The world of financial services is changing. FinTech is shaking up the market and people want different things from their bank.
Incumbent players in the industry are listening however and are trying to adapt.
Timeline for banks
- October 11, 2017
Blockchain technology has shown itself to have a great number of potential uses and banks want it for their own.
Cashless societies are moving closer to reality and in certain countries, people are finding carrying cash increasingly irrelevant.
Cybercrime is now big business and protecting customers from attack is now expensive and difficult.
For its part, the stale insurance market has been using new technologies to break the mold and robo-advisors are becoming the norm in the wealth management industry.
Block Chain and Cryptocurrency: Financial markets racing to adopt tech
The rise of cryptocurrencies is due in the main to the clever technology that allows it to function as a kind of distributed ledger system, called the Blockchain.
Many in financial services have been sceptical of cryptocurrencies; seeing their trading volatility and resistance to normal financial regulation in a dim light.
However, whilst spurning cryptocurrencies, the financial services industry has woken up to the potential of the Blockchain technology.
The Blockchain is effectively a far superior and safe database to any current systems that can be altered in multiple places at once across country borders and markets and can work for many more things than just money alone.
Cashless economy spreading as culture shifts and technology solves problems
The cashless economy has been a longstanding ambition of the financial services industry.
Now changes in culture towards the use of digital money for everyday purposes, even tiny purchases, and innovative technology, have allowed countries such as Sweden to move very close to a cashless society.
3 Things That Will Change the World Today
Innovation in transactions and banking has spread efforts to grow the cashless economy to the developing world, ensuring the move away from hard currency is likely to become a global affair.
Problems, of course, remain and must be overcome to ensure concerns regarding change are addressed.
Financial services developing to counter cyber-crime threats
Most financial crime now takes place online.
Successful break-ins have the capacity to remove vast sums of money and ruin the carefully developed public image of leading banking institutions and associated companies.
To meet an evolving criminal threat companies involved in financial services must adapt quickly. Under pressure from consumers, governments, shareholders and other interested parties, regulations are changing.
Regulation technology is being heavily invested in, fraud detection is improving and major companies are paying ever more attention to the cybercrime threat.
For financial services, criminality is a major trend which will play a critical role in decision making and future strategies.
Insurance market set for rapid change after embracing technology
Long regarded as a sclerotic and somewhat unmoving market, insurance is beginning to experience rapid change after the potential benefits of technological advances are being felt.
Investment is now flowing into tapping the gains on offer through understanding big data, creating a whole new field in so-called insurtech. Insurance is moving away from a very structured model and is becoming more flexible to suit the desires of customers.
For the first time consumers are able to demand policies to cater towards personal circumstances, even online.
Such is the pace of change instigated by disruptors the market could soon be unrecognizable compared to even a few years ago.
Robo-Advisors: Complex algorithms and AI are proving popular in wealth management
Robo-advisers are a new category of financial service product that can offer some unique benefits to those interested in wealth management services.
From start-ups to the biggest incumbent players, most institutions in the wealth management industry have their own services.
Companies offering these products are capturing the desire for cheaper monthly rates, advice more heavily based on mathematics and fully impartial advice.
Essentially what these companies are trying to provide, or what is the long term aim of this type of product, is an AI wealth management service and the robo-adviser market today is a kind of halfway house between a traditional human adviser and what will eventually be the norm, when full AI tools role out in the future.