Digital financial tools can help change your business for the better.
Learn how digital transformation can affect your business.
The financial services industry is one of the first industries that has fully embraced the digital world and speeding towards it in full speed. With the emerging financial services technology or Fintech available, the financial services industry is finding new ways to make spending, managing funds, and investing a lot more efficient and effective. With the rise of new applications and products such as PayPal, Venmo, and Apple Pay, consumers are transitioning towards digital currency and even digital investing, making the whole industry to rethink how it has to adapt to interact and satisfy the consumers’ needs.
According to a PwC report, 46% of consumers have skipped going to bank branches all together and are primary relying on their phones and applications. As digital behavior continues to grow and human interaction channels shrink, CFOs need to learn how to adapt in order to survive this new landscape. Here are some of the digital transformation trends that you need to consider in the financial industry.
Open Business Models Can Accelerate the Industry
One of the most important lessons we’ve learned in 2018 is that there needs to be a balance of openness and data connection in our digital community. By opening platforms to third parties through application programming interfaces or APIs, companies can leverage the power of data to collaborate with partners and develop new cloud-based applications and services. This can help accelerate the development of many new applications and products that are available in the industry.
Many of you may have heard of Bitcoins and its hype earlier this year. The hype was warranted because there are a lot of good reasons why Bitcoins have so much potential. Bitcoin is an online currency that can be sent and received by anyone in the world, relying on computers to control the transfer and creation of money without human intervention, which results in low costs, no government corruption, and super-fast transfer.
It utilizes “Blockchain” technology, which is essentially a giant open source digital ledger on which transactions are listed. The open source allows anyone to see every transaction so nobody can lie about where they sent money. There’s no personal information on the blockchain but if somebody knows your “wallet” address, they can track where you have sent your money similar to how banks can track your spending with your bank account information. This technology has a lot of potential to improve the financial industry in ways including:
- Digital Identity Verification would make remembering passwords a thing of the past.
- Data Management; Ownership Rights, Audit Trails, Automation, Banking all have use cases.
After the financial crash in 2007 and the Great Recession, consumers have reconsidered how they should save their money, rather than keeping it in a traditional bank. Now that a decade has passed, emerging technology such as blockchain and fintech has yet to eliminate the need for banking, but improving it and making it safer. With so much data and information available, it is becoming more important for financial services companies to be responsible and keep it safe.
Digital transformation can help companies accomplish this and improve how we manage this data.