With competition getting tougher, it’s become important to keep track of the emerging technology trends. Check out these seven technology trends for the banking industry that you can maximize even beyond 2020.
1. Artificial Intelligence
Artificial Intelligence (AI) in computer science is defined as machine-demonstrated intelligence. It allows the performance of tasks that commonly require human intelligence such as:
- Language translation
- Visual perception
- Speech recognition
The banking industry uses AI to meet people’s demand of having a safer, more convenient way of managing their money. As a result, bank customers gain a better experience.
For instance, banks use AI to enable mobile banking, which provides customers a faster way of conducting financial transactions using only their tablets or smartphones. Some of the common mobile banking services include:
- Monitoring of account history
- Fund transfers between linked accounts
- Portfolio management
- Checking of credit requests status
In addition to mobile banking, AI can also help banking institutions streamline their customer service, improve security, detect and prevent fraud. It is also instrumental in lending decisions and risk management.
2. Big Data
The banking industry accommodates huge volumes of data every day, making it hard to get actionable insights that can help push business growth. This is where Big Data plays a crucial role.
Big Data refers to the large volume of both structured and unstructured data that makes processing difficult, especially when using traditional software and database techniques. Large banking data like credit card transactions, money transfer, and ATM withdrawals are sourced from emails, applications, servers, mobile devices, and databases.
Big Data as technology helps companies improve their operations by giving them valuable information. Here’s a breakdown of its benefits:
- Analysis of customers’ purchasing behavior
- Better marketing
- Sales management
- Fraud detection
- Product cross-selling
- Customer feedback analysis
- Streamlining of internal processes
- Identifying the latest market trends
With these useful insights, companies can enhance their operations, increase their revenues, retain their customers, and remain competitive.
Blockchain refers to the list of records that are linked using cryptography. It is known for cryptocurrencies such as Bitcoin, Litecoin, and Ethereum.
This technology trend makes transaction monitoring more secure and verifiable. Additionally, blockchain can help disrupt the banking industry through:
- Enhanced security
- Cost savings
- Improved customer experience
Since blockchains provide ease of use and security, it can be useful for promoting transparency, especially for currency exchange and payments. It houses profile details and real-time payment information on multiple blockchain servers, protecting customers’ personal and financial data.
Moreover, blockchain does away with the need for third parties in the credit and loan system, making interest rate reduction and money borrowing more secure. It also helps prevent cyberattacks and detect fraud.
It’s easy to see why chatbots are among the technology trends for the banking industry — today, customers have become too impatient to wait for their queries to get resolved. They want quick answers and fast fixes for their issues.
In the banking sector, chatbots are a gem because they make this possible. Many finance companies are using chatbots to meet their customers’ ever-changing needs and demands.
Users are no longer relying on traditional two-way communication methods such as phone calls and emails. Chatbots now take the spotlight when it comes to customer service interactions.
This technology trend paves the way for conversational banking, allowing banks to provide their customers with a personalized experience. Chatbots help meet customers’ expectations by resolving simple queries, although advanced bots can do more.
- Advanced chatbots can help:
- Discover fraudulent activities
- Assist in registration
- Provide financial tips
- Make smart conversations
Using this technology, banks can enhance their connection with their customers. Even better, banking bots help save costs by replacing human agents.
5. Cloud Computing
Cloud computing is also one of the technology trends for the banking industry. One of its core benefits is its ability to provide 24/7 customer service, helping financial institutions improve their processes and scale up faster.
This technology offers the following perks:
- Speed and agility
- Better task management
- Cost savings
With its pay-as-you-go pricing options, banking institutions can control their costs. It also makes cloud services easier to use for businesses and even individual customers.
This tech trend proves useful for the banking sector since it can promote safety, especially for common bank transactions like digital money transfers and online payments.
The banking industry is at risk of cyber-attacks and fraudulent activities since it deals with sensitive financial and personal information. Since it is impossible to prevent all cyber-attacks, security plays a major role in the banking sector.
Financial institutions need to have plans in case of a breach. so that damage can be reduced. It’s also best for banks to educate their customers on how they can avoid the risk of falling victim to cybercrimes.
7. Robotic Process Automation
Robotic Process Automation (RPA) refers to customer service bots that handle low-priority queries including those that involve payment and account balance. Since human agents no longer need to deal with such queries, they can focus on high-priority concerns and tasks.
Using this technology, banks can enjoy these benefits:
- Time management
- Improved productivity
- Reduced labor and operational costs
- Lower error rate
- Quicker decision making
While robotic innovations still have a long way to go, banking institutions need to know their benefits so they can reap their long-term AI outcomes. In a nutshell, RPAs make a great option for workflow automation, preventing repetitive tasks without the need for human intervention.
The banking industry experienced tremendous change over the years with the rise of new technologies. While people’s needs, demands, and expectations continue to evolve, such technologies help deliver enhanced customer experiences.
Today, banking is made easier and more convenient for customers, improving banks’ relationships with their clients. Simply put, the banking world should consider these technology trends moving forward to achieve their business goals.
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