use of digital technology to bring innovative financial products and services to people.
When one thinks of Fintech, terms such as online banking, Big Data, mobile payments, among others come to mind. Fintech offers increased efficiency for consumers and lower costs, promoting easily accessible innovation for both consumers and retail banking companies.
A PwC Global Fintech Survey 2016 once asked respondents: In which areas do you see the most important impact to your business from Fintech?
75 percent of the respondents felt that Fintech would allow them to meet changing customer needs with new offerings.
Why Fintech Partnerships?
60 percent of credit unions and 49 percent of banks in the United States believe that Fintech partnerships are important, according to a 2020 study.
Fintech Is the Future of Banking
Fintech has revolutionized financial services. Banks are evolving ways in which they interact and engage with customers. Let us explore how Fintech is the future of banking.
Gone are the days when you had to conduct financial transactions and bank-related work only during banking hours. The proliferation of technology in the world of finance has made banking possible at any time and from any place. Banking has moved seamlessly to mobile devices. This means people can transact from anywhere in a matter of minutes.
Enhanced Payment Methods
With the rapid growth of electronic payments and digital wallets, cheque transactions are now almost obsolete. The cheque, as a medium of payment, does still exist. However, several banks are embracing faster methods of money transfer between bank accounts through e-wallets such as PayPal, Stripe, PayTM, Venmo and others. You just need your mobile device linked to your bank account.
Today, a customer will rarely find the need to enter the bank’s branch where he/she holds an account. This is because even the most mundane of banking services is accessible online or on mobile.
Consumers and Future of Banking
A biennial Fintech consumer adoption report from Ernst & Young shows that globally, consumers are adopting Fintech services much more rapidly than initially anticipated.
Fintech Is the “New Normal”
The outbreak of the COVID-19 global pandemic has impacted all industries around the world. Global lockdowns have become increasingly frequent since 2020. Research shows COVID-19 impacted banking and financial services to a great extent. 73 percent of Americans view Fintech as the “new normal.” It is, to put it simply, the future of banking.