Banks are the biggest users of technology today. However, it is fintech that brings technology to the heart of financial offerings, thus fundamentally changing the way companies interact with their customers.
Banks are the biggest users of technology today. However, it is fintech that brings technology to the heart of financial offerings, thus fundamentally changing the way companies interact with their customers. Such a state of affairs has an extremely beneficial impact on society, as reducing the cost of financial services significantly saves consumers’ money, and greater access to payment instruments for various segments of the population contributes to their dissemination to those who have not yet been physically able to use bank accounts and money transfers. When you use ApplePay or just your credit card to make online purchases, you, as a consumer, online store, and your billing bank, use fintech.
Traditional banks, insurance companies, and other large financial institutions are also investing in the development of financial technology. Some integrate solutions into their products and services, others work directly with such companies, and others even buy these companies or create fintech incubators. According to Roomian.org, the portfolio of such a large global bank as Citigroup already has 13 startups. Goldman Sachs has 10. And JPMorgan Chase has 5.
Because fintech startups do not operate as universal banks or insurance companies, do not offer a full range of operations, they are not subject to the same regulation as other traditional financial market players. Thus, many oversight institutions today need to understand the new business models of market players and review outdated regulatory approaches. This will strike the right balance between innovation and financial stability.
The digital revolution, which has already radically reshaped the media market, has reached the financial industry. Even small banks and financial companies have long understood the benefits of having their website and electronic databases. And with the rise in the number of millennial customers, a boom in mobile apps has begun, greatly simplifying the provision of financial services.
The ways of further development of this technology look amazing. Experts believe that in the exchange of information both inside and between industries, blockchain will allow reaching a whole new level. As the relationship between blockchain and other emerging technologies, such as automation and cloud solutions, blockchain helps companies create and realize benefits that cannot even be imagined with existing technologies.
Essentially, derivatives are designed to protect your open positions in stocks, bonds or any cryptocurrency. Financial instruments, such as futures and options, will provide an opportunity to hedge risks and also help stabilize the exchange rate. Many companies and individuals are betting on the long-term prospects of Metahash and MetahashCoin, hoping that the value of the currency will continue to grow.
Data decentralization and peer-to-peer networks. Blockchain protocol has shown us all the features and benefits of a decentralized registry and is even gradually pushing for a whole new model of the Internet. Reducing the value and speeding up of cash transactions, p2p lending (without banking), distributed storage and trading of securities, smart contracts in merchant financing are just a small list of the capabilities of the distributed registry platform.
– Crypto assets. National currencies, of course, play the first role in the world of finance today. But the cryptocurrency boom clearly showed people’s desire to have alternative ways of calculating among themselves.
– Artificial Intelligence. The use of chatbots in customer service, the purchase of goods through the voice assistants of mobile phones or other devices are used now. However, such solutions reduce for financial institutions one of the biggest cost items – personnel costs. And so, probably, in the nearest future, they will occupy a dominant position in the structures of the front offices.
Market participants who have begun to use blockchain at the dawn of the advent of this technology, such as cryptocurrency traders, have helped blockchain become widespread in the mass market. But there remain a large number of skeptics who view the technology as the driving force behind an unstable and unregulated financial market.
It is expected that as more companies invest in human resources and financial resources in blockchain, and increasingly understand how this technology can improve their business processes and financial results, blockchain technology will gain in popularity as its benefits in the area of economic costs, competition and return on investment will become more prominent.