Riding on the wave of Fintech Application Development, Financial services industry is going through an innovative and evolutionary phase. Fintech applications have transformed the consumer experience. Right from ATMs (Automated Teller Machine) and swipe machines to online and mobile banking, mobile wallets, automated bill payments applications; Fintech applications have enhanced the banking and payments experience of consumers. Along with the increased convenience and comfort of carrying out financial activities, Fintech solutions also streamline the process and reduce costs.
Fintech application development companies have come a long way when it comes to developing a secure Fintech application and with enhanced security and keen interest from all the sectors; today Fintech is disrupting the Financial industry.
Here we enlist some of the best and major financial services; which are reshaping the due to Fintech applications.
Billing and Payments Applications/Software:
In earlier years; credit card companies, major banks, and huge financial giants dominated and controlled payments & transactions. But, the introduction of digital payments/billing applications have shifted the entire scenario and had shaken the control of payments by the major players. Digital payments have converted the traditional cash-based operations into the cashless ones with utmost convenience and accessibility. As per Statista, digital payments transaction value around the world amounts to US$3,952,706m in 2019. Companies that provide payment solutions utilize new tech solutions such as webcam, Blockchain, fingerprint, retina scan etc. to endow with consumers with streamlined POS processing, and better mobile based interface to deliver better consumer engagement.
The Digital Payments/Billing solutions have two major sectors
- B2B payments (& cross border payments)
Bloomberg report of 2016 illustrates that the B2B and cross border payments has amounted to $150 trillion then and this suggests that it must have multiplied by a huge amount by now. While security, accuracy, and flexibility has been a huge challenge to B2B payments and crosses border transactions; there are technological solutions that assist businesses in achieving secured transactions and payments. Some of these tech platforms include-
- Customized & private Blockchain platforms for real-time transactions with the most security & transparency.
- E-invoice platforms for faster payment approvals and processing.
- Payment management platforms that offer consumers to choose from a bunch of payment methods or wallets.
- Mobile B2B platforms for faster payments and enhanced data management.
One of the best examples of successful B2B payments or cross border payment solutions is Paypal, Payfirma, Wepay etc.
- Mobile Payments
With mobile wallets such as Apple Pay, Samsung Pay, Google Wallet etc; more and more users are preferring to use mobile wallets to initiate payments instead of their credit cards. Though there have been concerns regarding security while using mobile payments but biometrics and NFC technology has helped in alleviating these concerns.
Banking institutions offer “banking as a service” applications for their consumers to perform banking activities online. Leveraging technological innovations such as Artificial Intelligence, biometrics, voice and face recognition, online banking improves customer engagement. Acknowledging the digital mode, online banking is extremely cost-effective. One of the digital-only bank is Atom Bank (with only digital mode and no branches). The reason for digital bank being cost effective is that it does not attract cost of having physical premises and deliver convenience to its customers. Since this branchless concept is different from other banking scenarios, it significantly reduces the cost.
Mobile Banking Applications
With many industries venturing into digital modes/platforms for their services, financial sector is not left behind. We live in a time now where we extremely hate standing in queue at banks for our transactions and deposits. In fact, banks too are quick to adapt to technology similar to its customers. Mobile banking applications offer all banking operations at your fingertips with secured logins.
Money Remittance/ Money Transfer
When the word money remittance comes, we recognize names such as Transferwise, TransferGo, WorldRemit etc. These companies allow user to send money to more than 100 countries and the receivers can get the amount via bank deposit, cash pick up counters, mobile money or at times even delivery. Money remittance/transfer solutions makes the process less time consuming, less expensive and in fact it does not even ask for actually sending funds abroad. It is all taken care by peer-to-peer (P2P) money transfer platform. P2P is one of the best and developing Fintech trends to invest into. P2P platform links digital wallet of two individuals looking to exchange money. P2P platforms/applications come in three different types:
- Standalone platforms (which does not rely on other financial organisations to conduct a transaction). PayPal is a standalone P2P application.
- Bank Centric P2P applications (with financial organisation as an intermediary for transactions).
Other than P2P money transfer platforms, P2P lending is another key direction in fintech application development. P2P lending is towards speeding and automating the loan request & process with reduced costs. Lending platforms fast-track the loan approval time, receives money from the borrower and streamlines the entire process.
The most striking feature of P2P lending applications is that it uses machine learning to understand and spot borrowers who do not deserve loan based on their credit score. Intelligent algorithms at the backend of system predicts creditworthiness of a customer.
P2P lending applications takes care of prospect sourcing, burrower application, credit underwriting and monitoring, disbursement, collection and recovery.
Personal Finance Management Applications
It has never been easy to manage your finance before than now with the personal finance management or money management applications available in the market. Whether it is bill payment, shared expenses, managing subscriptions amount, debt payoffs or any other wealth management functions; PFM applications are at your fingertips. These applications allow user to pull all of the personal money accounts together and lists personal finances in form of data visualisation, categorization, and spending habits.
Robo-Advisors are the latest advisory services in the market for personal finance management which is automated and runs on algorithms suggesting about asset management. Betterment LLC is one such robo-advisory based personal finance management & asset management company.
CB Insights report $1bn funding in Insurance Technology Sector. Insurance Fintech Applications are a big bonus to the insurance sector as the analytics and technology can utilize data to determine personalised offers and dynamic prices for specific customers. The Insurtech apps are even developed to analyse customer patterns and based on this data, custom insurance packages are created. For example, for a person looking for car insurance; the application would evaluate driving habits and based on the same suggest payment strategy. Also, insurtech applications allow to choose from best insurance policies for each customer.
To Move Forward
The above-mentioned sectors are some of the best performing areas of financial services and they have been changed a lot due to rapid increase of Fintech application development; some have matured very well, and some are at a growing stage of performance. Investment in Fintech sector is going reap good results in future. Though with more technology in use there is a need of enhanced security precautions, as Fintech application developer once must follow best practices to ensure the security in Fintech apps. But at the end it is safe to say that Fintech is set to increase by leaps & bounds in the coming years.