Business entities and financial service firms have a unique selling proposition. They offer a perfect combination of convenience and great customer value. Nearly 6.378 billion people are using smartphones and other modern technologies. By 2025, that number will rise to 7.33 billion. Companies and financial institutions need to be able to scale up to meet the demands of technological advances that are constantly changing.
FinTech is constantly innovating new technologies to help individuals find efficient online services that can be used quickly and accurately. Digital innovations have led to a multitude of new industries and services. These include cryptocurrencies, online banking and Insurtech as well as P2P trading and IDV services. Here are a few examples:
Online Banking and Financing Platforms
Multiple transactions are necessary for international business expansion and management. The internet and mobile technology have revolutionized the payments industry. Transactions are processed quickly and verified within seconds. Thanks to the ease-of-use interfaces of AI-powered systems, the transition from the traditional model to online operations has been smooth. Machine learning algorithms in the intelligence model for online solutions recognize suspicious patterns and flag suspicious transactions within seconds.
It can take time to request a loan from banks, and for it to be sanctioned. This requires extensive documentation verification and investigation. Even in digital age, it can be hectic and time-consuming. FinTech is a great alternative to funding seekers. Many money lending platforms have been created in the past years for potential employees and startups that require a loan amount in order to start their business and achieve short- and long-term goals. Based on the applicant’s documentation, the platform offers loans to the most needy. A few options are presented to the individual: different loan amounts and interest rates. The platform does not require any paperwork, and loans are approved in minutes. Some platforms don’t require any documentation. Loans can be approved with the help of a Bank Verification Number (BVN).
ID verification Industry
It is not new to digitally open an account or make online transactions. There are many KYC compliance issues that have been reported. These issues require new creative ways to validate an individual’s identity, and ensure risk-free customer onboarding. Standard Chartered was fined $1.1 Billion in April 2020 for not conducting adequate AML screening. Credit Sussie was also fined $700 million by authorities on Oct 21 for failing to comply with compliance requirements.
Every year, FinTech develops new technologies that enable banks and firms to authenticate beneficiaries’ IDs and reduce risk. Online biometric verification, facial recognition technology and video KYC are all options for verifying customers’ identities. NFC technology is also available to authenticate chip-based documents. There are many other ways to verify customers’ identities. Advanced solutions have a user-friendly interface. They don’t require separate installation and can be used in regular browsers thanks to seamless API integration.
Virtual currencies have revolutionized the financial industry. Virtual currencies make it easier to manage monetary funds. The best part is that the financial transaction occurs without the involvement or interference of any third party. This saves users a lot of time, effort and attention. It is a safe investment option that users can use to join different virtual currency platforms. It is predicted that cryptocurrency will become a global currency and that it will be used for the purchase and sale of commodities and other services in the future. It will be a widely accepted currency and a source of income for all who have invested.
Insurtech, the first FinTech technology to be introduced, was not well-received by insurance companies. However, over the past few years, many firms have been eager to provide capital to insurtech startups. This technology uses machine learning, artificial intelligence, social media accounts, and machine learning to gain new information. It can be used to create personalized policies that are more productive for individual customers. Insurtech provides customers with wearables, apps and claim processing tools. Automated processing enhances the operational efficiency of insurance companies. This allows you to reach new customers with the best pricing.
It can be beneficial in many cases. It can help a company designing home security systems to find out the number of houses in a particular area. This information is useful for insurance companies to market their products to potential customers.
Many apps offer KYC services for a temporary basis. A person may have borrowed a car from a friend for a day. To reduce the risk to the lender, the automobile can be insured.
Blockchain (P2P market)
Fintech technology offers people the opportunity to store their investments and funds in a decentralized ledger. Information is stored in various blocks and linked together. Trade-in networks eliminate the need to have intermediaries. The ledger tracks trades and the ownership of assets. Everyone is notified about trades and any changes to the information in the block. Because any change to the network’s information can disrupt the whole system, it is difficult to alter the information.
Fintech has been a key enabler for companies in the financial and corporate industries to remain relevant in an ever-changing business landscape. It also helps them become global leaders. Experts in the financial and payments industry are constantly observing customer habits and changing behavior to develop innovative technologies that make it easier for them. Technology enabled the development of online banking, virtual currencies and blockchain technology. Insurance, among other things, was also possible. The financial sector has been transformed by fintech innovations. It is expanding at a rapid pace and is expected that it will enhance the industry to a whole new level.