Emerging financial technology is the largest driver of exponential growth in the banking industry worldwide. Given the acute need to beat the competition using fintech innovations, industry players have digitised their game – from making a payment app more intuitive to using the cloud for data storage. Emerging technology is the new order in today’s world.
What is Emerging Technology?
Emerging technology is a term that covers a broad spectrum of innovative or disruptive technologies that change the way we live, work, do things, and interact with one another. Largely dependent on digital technology, these are newer and better ways of applying scientific tools and knowledge to solve everyday problems.
Emerging stands for something coming into existence to challenge how things were done. Emerging technologies provide better, faster, more efficient, and more rewarding ways of doing things and achieving results. It challenges the status quo and reimagines results for improved experiences.
Which Emerging Technologies Are Going to Impact Banking Operations
Below are some of the emerging technologies that will be impacting the banking sector over the coming years:
1. Mobile Banking Capabilities
One of the greatest revolutions to the banking experience is mobile capability. Customers no longer need to enter banking halls for financial transactions. Using their mobile banking app on their phones, they can make deposits, transfer funds, open and create accounts, book hotel and travel, pay utility bills, buy call credits and browsing data, access instant loans, and pay employees.
Each aspect of these mobile functions will be upgraded to boost consumer experience in the coming years.
2. Rise of Online Banks
Have you noticed the rise in the growth of online-only digital banks? These are banks that do not have physical addresses and that operate online. These digital banks attract customers by offering loans without collateral and higher interest on Fixed Deposits (FDs). But one of the greatest benefits of these online banks is privacy; you can open and operate banking accounts with these online banks without any physical trace or proof. As it stands, digital-only banks are revolutionising the financial sector where traditional banks once held sway.
3. Blockchain Technology
Blockchain technology, such as the one powering cryptocurrencies, is a distributed digital ledger that sustains a widening list of data blocks containing batches of transactions that cannot be revised or tampered with. The financial sector is gradually embracing blockchain for cryptocurrency and other digitally-decentralised transactions such as the ones for a payment app.
Blockchain utilisation in the banking sector will improve fraud detection, enhance transparency, boost seamless transaction handling, and streamline cross-border transactions. It will also heighten privacy and security for online customers, and it will guarantee better control over assets and personal data.
4. Artificial Intelligence
Artificial Intelligence (AI) is also employed to empower customers using banking tools and services. From live chatbots that can help customers solve their problems to authenticating customer identities and claims, AI can analyse vast customer data and enable financial institutions to make better lending decisions.
AI can do things humans cannot in terms of risk management, fast customer service, automated loan disbursement and recovery, identity authentication, and lower operational overhead costs for management. The algorithms of AI can be tweaked to perform any function within and outside the banking sector, and it is revolutionising how we live today.
5. Internet of Things
The Internet of Things (IoT) is driving the financial sector to newer heights. With the ability to sync home and office appliances, IoT can increase business efficiency without compromising user experiences. With voice commands and machine language, physical objects such as mobile devices, vehicles, electronics, security sensors, and connected gadgets can instantly monitor human behaviour and resolve business crises.
6. Cloud Computing
Because of the need to do away with cumbersome hardware and eliminate maintenance costs, financial institutions now store customer data online via cloud computing. Cloud computing can be used for various financial products such as the ICICI Bank iMobile Pay and other customer-centric services deployed by banks.
Cloud computing facilitates remote access to online data and applications, boosting privacy and data protection.
Conclusion:
Emerging technology will continue to impact banking operations for decades to come. Newer digital innovations will disrupt the market, and consumer experiences will hit an all-time high.
