2020 will bring new technology and expand existing technology that is already being implemented in the financial services sector. Some of the main areas of financial services technology to look out for in 2020 include the expanding use of artificial intelligence (AI), the increased use of data analytics in decision making, and the use of blockchains for security. Other trends include a greater emphasis on digital banking and automating tasks to cut costs and improve efficiencies. We discuss these financial services technology trends in greater detail below.
The use of AI has been around for a while now, and the financial services sector has already begun to embrace it. Expect the use of artificial intelligence to grow in areas such as fraud detection and risk assessment. Another interesting use of AI for the future in financial services is using AI to provide real-time investment advice. Chatbots are another example of AI that has been used and will probably be increasingly used by banks as they become more digital in the future.
The use of data analytics is expected to grow in the financial services sector, as well. It can be used to gather information on bank customers and improve the banking experience for them both in the branches and on the web and phone. Data analytics can also be used to aid in decision making, such as whether to approve loans and credit cards to customers. Security and product offerings can also be enhanced through the use of data analytics. Expect data analytics to see tremendous growth in the financial services sector, along with AI.
Blockchains are a new technology that is primarily focused on improving security. This new technology should be adopted by banks to help reassure customers that their transactions, as well as contracts, are secure. Blockchain can also help eliminate intermediary fees and middlemen that transfer funds from one bank account to another.
The other trends in the financial services technology sector are digitization and automation. Digitization refers to the growing demands of online and mobile banking. Some new banks and financial service companies offer their services exclusively on the web and smartphones. Automation in financial services refers to the use of robots and software to automate tasks such as transaction processing and data entry. The use of automation can save banks money and free up employee time so that they can focus on more complex tasks. Expect both digitization and automation to be widely adopted and implemented by banks in the future.