1. Consumer Expectations
One area in which the impact of FinTech has been highly visible is in the closure space. Prior to the proliferation of FinTech, consumers would interact with financial services in certain ways.
Deposits had to take time due to queuing unless you deposited at a teller machine and loan processing was cumbersome.
FinTech has made consumer loans much easier and quicker to get through digital means. It has also made deposits and other transactions more flexible and instantaneous, all of which has shifted consumer expectation.
2. Bank and Finance Operations
The advent of FinTech has had a notable impact on how banks operate on a day-to-day level and also strategically. Commercial banks now find it easier to deploy FinTech in areas with repeatable functions that can be automated to cut down on costs.
Lenders are now optimizing their physical branch rollout by moving several services to digital channels enabled by FinTech.
3. Business Models of Financial Services
Fintech has revolutionized much of the traditional banking business model. Since the opportunity for digital financial services became clear and the use cases more defined, more startups have chosen to adopt new business models.
A good example is the rise of online lenders. Online lending firms are companies that purely operate online in their service provision. They perform core lending duties that traditional players have been doing without the need for any brick-and-motor presence.
4. Currency Formats
Another way FinTech will likely change shortly is that more people will do their monetary transactions with cryptocurrency (at least that’s the current prediction), and more investments will occur with simple smartphone apps rather than having to call a broker for advice on where to invest your money. There’s also talk that the Federal Reserve may change in the way our money is backed up. The President is talking about backing it with gold and completely changing the structure of the way it does business. This is so that consumers will have more power over their money and investment options.
Technology has become an unstoppable tidal wave hitting all areas of business. The financial services sector is no exception to this change. In its wake FinTech has altered business operations, how customers perceive financial services and even how opportunities are modeled. Understand how this rising tide of change will impact your financial life to better navigate the changes.