The rate of disruption occurring in the financial services industry in an exceptional level, with increasingly more fintech organizations, climbing the positions and changing the manner in which innovation upgrades the experience of moving cash. For organizations in the financial services industry, the disturbance brought about by innovation drove changes has been relentless.
The extent of fintech has developed path past the fundamental functionalities of online banking, and now envelops advancements that reach out to informing innovation for showcasing money related administrations, all day, every day virtual assistants, mobile apps, voice banking, social media integration tools and more.
This course of steady development is driving the market forward, while demanding the consideration of banks and credit unions that ought to remain competitive in order to satisfy the ever-evolving needs of consumers.
One of the key variables driving industry changes is consumer behaviour – and all the more explicitly, millennial behaviour. In the UK, millennials are considered as the most valuable demographic group as they make up a large percentage of the population.
Thus, banks, credit unions, mortgage companies and businesses in the wider financial space who are keen on achieving sustainable growth need to invest time and money into understanding the demands of this highly relevant group of consumers.
Millennials have been heavily influenced by the ease of technology in most aspects of their life. With regards to banking, their expectations are similarly as high; low fees or no-charges banking and excellent customer service are a few of their challenging demands.
An effective strategy for banking institutions is to invest in digitalizing processes with the latest technology that can aid in reducing costs and improving customer service.
Some of the Fintech trends that can give banking institutions a competitive advantage includes:
- Live chats for customer service–
Traditionally, banks have limited availability and opening hours that don’t work for many customers, which ends up causing much frustration. Live chat platforms are growing in popularity as a channel that provides ease of communication and quick answers for customers. Financial institutions can adopt live chat for support and be able to see outstanding results in terms of customer satisfaction.
- Context based automization-
Automated messaging through different channels like email and SMS, combined with contextualized data, can help businesses to effectively sell their products or services, keep customers informed at different stages of the journey, and promote upgrades, upselling strategies, plan renewal, and more. For banking, automations can be the core of sales and marketing communications to nurture leads and keep customers engaged with tailored and context-based messaging.
- Self-Service banking-
Customers are desiring solutions and answers readily available, and this creates a need for banking to offer services in the most accessible way, in the form of self-service. Apart from contactless payments, customers require innovative banking tools for transferring money abroad, paying to other accounts, accessing other digital currencies a without the need to deal with an agent of physically visit a branch.
The possibilities that accompany this ‘decentralization’ of financial services could make an environment where banks and fintech organizations can work all the more cooperatively in sharing assets, and accordingly making it simpler to keep up in our quickly evolving world.
However, there really is transformative change in progress that will redraw the financial services landscape in ways that should expand inclusion. A number of distinct and innovative business models are emerging, often driven by people and companies that come from outside the traditional banking sector and do not identify with legacy banks, their business models, or their approaches to financial services
As a heavily regulated industry, financial services need consumer trust. This may be why we’re seeing a shift in customers choosing smaller, more personalized (and transparent) service from startups that specialize in a certain sector of finance.
The regulators themselves will begin to turn to better technology to ensure that their compliance measures are held up, putting big banks in a tricky position to keep up, which means re-defining their traditional processes, particularly for paperwork. Because fintech is designed as digital from the beginning, there is no paperwork, and there’s a lower risk for incidences of the kind of fraud that comes with that.
The idea for regulators here is the ability to pick up or predict problems before they actually become an issue and they have to remedy this after the fact.
It’s likely with the uptake of fintech startups around the globe that more and more people will turn to these companies for their financial needs.