Fintech or financial technology is creating a lot of buzz across the Indian financial services ecosystem through its extraordinary growth stories. The sector has grown immensely over the years, making us familiar with innovations like mobile wallet, digital payments, paperless lending, etc.
In fact, India is considered one of the fastest-growing fintech markets across the globe, as highlighted by a report.
Much of this growth can be attributed to the myriad government initiatives, along with the creative ideas of technology enthusiasts and startups becoming reality — both leading to ground-breaking innovations in the fintech universe the world has never witnessed before.
Given the impressive growth and transformations fintech players have brought to the country, here are the top technology trends that are redefining the fintech sector:
Businesses across the globe are constantly collecting, storing, and analysing personally identifiable information (PII) and other sensitive data without realising the repercussions of mishandling the same.
The increasing cases of PII data theft and cyberattacks on fintech companies malign the reputation of an organisation and also shakes the confidence of end-consumers, which, in turn, makes them reluctant from using tech-driven solutions.
To prevent this, companies must practice a few safety steps, including regular backup of their data, encryption of PII information to stop data loss incidents, implement two-factor or multi-factor authentication, and use VPN service, among others.
Taking these steps might not guarantee 100 percent safety from threat actors but will certainly minimise the chances of attacks. Moreover, DevSecOps methodology makes cybersecurity an integral part of the production pipeline, including architecture design, coding, and testing phases.
Accelerate document processing
While serving customers, fintech platforms gather a lot of customer data as part of their documentation process — be it address proof, registration certificate, or income statement.
However, since these documents submitted on the platform remains unstructured, most fintech players take the manual route to organise and analyse them.
This challenge often leads to delay in loan disbursements or other transactions of akin nature. Hence, players must invest in innovative technologies, which automates this entire process and make it seamless for customers and themselves.
For instance, companies can leverage a combination of cutting-edge advancements like Google Vision API and ML capabilities and Amazon Recognition to analyse documents to detect frauds, ensuring faster turnaround with minimal manual work by sales and risk teams.
We have already seen chatbots adopted by various sectors, including fintech, and there is no doubt how this automated solution has helped people across the country, especially in terms of customer assistance and management.
However, the language barrier has remained a key challenge for customers, making them reluctant from using various digital solutions. This is where a voice bot can step in to localise end-to-end interactions with customers and the company.
Firstly, companies must start offering services in multiple local languages for people hailing from any region can understand and consume the content.
Secondly, they must integrate a chatbot into their existing service portfolio, enabling customers to explain their financial problems in their preferred language and accordingly get customised and personalised solutions from the providers.
Account Aggregator (AA)
Just like UPI allows us to transfer funds from one bank account to another, AAs will facilitate the transfer of financial data between financial information providers (FIPs) such as banks and financial information user (FIUs) like insurance companies.
In short, AAS will enable fintech players to collect, assemble, and synthesise financial information of customers from multiple accounts, including savings account, loan account, investment account, PPF, income tax returns, etc., in a single avenue.
Doing so will help them drive financial inclusion and also build better products like credit scoring or underwriting for customers.
With constant technology evolution, the Indian fintech ecosystem has rapidly innovated over the years, giving us a clear picture of a digital-first nation that nobody has imagined before.
As more startups and traditional businesses join the league, we are destined to see a plethora of new and unique solutions in this space.
The future of the fintech sector is very bright, and we are certain to see this industry expanding and foraying into newer areas in the times to come.
(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of YS.)