Technology is transforming people’s lives and has impacted different sectors of the economy, including the financial system. In this sector, specifically, technology has played an important role in transforming relations with users and in the progressive disappearance of cash.
The use of new technologies in the financial system demonstrates that this progress is already a reality. These are the main digital trends that are modifying the financial sector:
Big data and analytics:
A large amount of information, the speed with which it arrives, and the complexity and diversity have given rise to the term Big Data. The important thing about Big Data is the collection of all this information and what is done with it. Today, financial institutions use Big Data and the analysis that comes out of this information to make transcendental decisions for companies.
Virtual banking:
Large banks have leaped into the digital world, creating platforms that allow transactions, payments, purchases, and paperwork at any time and from a mobile device. The Financial Superintendence affirmed that in 2018, more money was moved in digital financial services than in bank offices for the first time in Colombia. More than 6 billion operations were recorded through digital channels.
Blockchain:
The Blockchain, or blockchain, is a technology that structures data and encrypts information to secure digital money, facilitates information retrieval, stores files, among other functions. At first, it was born to protect virtual currencies. However, the financial system is being obliged to incorporate this technology into its operations, facilitating negotiations, collaboration, and trust between the different actors.
Artificial intelligence:
Artificial intelligence is responsible for designing tools that emulate the physical and reasoning capabilities of the human being. These tools recreate human procedures, such as learning and reasoning. One of the uses that the financial sector gives to artificial intelligence aims to personalize the services of customers.
Cognitive technology:
Artificial intelligence helps financial service businesses in covering all their diverse aspects. It can best and helpful cases in the industry. Financial businesses already have high computing and cognitive abilities. They manage risks, identify data patterns, and detect fraud with the help of artificial intelligence. In this way, they make decisions with the least human intervention. Also, AI helps customers perform budget analysis, get a saving suggestion, realize the best mobile banking experiences and digital payment.
Conversational chatbots
Chatbots were useful technology but lost their value as they can’t deliver experiences like humans. The integration of AI in Chatbots rebuilt their charm and usefulness. By the end of 2020, AI-powered Chatbots can handle 85% of interactions among businesses and customers. Financial services businesses use conventional AI solutions to send humanized experiences to clients. Database and current interactions help in growing and learning AI-based chatbots. In this way, financial service providers bespoke replies to client queries, perform beyond expectations and give relevant suggestions.
Online perils and financial crimes
Complex and sophisticated financial crimes are unsafe from traditional prevention techniques. That’s why financial companies need advanced technologies for strict protection. Analytics and Artificial intelligence are best to improve detected fraud and threat visibility effectively. Eight out of ten financial service providers believe that embracing new security-related technologies is faster than the previous ones. American banking sectors can lose their $350 value due to cybercrimes in the next five years.
Cloud computing
Mobile banking meets all demands, online insurance transactions are going on, and tech-savvy clients are fond of digital wallets. Financial service providers got access to such proceedings. Now, financial businesses can get all of these facilities by cloud computing technology seamlessly.
The digital-powered sharing economy never sleeps as their clients want to connect smart devices, communicate, and 24 hours transactions. That’s why cloud computing encourages mobility in a true sense. As financial businesses have many expectations from cloud computing technology, it helps them keep up with the digital-born client pace. It has instant access to data and offers on-demand computer resource availability without direct management via the user.
These trends demonstrate the change the financial system is experiencing. The new digital generations are increasingly visiting bank offices. The step towards digital is a reality, and the financial system is moving towards the virtual world.
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