5 Technologies That Will Shape the Future of Fintech
How will the world of finance look in next 10 – 20 years?
Though it’s hard to predict the future, it’s pretty easy to know what technologies will play a big role in the future of fintech.
Here are Five Fintech technologies that are shaping the industry now and will continue to be influential in the future.
1) The rise of mobile payments
Mobile payments have been on a steady rise over the past few years. In 2013, one in five Americans owned a smartphone and 22% used their phone to make a retail purchase in stores.
The demand for electronic payments is continuing to grow as people grow tired of dealing with cash, checks and credit cards. Not only are these devices convenient, but they also offer improved security over traditional forms of payment.
With the increase in demand comes an increase in innovation and new technologies that will shape this industry into what we know it to be today. UPI payments and Apple Pay are one of the most popular mobile payment methods available right now.
2) The growth of peer-to-peer payments
In the past, sending money to friends and family across borders was time-consuming and expensive. Now, with services like PayPal and Venmo, sending money is quick, easy and free. This year alone there have been over $25 billion worth of peer-to-peer payments made using Venmo.
The P2P payment market is estimated to grow at a CAGR of 17.3% from 2021 to 2030. Peer-to-peer payments are just one example of how technology has changed the future for fintech.
3) The rise of artificial intelligence in financial services
Artificial intelligence, or AI, is a type of technology that has been around for a while now but is starting to take off in a big way.
The McKinsey Global Institute estimates that AI will contribute up to $1.2 trillion annually to the global economy by 2030 and could add about 50% more labor productivity growth than what we have seen since 2010.
It’s not just about robots looking for work, though; AI is being used in many different ways to create efficiencies within financial services organizations.
4) The growth of blockchain technology
Blockchain is a decentralized and public ledger where transactions made in bitcoin or another cryptocurrency are recorded chronologically and publicly. A key feature of blockchain is that it does not rely on a central authority to verify the transaction.
Rather, all parties in the network can independently verify transactions because each node shares information about new transactions with other nodes to ensure that everyone has the most up-to-date version.
This means that people don’t need to trust their money with financial institutions like banks and credit card companies, but rather can keep it themselves or put it into an account on a site they do trust.
5) The rise of digital currencies
The rise of digital currencies is one of the most significant developments in recent years. The advent and adoption of cryptocurrencies has ushered in a new era for finance, economics and society at large.
Bitcoin, which was conceptualized in 2008 by an anonymous individual going by the alias Satoshi Nakamoto, is one example that has captivated financial markets around the world.
In 2017, Bitcoin achieved an all-time high market capitalization exceeding $300 billion.
By 2023 there can be seen some rise in digital currency world.
Disclaimer: The information provided in this article is solely the author’s opinion and not investment advice – it is provided for educational purposes only. Do conduct your own research and reach out to financial advisors before making any investment decisions.