Investment Trends in Fintech Industry

Investment Trends in Fintech Industry

Latest Trends in Fintech Industry

Fintech, a neologism of ‘Financial technology’, typically refers to organizations that take the support of technology to deliver financial services to consumers or businesses. There are several driving forces for Fintech industry, like increased social connectivity of new generation, increasing demand of automated and user-friendly financial tools, etc. In a nutshell, fintech is used to help small and large businesses, consumers and bankers to arrange financial operations systematically.

Before we explore the hot fintech trends, it is imperative to discuss the past performance of this industry. Investment in Fintech was at record high in 2018 with an 18 percentraise in venture capital investment across the globe.

Artificial Intelligence: This technology has received huge appreciation in the financial industry. People can enhance the investment process through AI. Robo-advisory is the most popular example of AI application. It is a wealth management tool that offers automated algorithm financial planning to investors with minimum to moderate human intervention. Furthermore, AI assistance is also being used to manage banking operations. It helps investors in managing the portfolio and assist in investment decision making. Another noteworthy application of AI is Risk management whose main objective is to identify, analyse and manage the risk in real time and provide actionable decision to mitigate the risk.

Blockchain: Blockchain is a breakthrough technology; decentralized, disrupted, and a public ledger that enables businesses to re-think the way they work. With the help of blockchain, one can easily send, receive, store and trade digital currencies. This technology-based transaction system enhances the subsidiary, flexibility, and efficiency of the business by transferring currencies speedily and simplifying cross-broader payments. Utilizing blockchain allows greater trade accuracy, and quicker settlement process. One of the most prominent use of this technology is ‘smart-contracts’, it executes all commercial transactions and agreements automatically.

Cyber Security: As the size of digital data is increasing, so is the concern about “how to safeguard data”. Investment on cyber security applications like firewall, antivirus, and hybrid cloud protection, raised by about 13% in 2018. Many financial firms have been victims of cyber-attacks. In order to protect our systems from breaches, it is vital to use cyber security products.

Gamification: Many businesses are looking for new ways to improve engagement and increase profitability. This tool is being widely utilized by business owners to support their customers or to achieve their financial goals in an engaging and fun way. It is a game-style mechanics that makes customer service interactive and responsive. Loyalty programs, earning rewards and bonuses are some great examples of gamification.

It goes without saying that fintech is booming in the market, with AI being the flag-bearer for the investment decisions. To recapitulate, fintech is conquering the hearts of new generations and business owners.