The financial industry has always been at the forefront of innovation, evolving at a never-before seen rate in the last few decades. Fintech, or financial technology, has been a game-changer in the financial industry, introducing groundbreaking technology and providing better service to customers. Today, we’ll take a closer look at some of the most prominent fintech trends you need to look out for in 2023.
Artificial Intelligence, Machine Learning, and Fintech
AI and machine learning are among the most significant fintech trends that are changing the financial industry. Both AI and ML are transforming the way financial service companies operate, making banking faster, more efficient, and more accurate. These technologies are being used to develop chatbots and virtual assistants that can help customers with their queries and provide personalized advice, freeing up consultants’ time. Companies make use of language models like ChatGPT, trained by OpenAI, to answer customers’ questions and provide valuable insights.
Companies need to be aware of both opportunities and challenges of ChatGPT for financial services. While it can definitely be a useful tool in improving customer service (and not only), language models are prone to generating false information, not based on actual data or knowledge, and businesses need to keep in mind that regulation regarding AI use is rapidly changing, so don’t let any new changes take you by surprise.
Low-code platforms for financial services
Another fintech trend that is gaining traction is a low-code approach to developing fintech platforms. Low-code platforms allow developers and regular users to create applications using a simple visual interface, usually with drag-and-drop components in place of writing code.
This approach can significantly reduce the time and resources required to develop new applications, and it can help financial services companies launch new products and services in record time.
Efficient data processing with cloud computing
With tremendous amounts of data that continue to grow with every day, the fintech industry is constantly in need of faster and more efficient processing. Cloud computing allows financial services companies to store and access data and applications online instead of on-premise, significantly reducing costs and improving scalability.
What’s more, cloud computing can also enhance data security by providing robust backup and disaster recovery capabilities.
Taking advantage of embedded finance
As 2023 is gaining momentum, the financial technology industry is looking towards embedded finance as the next big thing. Embedded finance involves integrating financial services into non-financial applications and platforms – for example, an e-commerce platform could offer a range of financial services, such as loans or insurance. This approach can significantly enhance the customer experience and provide an additional revenue stream for financial companies.
With embedded finance, users don’t have to switch between apps to access financial services, allowing customers to, for example, make their purchase now and access financing services to pay for the product over time. According to research performed by McKinsey & Company, the market for embedded finance is expected to double in size over the next two to four years.
What is 2023 looking like for the financial industry?
Fintech is revolutionizing financial services again – which is only to be expected, looking at the last few years. AI and machine learning are improving efficiency and accuracy in financial services, and low-code platforms are reducing development costs and time and making app development more approachable. Cloud computing is also improving scalability and data security for financial services companies, making large-scale solutions easily accessible without heavily investing in infrastructure.
Finally, embedded finance is breaking new ground, creating reliable revenue streams, enhancing customer experience, and helping financial companies capitalize on valuable leads in crucial moments. Companies that embrace these trends will definitely be well-positioned to succeed in the coming years, and, with the help of technologies like ChatGPT, the possibilities for growth are endless.
Keep your eyes open for new amazing technologies as 2023 continues – we might be in for a couple more surprises yet!