Numerous Fintech companies have come up in recent years, and they are here to stay. Lately, we have observed them become a part of our daily lives, aiming to simplify our overall finances. Technology has continuously proven to be a driver of innovative approaches, and it is no shock that it has transformed the financial world. The recent financial technology has indeed managed to overshadow most traditional financial institutes and services through its advanced capabilities, instant processes, and effective customer service. What are the benefits of the various fintech innovations that have driven such a massive investment in the previous few years? Let’s find out!
What Are The Advantages Of Fintech?
Enhanced Flexibility And Convenience
No traditional financial institutes seem more flexible and manageable than fintech considering the working dynamics starting to command in various financial companies presently as telecommuting trends grow stronger. Besides, fintech organizations enable their existing customer to carry out almost all sorts of operations from any place and at any time they want in an effortless method. For example, fintech advancements allow their customers to request a loan without having to step out of the house, with just a couple of clicks, eradicating paperwork at the bank. Such convenience and flexibility make the customers feel valued and, ultimately, improve customer satisfaction.
Several online or digital moneylenders can allow same-day lending if the candidate is accepted, which is entirely permissible because of the progressions made by fintech. Customers expect the ability to receive the services they require instantly. Therefore, 90% of banks expect extensions in mobile apps and websites, with a growing focus on ‘digital-first’ to maintain interactions with the customers. Several lenders have presented a more immediate decision method seeking lesser data from the candidate while still following the FCA lending guidelines. Such an automation method has led to customer happiness, with AI presumed to power 95% of customer communications in the following decade.
The accelerated expansion of fintech is also assisting in bringing unique opportunities to enhance transparency, cut down costs, and obtain data more accessible. Fintech is bettering to guarantee that this data is always at a consumer’s fingertips. Those people belonging to the lower economic group, having limited education, have restricted financial knowledge and experience mainly due to the lack of access to several other resources. However, fintech has managed to solve that problem, too. Technologies like AI aided Robo-advisors’ advancement, interact with consumers in real-time, and offer financial pieces of advice and other financial products. One such example is the live chat.
Low Transaction Cost
Several people and companies find it troublesome to secure loans due to the lower credit score or the absence of credit records. But with the help of fintech, we have applications and digital services that take care of all the factors. It not just aids loans but also encourages users to develop their credits. Besides, fintech has proffered peer-to-peer lending more comfortably. Applications like Venmo have eliminated the banking institution mediator and allowed customers to pay and receive money from others without paying a high-interest rate or transaction expenses.
Easy Banking Alternatives
Apart from mobile banking, there are many innovative choices in traditional financial institutions, making banking more relaxed for customers. An example of such advancement is the interactive teller. It is a machine that resembles an ATM and offers much more services that would typically demand a person to person handling, like providing pieces of advice, updates, upcoming schemes, and so on. It is done by connecting the customer with an actual bank employee through a live video. Such options are beneficial for those who work more, are often busy, and cannot visit the bank during its working hours. Besides, it also helps disabled people and those living in rural areas.
With speedy innovations comes the requirement to tighten the security protocols, and fintech inventions have inspired this. One of the emerging creations following the growth of smartphones utilizing the technology is biometric authorization. Proving even more secure than a password/ PIN, applying your fingerprint to approve any transaction and payment is the next move in ensuring digital-only deals in the future. Both Visa and Mastercard have tried biometric banking cards in the previous years, and the indications are promising for extensive usage. Blockchain technology’s advancement is another reliable way of storing data on servers, revolutionizing the financial markets.
The present and up-coming status of fintech innovations are in excellent health, with the increase of investment and more businesses getting on board with the advancements. Around 82% of traditional financial institutions are expected to develop fintech partnerships in the coming three to five years, suggesting that many more innovative changes are likely to occur in the future.