2020 being a consequential year for the fintech industries, has subsequently shown the dependence of the digital world a whole lot more than any previous year as the major part of the world got swept away from the pandemic from business to households and consumers to service providers making 2021 an year of crucial evolution of the flourishing fintech industries.
The firm Plaid’s survey, more than 2000 US citizens that had jointly conducted with the Harris Poll reported that 59 percent of Americans used the fintech applications for their money management and other financial transactions more than before COVID-19. Not just that according to 69 percent of the citizens, fintect acted as a ‘financial lifeline’ during the crisis and 73 percent believed the fintech to be the new normal.
The financial sector needs to up their game as there is not only an increased demand for the services and solutions of financial technology but also a need to accelerate the developments of new solutions in order to make this new normal a much more success in the coming years.
Despite the pandemic-related crisis fintech sectors in the North American and European markets should have a resilient result in the next year and both the geographical regions are to have significant operation head-wings as known by the Fitch ratings’ outlook.
Digital banking, Digital currencies, E commerce, contactless payments, Advances in AI are few of the features likely to be prominent during the current year.
With the people confined to their homes there was a plummeting demand to visit Brick-and-mortar establishments and the important advancements made in Artificial intelligence, biometrics, open banking, cyber security system, digital banking made it possible for them to access a and pay heed to a variety of financial needs and complete other important tasks with just a click on their smart devices. As there is an incline in digital banking there was a concurrent recline in paper based banking making the shift towards a paperless world as the customers became comfortable in communicating with their banks through mobile banking.
Crypto currency has seen resurgence of interest after having two years of sedate activity, Bitcoin breaking the all-time records in a fashion. Great proportion of institutional investors are holding Bitcoin and other crypto-currencies as their long term investments in the market. As such, investor interest in crypto currency space has grown in 2020 providing a platform for make successful decentralized finance (DeFi) projects. Novogratz predicts that the price of Bitcoin may reach $60,000 by the end of 2021. The legitimacy of crypto-currency will nothing but grow more in 2021 as its clearly being exhibited not only by institutions but also by some of the biggest monetary authorities.
Some countries are expected to be experiencing phenomenal growth in e-commerce over the coming years, digitization of retail services will explode. It is up to each country to ensure that they seize the opportunity the pandemic has brought to digitalize as the world moves in response to recovery.
From being an optional capability to becoming an essential payment service contactless digital payment has now evolved. This trend help companies like PayPal, Apple Pay and Square that offers contactless payments.
Coming to AI, it is most significant single technology class of all. Whether its chatbots addressing queries of the consumers, fraud preventions, authenticity verification of KYC documents, analytics for engineers analyzing large volumes of data, the fintechs will continue to use AI more than ever as its potential keeps growing significantly. Further evolving into cognitive process automation, AI systems will perform even more complex automaton processes.