As we enter into the year 2021 and retrospect 2020, there is one thing the past year has made extremely clear, that digital is the primary way forward for BFSI. Let it be the ever-growing demand for digital banking paving a new way or industry giants adapting to changing times, fintech is here to stay. Keeping that in mind, here are some of the trends that may not necessarily be new but are surely going to be adopted at a larger scale and a much faster rate.
Banks that are completely digital
Digital-only banks are essentially institutes which provide the financial features of traditional banks in an online mode such as P2P moves, international remittance as well as free exchange charges; these banks sometimes also extend their services into domains such as cryptographic forms of money like Bitcoin, Ethereum, and some more.
These banks have piqued interest in a brief period. Significantly so, on the grounds of extreme accommodation to client’s need and ease, by disposing of repetitive desk work, holding up in long lines, and the need to visit a bank.
Digital banks are to see a surge in the coming year, causing a critical drop in the number of individuals who visit a brick & mortar bank. According to a report, this number is to drop by 36% from the year 2017 to 2022 and its primary driver will be the ascent of digital-only banks.
Robotic process automation
It can be best described as a process automation technology which primarily uses software robots or digital workers to speed up their tasks or automate them. With many leading banks such as Kotak and HDFC relying on AI-powered customer assistants, Keya and EVA respectively, it does not come as a surprise that Robotic Process Automation is here to stay.
The financial service industry has already adopted this process to cut costs and improve the efficiency in the organisational functioning. Apart from this, financial institutes have also adopted RPA digital workers to automate the back-end office processes such as security checks, customer onboarding, maintenance of accounts etc. The primary benefit of RPA is that digital workers can finish the tasks a lot more efficiently, allowing personnel to focus on more critical areas.
Blockchain technology has, without a doubt, transformed how the fintech industry works. With this particular cutting edge tech, transactions are carried out in a much faster and secure manner. Due to this, both financial institutes and banks are adopting Blockchain Technology to gain a competitive advantage.
As per a report published in Business Insider Intelligence, around 48% of the banking representatives think that Blockchain technology will continue to have a big impact on banking in 2021 and future.
Some of the other trends that would have an impact in 2021 include Artificial Intelligence, Machine Learning, Acceleration in financial inclusion, Bio-metric security system and many more. We look forward to 2021 and see the amazing trends that fin-tech is going to bring about.