Thu. Dec 3rd, 2020

Planet Compliance

Innovation & Regulation in Finance

Digital Banking Trends 2021: UX is the Fuel for Fintech Disruption

5 min read

As technology develops, the banking industry changes forever. There are unprecedented companies that have achieved outstanding results in the banking and fintech industry. The growing demand for digital banking services has led to the widespread adoption of many revolutionary technologies, like artificial intelligence and machine learning.

Digital Banking Trends 2021 UX is the Fuel for Fintech Disruption

As the industry changes, it becomes especially important to keep up with the latest digital payment trends so that you do not lag behind your competitors.

Digital Banking Trends of 2021

1.Blockchain:

Almost 48% of bank executives believe that new technologies such as blockchain and artificial intelligence (AI) will have the greatest impact on the banking sector. Blockchain promises to bring a global change in financial systems. It offers new technology and a new philosophy of decentralized money that focuses on eliminating centralized processes.

The blockchain ideology has so far led to the creation of various online peer-to-peer financing platforms that enable monetary negotiations to take place in a more decentralized way. It enables the existence of cryptocurrencies.

  1. Artificial Intelligence (AI):

AI brings changes in every sector of the financial services industry, including front, middle, and back offices. AI is already successful with the best customer service software using chatbots and other smart systems.

Financial institutions will be no exception, which will allow for faster transactions and provide convenience to customers as per their demand. With real-time complex rules and procedures, your-customer (KYC) systems, AI inspection, and risk-management can become very valuable in the middle office.

On the other hand machine learning in the back office can automatically power the simple credit underwriting model. If you are thinking of either starting a business or changing careers, AI is a smart choice.

  1. Digital-only Banks :

A digital-only bank is an app-based bank that does not need physical branches.  Automated processes and real-time updates are used for many services and customers are offered support via in-app chat. It is redefining the future of banking worldwide.

And they are growing in numbers and revenue as there is no need to spend a moment visiting any brick-and-mortar bank, no lines to test your patience, and no painful paperwork to deal with. The new financial reality is that we will soon have online global transfers, mobile wallets, branchless banking solutions, and AI financial support with no need for physical branches.

  1. Reg-tech:

The financial sector is a highly regulated sector and the FinTech revolution requires concurrent development of regulatory technology. These are new technology solutions that enhance and simplify the regulatory process.

Regtech emerged in response to the downward institutional demand resulting from the huge growth in compliance costs. Legislators, technology companies, and eminent financial actors will work together to launch new regulatory innovations, but these often require time to mature.

  1. Data Utilisation:

Data analysis enables banks to better understand their client’s needs and preferences. Banks no longer have to limit themselves to mere risk, demographic, and product ownership profiles. They can access psychographic and lifestyle data, purchase data, geolocation data, and information about channel preferences and use of social media.

Advanced analytics allows banks to use data to determine not only purchasing preferences but also when timing needs are anticipated. It also enables companies to customize communication with their audiences. The personalized approach can make marketing efforts much more effective.

However, customization requires not only knowing your clients but speaking their language as well. Consequently, international banking systems may also benefit from professional localization services such as The Word Point.

  1. Fully Mobile Banking:

The team of brick and mortar bodies is an institution of fintech disruption. In a constantly evolving world, we rarely have time to approve transactions and sign paperwork at our local branch. New financial products such as Revolut and N26 make this possible by ensuring better security.

This, in turn, allows for a better user experience that has nothing to do with the product interface. Instead, the goal is to make it easier for clients to access their finances and eliminate bureaucracy.

  1. Omni-channel Strategy:

Mobile channels are already dominating. If you’ve just started digitizing your bank, start with the responsive web for mobile services. You can provide the best possible experience to your customers by implementing an omnichannel banking solution that includes native solutions for major mobile platforms, responsive desktop service and WiRables, IoT, or even VR / AR solutions soon. It aims to make the same set of services available to customers on every channel, both digital and offline.

  1. Collaboration :

As the banking industry changes rapidly, it becomes very difficult for any institution to work on reform alone. By collaborating, banks can expand their platforms and products into new markets, talk to new customer segments, and expand. The most important thing when it comes to partnerships is flexibility.

To adapt to changes in the market, companies need to collaborate without renegotiating their relationships. Collaboration makes it possible to integrate seamlessly with existing products and systems. By partnering with each other, digital fintech software providers can ensure effective integration with credit unions and banks, reducing external and internal friction.

Conclusion:

The digital bank is not a novelty anymore. Many traditional banks have already launched their mobile application or online banking services. At the same time, digital financial services appear here and there, making digital banking mainstream.

While trends fluctuate, it is essential that we focus on optimizing our users’ experiences through design. For a digital product to be successful, it is important to keep in mind the uniqueness of your brand, customer expectations, and cutting-edge technology.

Author Bio:

Nikunj Gundaniya, Product manager Digipay.guru, one of the leading Digital wallet app development company.  He is a visionary leader whose flamboyant management style has given profitable results for the company. He believes in the mantra of giving 100% to his work.

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