Financial technology is a massive umbrella that covers the entire infrastructure that develops payment processing, modern digital payment rails, settling of capital market assets, and various other financial software applications. Financial institutions require a combination of different hardware and software applications to move ahead and abolish the outdated process gaps that existed for years.
The inner workings of the fintech industry rely a lot on the innovation of different software applications so that new entrepreneurs can make the most of them and improve their business activities. According to experts, the following trends will rule the fin-tech industry in the future:
1) Artificial intelligence
AI is already making the headlines in almost every industry. With robots tuned to come up with algorithms, they are reducing the accuracy issues involved with humans. For example, predicting the crypto market was almost impossible a few years back. But, with the introduction of trading software and indicators that are powered by artificial intelligence, investors can now play safely while investing. Those who have already used Bitcoin Code Review rave about the ability to check the forecast of the currencies before investing. With AI, the chances of developing highly practical tools to manage portfolio risks will improve.
2) Quantum computing
Quantum computers will soon become supercomputers, thanks to quantum phenomena like superposition and quantum entanglement. One of the reasons why this will become a crucial part of the fintech industry is its ability for faster data processing, better security, risk and performance modeling, and quick settlement of transactions. According to the Wired, some of the big financial players like Barclays and JP Morgan are using quantum tools from IBM for future practical applications. Although nothing is confirmed now, experts believe that this will grow to become one of the essential parts of the fintech industry.
3) Big tech
The financial sector will see the entrance of some of the massive tech firms in the world. Samsung Pay, Google Pay, and Apple Pay are already popular among millions of smartphone users. With Facebook also coming up with its own cryptocurrency, Libra, the trend will continue to shift towards social media platforms integrating more and more with eCommerce stores. This will allow the fintech industry to not only collaborate with the big tech firms but also create an opportunity for various social media websites to provide flexible payment methods so that they can dominate the online retail platform in the future.
4) Decentralized finance
The crypto and blockchain industry is relying on decentralized finance to ensure transaction security. Since it is based on open finance protocols, many projects like MakerDAO operating on Ethereum are up for decentralized lending that offers a variety of alternatives to the traditional financial institution. Decentralized finance is striving to provide more powerful and easily accessible financial products to a wide range of people that offer less censorship. Apart from blockchain-based companies, they are also trying to help non-blockchain companies too.
With the AI tools offering a promising future, new entrepreneurs will happily welcome open finance, especially when it involves added security features for their business.