The huge advancement of the banking and financial sector through the cutting edge technologies has opened up new possibilities for the financial institutions, banks and the customers of the sector. More than 70% of banking customers in US now access banking and financial solutions through mobile banking and fintech apps.
The benefits of Augmented Reality for enjoying a remote experience of the physical store right through the mobile apps are already well known. In the similar way, connected devices and smarter data technologies are making transactions smarter, secure and swift for fintech app users.
Particularly, the connected device ecosystem pertaining to the Internet of Things (IoT), big data analytics powered by artificial intelligence (AI) and blockchain decentralised database systems completely revolutionised the fintech solutions.
Here throughout this post we are going to decipher the impact of these technologies on the fintech app development.
Big Data Analytics
Big Data refers to the large and exponentially growing volume of data across both Structured Data type, Unstructured Data type and Semi Structured Data type. This huge and exponentially growing digital data put under sophisticated analytics engine becomes the gold mine of relevant business insights that can be utilised by the companies for strategic decision making and detection of future trends.
No wonder, Big Data analytics has been embraced by industries across all niches for strategic decision making processes and to stay ahead of the competitive curve by grabbing the market trends in advance. The financial and banking sector players have also found the huge potential of Big Data analytics in opening up new business opportunities based on data driven insights.
As the Big Data analytics tools are evolving and getting sharper and more equipped over time with the emergence of Hadoop, Apache Spark/Storm, Ceph, Google Big Query and several other engines and tools, fintech apps continue to receive era defining advantages of these tools. Particularly the artificial intelligence (AI) technology coupled up with Big Data opened up new opportunities.
The combined power of AI and Big Data
Both AI and it’s subset technology, Machine Learning relies heavily on the consumption of data for churning out more precision driven insights for the businesses. This is where the volume, variety and veracity of the Big Data helps in feeding all types of data from diverse sources to ensure delivering precise data driven insights.
The field of predictive analytics emerged thanks to the powerful combination of Big Data analytics and AI technology helping to provide more relevant insights on the behaviour of the financial investors and banking customers. No wonder, world’s leading fintech apps are now using powerful predictive analytics powered by the combination of AI and Big Data.
There are many banks that already began leveraging Big Data and AI technology in their mobile apps. The Royal Bank of Canada has already incorporated Siri voice command virtual assistant with their iOS based mobile banking app called RBC Mobile. Instead of using biometrics, the banking users can just authenticate themselves through their voice footprint while using Siri for banking actions.
All the security concerns that are still there with such Big Data and iOS powered apps are slowly getting over as new and more sophisticated measures are coming up to utilise these technologies for preventing fraudulent accesses and data breaching efforts.
IoT (Internet of Things)
IoT basically refers to the internet connected ecosystem of devices, gadgets, appliances, vehicles, systems and sensors that can transmit data and allow user interactions for relevant tasks. These connected things in more ways than one revolutionised the way modern human beings react and interact with the gadgets and appliances and get things done for different purposes and contexts.
There are many instances of how IoT could really open up new potential for banking and fintech apps. For example, a connected security camera installed within a bank can detect any abnormalities in the customer behaviour or any potential security loopholes and can transmit the information in real time to the authorities.
Similarly, a connected beacon device by detecting the customer movement nearby a store can send notifications with custom limited period offers only to influence the customer’s decision to visit the store and make a purchase. In turn such smarter location specific marketing can also increase the transaction volume of the e-wallet or banking app.
Fintech apps and IoT devices
As far as the future of mobile banking and fintech apps is concerned, the increasing interaction between mobile apps and other sensors and devices are going to play the major role in pushing the smarter transactions. For instance, after arriving at your bank, instead of standing on the queue for simple advice the customers can complete several actions right through the mobile banking app including fulfilling the KYC (Know Your Customer) requirements.
The Bluetooth and internet connected Beacon transmitters that can easily connect mobile devices nearby can further make things easier for the bankers and financial institutions to target customers based on their specific locations. Thanks to the connected ecosystem of sensors and mobile banking, banking sector is increasingly heading towards smart banking devoid of leg work and manual activities.
Blockchain technology which for the first time was unveiled through a digital currency called Bitcoin represents another revolutionary facet for fintech apps and solutions. Blockchain is basically a decentralised database system that stores data into disintegrated blocks or nodes while allowing access based upon mutual authentication through encrypted security keys.
As of now, Blockchain is considered to be the most secure technology for database management across all sectors simply because, Blockchain runs on a protocol that registers every new change, data movement or transfer and efforts in tweaking data as separate data entries and this in the one hand creates optimum transparency for all the stakeholders actions and on the other hand completely makes it impossible to delete and tamper any data.
Blockchain for fintech apps
With such robust security features of Blockchain the technology is quietly likely to enjoy preference across all fintech and banking apps. Since every transaction is registered by Blockchain with a detailed timestamp and since the data is replicated across multiple nodes, banking data can be completely safeguarded from all hacking and data breaching attempts.
Thanks to Blockchain it is absolutely impossible to tamper with any of the data blocks just because there is no single data source and any efforts to change data in any block will be immediately discarded by other blocks while the effort to change the data will be registered for future reference.
With so robust security offered by the Blockchain for fintech apps, world’s leading banks and financial institutions such as DBS, ING, Visa and Standard Chartered are now using the technology for their fintech solutions. Apart from the never-before security benefits, Blockchain technology also ensures optimum data transparency, faster data transfer and lower cost of transactions.
From all the above points, it is quite clear that these cutting edge technologies are not just making the fintech solutions smarter, they are also creating actual values in terms of better data security, fast paced processing abilities, better utilisation of resources and lower cost of transactions. In the years to come, these tech advantages are going to be the part and parcel of the entire financial sector.
Author Name: Dhaval Sarvaiya
Bio: I am Dhaval Sarvaiya, one of the founders of Intelivita, one of the leading AR app development companies with offices in Canada and USA. I help Startups and Enterprises overcome their digital transformation and mobility challenges with the might of on-demand solutions powered by cutting-edge technology.