Will Technology influence the future of finance and to what extent? Digitization is disrupting a lot of industries and finance is no exception. The fintech industry has been shaped by the rise and rapid adoption of transformative technologies they enable.
The way we manage, access, and interact with our finances has been revolutionized as fintech emerged as a driving force to empower individuals, businesses and entire economies to reimagine the future of finance.
In order to grasp where the fintech industry is going, and to understand its importance. let’s explore the advanced fintech software solutions that had a great impact on the daily lives of billions of people.
FinTech market capitalization and Revenues
Fintech became mainstream in certain segments, especially payments & transaction banking. Today there is almost 32,000 fintech globally that serve as a catalyst for broad consumer adoption of digital financial services.
Over the past time, the fintech sector attracted more than $500 billion in funding. Since 2019, they received 20% of global venture capital outlays by tracting large amounts of capital from a generalist, technology private investors and hedge funds.
Crypto accounted for more than $50 billion in funding in 2021 and 2022 roughly 75% of all crypto funding received through 2022. At its peak in 2021, fintech represents 9% of all financial services reaching $1.3 trillion.
The consequent shifts in the financial landscape have been felt both by fintech and investors, and fintech CEOs are now targeting profitable growth and focusing on strengthening fundamentals as their top priority.
Phases of FinTech Chronic Evolution
There is always significant room for growth in digital usage in banking. Every year, a new phase is initiated to cope with the futuristic demand of the users. Here we will go through the phases of Finance and how it evolves from time to time.
- Digital disruption
With the enhanced availability of the Internet, financial services went digital at that time. The digital platform offers great convenience and accessibility to consumers, eliminates pain points, online banking and e-commerce. Online payments emerged as the largest innovation disrupting the banking industry that gives users more comfort and convenience to make their payments safe and secure.
- Improved Cash Flow
Optimizing inventory levels ensures that organizations do not tie up excessive capital in excess inventory. By aligning inventory with actual demand, organizations can free up cash flow and allocate resources to other critical areas of the business, such as product development, marketing, and expansion.
- Mobile & Social Adoption
A credit boom and rapid innovation in mobile and cloud allowed consumers to access financial services in real-time. Focus on user experience/user interface (UX/UI) and the introduction of APIs eliminated many points of friction during both the onboarding process and, later, the customer’s digital journey. Social and mobile e-commerce plays a key role in allowing companies to gather information with high personalization.
- Relevance & scale
During the covid 19 pandemic, consumers expect to get all financial services to be available online 24/7. Various fintech platforms such as Paytm, Stripe, Nubank and many gain popularity in the coming years. Fintech funding surged to $440 billion between 2014 and 2022 via online platforms that gain a hike with time.
- Looking Beyond 2022
With such an exotic achievement in the field of the fintech industry. We foresee a more proactive regulatory environment paving the way for supportive infrastructure investments. Moreover, new stages are set for new technological advancements such as generative AI and DLT. Let’s see more new offers in the coming advancements.
Emergence of new technologies in the FinTech Sector
New technologies are entered in the fintech market for the first time to not only handle the capabilities but also be beneficial for society as well. Let’s explore the new driven fintech solutions
- Distributed Ledger Technology
DLT is specifically used to create a worldwide transactional and settlement platform using stablecoins. This platform is predicted to be fast, inexpensive, transparent, borderless, and secure which eliminates the need for intermediaries and reduces the time and cost of settling payments.
- API-based open Connectivity
To create seamless modular access and permit the standardization of interfaces for banks, corporates, and governments. Such entities will be able to plug in through APIs to gather customer data, provide advanced financial services, and facilitate collaboration between FIs worldwide.
- Embedded hardware Iot & Biometrics
It is used to develop highly personalized financial products such as energy-efficient mortgages and home insurance. Similarly, advanced smartwatches can monitor health statistics to tailor health insurance properties. IoT devices can also be used to trigger automatic financial transactions, which can be especially practical if combined with smart contracts.
- Generative AI
This new invention in AI has created a step change in the human-digital interface. It not only provides high-level customer service but also helps businesses to maintain their financial security. This technology will enable the hyper-personalization of financial products and services and analyze vast swaths of data to identify patterns as well as facilitate human decision-making.
Revolutionize the Financial Ecosystem with our FinTech Applications
Our technology experts provide you with top fintech solutions to cope with industry-specific challenges and give strong competition to the market. We provide services from mobile banking apps to complex enterprise financial solutions to keep up the pace and turn your finTech dreams into reality.
Our experience in the finTech space ranges from money remittance system, stock trading platform that includes ETF and Crypto, robo-advisory / Spare change investment platform, mortgage Planning system with the use of Financial Aggregator services, funds management, credit monitoring and wallet system/ banking API implementation.
We at smartData integrated various banking APIs like KYC using plaid or true layer, hyperledger, TRX10 based tokens in TRON. Other than that, investment APIs for stocks i.e. Interactive broker and independent reserve and crypto as well as integrating exchanges like (Binance, Poloniex, Gemini, and Bittrex).
Embrace digital transformation in financial services with our top software solutions. Connect with us!
Conclusion
Lastly, with the invent of finTech, financial services are becoming more accessible, efficient and personalized. From breaking down barriers to financial inclusion and reinventing payments to transforming lending and borrowing practices, this ever-evolving platform reshaping the financial landscape in profound ways.
The power of FinTech innovation comes along with new strategies that broaden our way of thinking and give us innovative techniques to modify our financial infrastructure. Let’s work together to nurture its new approach and come up with a better solution. Connect with our technology experts now.
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