The world is rapidly shifting to the online realm; digital platforms have grown exponentially in the last two years. With ever-changing users, Making banking services more user-friendly has become a necessity. As a result, fintech was born. In terms of the new normal, the fintech sector is expected to undergo significant change in 2022. The fintech market value will reach $309.98 billion by 2022, more than doubling its value in 2018. A plethora of digital innovations in payment and banking technology, whether consumer-to-consumer or merchant-to-consumer, appear to be redefining financial processes.
India's payments infrastructure has seen significant improvements, particularly in the last few years, and the country has emerged as one of the world's fastest-growing FinTech hotspots. This is in response to the introduction of new payment interfaces and mechanisms such as the Unified Payments Interface (UPI), Immediate Payments Services (IMPS), Bharat Interface for Money (BHIM), and others. Government initiatives such as Make in India and Digital India have been vital in accelerating the country's adoption of Fintech services. Furthermore, the Covid-19 pandemic has accelerated digitization and cashless payment adoption, even in the most remote parts of the country.
Some of the trends that we expect to drive innovation in the banking industry are:
New Payment Technologies adopted at a rapid pace:
FinTech applications will soon focus on faster transactions, newer payment methods, and improved accessibility. Customers are more inclined to apps that offer services such as tap and go payments, buy now and pay later, and so on, as the use of AI in stores grows, and the popularity of contactless payment options grew subsequently after the pandemic.
Digitalization of Employee benefits with Fintech
Employers can revamp their employee experience and benefits strategies by offering services such as on-demand pay-outs and earned wage access combining HR technology and FinTech applications. Fintech companies can aim to digitize cash-heavy industries, reduce physical checks, and pilot cheaper products as a result of tech-friendly regulations and employee demand for faster pay-outs.
These trends, however, are only the tip of the iceberg. As the FinTech industry develops and expands, it will continue to shape the future of banking and payment services, delivering seamless consumer experiences and digitizing the Indian economy.
The rise in AI and ML:
The banking industry has benefited from artificial intelligence (AI) and machine learning (ML). Because of their ability to analyze real-time patterns, they have enabled banks to process large amounts of data and reach conclusions, allowing for faster decision-making. They are increasing their effectiveness while also working more efficiently. This has made various banking processes more efficient and cost-effective. In the banking industry, AI boosts employee productivity by 59%. It has reduced loan defaults and made transactions safer, all in the name of providing a better customer experience. Banks will be able to cut costs by 22% by 2030, saving nearly $1 trillion. Many fintech companies are constantly researching AI applications that would benefit banks and their fraud detection processes, customer service, credit service, and loan decisions.
Customer services:
The financial sector's primary goal has been to provide customer-centric solutions. User experience is a significant factor, and for the new generation of customers, speed and ease of access without sacrificing security are critical. This generation despises going to the bank, filling out paperwork, printing it, and signing it. The primary goal will be to completely automate financial processes and eliminate all manual processes.
Nowadays, the banking industry is one of the essential industries in the Indian market, and the trends are ever-evolving. Even during difficult times, such as Covid-19, such rapid digitalization ensures that banking and financial services are not disrupted. As a result, these digital factors will highlight growth in the fintech sector as a whole.
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