Fintechs are an emerging industry which is tackling the development of technologies designed to enhance traditional financial activities. It also tends to replace the sluggish, traditional methods in the financial environment. More than 1,000 fintech operations were completed in Q4 2018, which were worth nearly $ 40 billion. The chances of growth in the fintech industry are also very high in the coming years.
While the growth of fintechs has become very obvious, here are the three big trends that fintechs will produce in 2019.
1. Mobile and digital banking are becoming more dominant
In First World countries, a significant proportion of the population relies heavily on their smartphones when it comes to doing a variety of tasks, including banking. The combination of Internet and modern finance technologies has completely changed how people did their banking 15-20 years ago. Today, only a few individuals go to a bank branch to do their money transactions. Between 2019 and 2022, we will see an extraordinary growth of 121 percent in mobile banking transactions. 88 percent of all banking transactions will be done via cell phones.
For 2019, the use of digital banking will expand and there will be an increase in the number of banks with online tool and the size of fully digitized banks. The use of mobile and digital banking not only benefits the customer, but also the bank. By using the technology, customers can enjoy faster transactions, 24/7 access, and highly efficient services. On the other hand, the bank has the advantage of lower transaction costs.
2. Variety of fintechs
Fintech is usually associated with the development of blockchain technologies that are mostly associated with cryptocurrencies. However, last year the misconception that fintechs are only connected with digital currencies was elucidated.
Matthew Ledvina, Managing Director of Aerium Strategies in London is well aware of the fintech trends that will emerge in 2019. Ledvina wants financial technologies to be used to make financial transactions safer and faster.
Matthew Ledvina said on LinkedIn, “In addition, in 2019 fintechs will experience an expansion of their scope in various industries, including health and manufacturing. As a result, more fintech products and services will be found in other areas, such as blockchain and cryptocurrency.”
3. Increased use of Artificial Intelligence
Another trend that will appear in 2019 is the increase in the adoption and use of AI technologies in the financial sector. The promising performance of AI technologies has already led many financial institutions to use them to do some of their business. In addition, many other companies confirm that they will include AI technologies in their business framework next year. According to various sources, 10 to 25 percent of all banking transactions will be done by machines in the next few years. In addition, 2019 could also result in an expansion of the development of Regtech or Regulatory Technology, which will improve the regulatory framework for both investors and banks.
Also published on Medium.