Advanced technologies, digitisation, and changing consumer demands are leading financial services companies to adopt a more consumer-centric approach.
As a result, many companies have launched innovative products, services, and solutions. The use of advanced technologies – which include cloud, platforms, Internet of Things (IoT), artificial intelligence (AI), machine learning (ML), blockchain, and application programming interfaces (APIs) – impact operations of companies and customer experience.
The application of technologies enhances the outcome of services and sub-segments like fintech platforms, Robo-advisory, InsurTech, RegTech, and PayTech, which are expected to grow rapidly. While it is early days for Quantum Computing, the use cases and experiments are extremely encouraging.
The latest Frost & Sullivan analysis, “FinTech – Growth Opportunities in the Global Market”, highlights emerging products and services, technology-enabled sub-segments, new business models, and innovations that are set to disrupt the industry.
“With the number of connected devices expected to reach 40-billion by 2022, big data will significantly increase the need for cloud storage, analytics, AI, and ML within the financial sector. The impact will be seen across banking, wealth management and insurance, and we can expect a significant shift in how the industry operates,” says Frost & Sullivan Information and Communication Technology Senior Industry Analyst Deepali Sathe. “New business models and innovative products and services from neo-banks, InsureTech, and WealthTech companies will drive the change in the entire industry.”
The report covers many aspects across the global FinTech sector; namely, BaaS, InsurTech, WealthTech, RegTech, PayTech, and provides forecasts as well as regional trends. The trends are further illustrated with examples of successful implementation.
Factors driving growth within the global financial services market include:
* Financial services companies that are adopting a consumer centric approach to provide personalised services and an enhanced customer experience;
An increase in partnerships between incumbents and start-ups to promote rapid innovation and achieve faster time to market; where start-ups contribute agility and incumbents provide scalability
* The application of technology and enhanced outcomes across different areas within FinTech are driving growth opportunities across BaaS, RegTech, InsurTech, PayTech and WealthTech
* A technology-enabled omnichannel approach, which enables a consistent and seamless experience for consumers across different channels, devices, and multiple touchpoints;
Anytime, anywhere access to financial services is critical for success.
“Alternatively, factors hindering market growth include issues related to security of data, the regulatory environment and prevailing confusion, lack of skilled personnel to apply advanced technologies, and a slow pace of change,” says Sathe. “The industry is gearing up to meet these challenges by working together in order to create a more cohesive ecosystem, including liaising with regulators to ensure greater clarity.”