We spoke with Shamayun Miah, he has been in the technology industry for 20 years, helping organizations move to digital. Here is what we have learned from his recent experience with Fintech and Banking.
As banking technologies have improved and we have found ourselves moving away from traditional banking services and towards new financial technologies, questions about the future of banking arise. Fintech, which stands for financial technology is at its core a direct result of the modern need for better ways to manage money and maximize its potential. In many ways, new Fintech is exciting for users as it removes barriers to entry and makes financial services accessible and in some cases, more understandable. By contrast to banks, which were created from a need for credit and lending services, Fintech was created from a need for modern solutions, that made money easily accessible, as such apps and services in the industry have found themselves wide support from the general public.
What makes Fintech so successful is the fact that Fintech companies have managed to use recent innovations so as to better improve their product. They use cloud services to build their platforms and are often powered by Automation, Data, and Artificial Intelligence (AI). This usage of technological services allows them to enhance customers’ experience and to create personalized and highly customizable banking opportunities.
However, all this innovation means that customers who have turned their attention to Fintech services and have been employing them for years are constantly looking for more upgrades and apps that are perfectly designed and highly intuitive. The need for more services and perks also means that Fintech companies need to keep building on their highly functional apps and services if they want to sustain the customer base that they have gained.
While Fintech companies have so far managed to sustain their levels of growth, traditional banking services have also become part of the race. Traditional banking services have started employing some of the tools that were previously made available by Fintech companies in an effort to remain relevant. The fact that big banking corporations are big and established names means that customers are much more likely to rely on them since they have had years to build trust. More importantly, banks have one major advantage and that is the fact that they are serving the SME lending market and customers. This is something that Fintech companies do not generally have access to as of yet. With all that being said, established banks still have a lot of work in the field of technology if they want to be able to compete with the Fintech industry in the long run.
Traditional Banking Innovations and Fintech
So much of Fintech is about inclusion and the ability to make financial services easily accessible. This is something that major banking corporations have taken notice of. Most banks nowadays have allocated resources that have allowed them to create mobile applications and web services that allow their customers quick access to their banking service. Many of these apps are also using Artificial intelligence and data services to streamline procedures and to allow users greater control over their finances.
Many of these services and the use of web banking and mobile banking have been integral in allowing banking instructions to continue growing and to retain their place in the finance world.
While there are many services that started from the Fintech world that have made their way into the banking world, there are others that have not quite made the leap. Fintech companies have developed innovative solutions that include alternative credit scoring, Peer-to-peer lending, and small-ticket loans. They have also delved into the world of insurances by offering alternative insurance underwriting. These innovations have made them more inclusive and for many people, they have become the go-to place for all of their banking, finances, travel, and insurance needs.
Both the banking world and the Fintech world have given one another a lot of innovative tools and have challenged financial institutions to create systems that are more widely available. While in the past some may have expected that traditional banking would become obsolete, banks appear to have been able to adapt and use their resources so as to create further innovations and systems that allow their customers to use their bank accounts in new ways. Still, the world is ever-changing and with the current rate of growth, it would be interesting to see where banks and Fintech companies will be within the next decade.
Shamayun Miah is also the author of;