During the pandemic, the fintech space has undergone some radical shifts from the point of obscurity and retard to the accelerated recovery and significant digital transformation.
Businesses and individuals were to quickly adapt to the new reality and find leading-edge solutions and strategies to retain their customers and keep up.
The main hurdle in the face of the pandemic led to more remote services, swapping conventional systems to digital platforms, and developing personalized user experiences.
Although some major changes have already occurred, and some are being streamlined and rationalized, the reconfiguring mechanism continues to make the fintech industry evolve towards building an overall smart future. Based on the latest research, some brightest minds predict that 2022 is expected to contribute a lot to the ongoing transformation of the digital banking landscape. Therefore, we decided to consider the most credible trends, so keep reading.
The Power of Data Analytics
Numerous vendors long ago started utilizing the concept of collecting data to improve their sales performance. But every business that functions under the umbrella of fast-transforming financial services has little room for errors and guessing games. Therefore, accurate insights and precise real-time data lie at the heart of the industry.
However, with an almost unlimited volume of structured and unstructured information generated every day and the constant growth of its complexity, the financial sector still finds itself in need of a complex, multilayered approach to data analytics in order to instantly respond to any unexpected fluctuations and deliver a more tailored customer offer.
Advanced Data Analytics Capabilities
The new approach has already resulted in deploying innovative AI and Big Data solutions based on complex algorithms and machine learning for 24/7 market monitoring.
Better insights produced by AI turned out to be quite beneficial, as they provided a sharper understanding of how the consumers operate and what they want. Additionally, such data analytics has already enabled flexibility and freedom to focus on other significant aspects. And even though such powerful tools still augment human decisions, soon they may exclude human supervision at all.
However, fintech’s success with AI analytics in 2022 requires a more integrated approach capable of managing the petabytes of data. And the use of data fabrics will be one of the most state-of-the-art solutions to overall data management.
Smart data fabrics embed a broad range of analytics capabilities, including data exploration, business intelligence, and natural language processing, making it faster and easier for businesses to obtain new insights and predictive schemes.
The smart data fabric also has the crucial ability to cope with surges in data volumes, presenting information in a simplified and streamlined architecture.
Some Other Ways Analytics May Help Fintech in 2022
Additionally, smart financial data analytics offers new opportunities for risk management and fraud detection. The combination of various metrics such as device identification, behavior, or activity may allow AI to efficiently detect suspicious models that indicate fraud and suggest a better risk management solution to maximize business outcomes.
Another significant aspect that is worth mentioning in connection with analytics is the speed of service. 2022 is expected to contribute a lot to instant responses on customers’ inquiries or banking status. Alongside this, fintech engineers promise better security options, including voice recognition and some other top-notch cyber security solutions.
Channels for the Delivery of Banking Services
The second thing that will likely have a significant impact on the fintech environment in 2022 is the further evolution of the digital distribution channels that are already radically changing customer interaction.
Increased Connectivity and New Banking Format
Since the Internet has allowed to rapidly transfer information and interact remotely both between businesses and directly to the consumer, it has become possible to have an expanded access to direct delivery channels such as Internet banking, mobile banking, digital banking platforms and deliver high-quality services with the aspiration of boosting profitability and diminishing operating costs.
Indeed, digital banking was widely utilized before the pandemic, but the trend will become even more expedited in the coming year. As a result of several lockdowns, the use of digital banking services rocketed, and with the already exponential development of the digital context, traditional banks may struggle to operate and compete if using outdated solutions. Therefore, an overwhelming amount of transactions in 2022 is expected to flow through channels owned not by banks but third parties and numerous fintech companies that will provide responsive real-time banking services with all the essential features customers need.
Existing Infrastructure Development
Does that mean that 2022 will be dominated by the players who offer digital-only formats? Not quite so. Despite the increasing influence of digital space, many customers still value the ability to have a flawless experience across many channels available to them, including traditional.
However, that does not mean that bank branches still may keep up by using their conventional models or offering a wide range of channels. Therefore, to recognize the demand for an integrated customer service approach and meet new requirements, in 2022, banks are expected to adopt new strategies regarding further development and traditional channels redesign. And even though that may seem quite formidable to quickly transform the existing system and require enormous investments, only those able to meet the challenge will reap the benefits.
Self-Service: A Temporary Measure or a Long-Term Trend?
The Covid-19 crisis has made significant adjustments in consumers’ behavior. With the help of the latest banking achievements, it has become possible for people to carry out previously unavailable digital self-service jobs like loan origination.
Moreover, with intuitive self-service digital banking solutions that provide an effortless and quick user-friendly experience, numerous users have started to rely even more on digital banking channels.
Indeed, self-service inclinations are no longer limited by everyday activities, such as transferring money and checking banking records online. And the tendency is that new hi-tech implementations lead to replacing human assistance with chatbots, enabled by artificial intelligence.
They can already resolve some of the challenges and help banks improve customer service quality. Due to machine learning, chatbots gradually expand their capabilities, act incredibly human-like, answer questions in real-time, and simulate online conversations with people via different channels 24/7.
Moreover, an advanced chatbot can support customers in daily banking tasks (like providing account details), collect marketing leads, or manage cross-selling activities.
Therefore, 2022 is likely to become a transition year to the full-blown self-service technologies that will evidently remain as a long-term trend. Of course, there is a long way to go, but the designing and testing processes are in full swing, and soon we may use real-time ID and selfie verification or eSignatures on a regular basis with no need for human assistance.
Anyway, no matter how superior long-term plans are, in the short term, any digital process should be designed to go beyond filling the form and provide a smooth customer journey across channels.
The Bottom Line
To sum it up, it’s still important to highlight that despite the upcoming advances in fintech, 2022 is not going to offer one-size-fits-all solutions in key areas, especially in data analytics. There are still several obstacles the banking and finance sector will continue to face, such as a lack of qualified experts and proper data regulation.
Nevertheless, some changes, in turn, will make significant adjustments in the existing financial space. Banks are expected to accelerate and scale their current infrastructure programs to extend digital functionality, its realization, and personalization – which will often be in collaboration with innovative fintech players. Besides, banks will have to do their best to develop an entirely new strategy to target individual customers and offer them the right products and services with the right frequency through the right platforms. And even though customers will likely use more self-service or remote service via an online chatbot or digital support manager (again, the already-mentioned AI solution), any hot innovation can dramatically change the rules of the game.