Financial technology (Fintech) is becoming vital for the financial and technological sectors, which have always had one or two things in common and need each other. Recently, the synergy between both sectors has increased, making them virtually indivisible.
Despite all the advantages of Fintech, it has serious drawbacks. The fact is that any innovative ideas and achievements can be used far from good, for example, instead of convenience, people can lose their money.
Increasing risks for traditional firms
In a sense, the very nature of financial technology is destructive. All ideas and technologies are usually aimed at transforming existing solutions, and therefore the companies that drive them. And there is no malice in this. Today, solutions such as Ripple’s ODL (on-Demand Liquidity) already process cross — border payments in record time. As Ripple develops, there may come a time when conventional money transfer systems will be pushed into the background.
Financial innovation and modernization
The growth of Fintech development is unstoppable, and some traditional companies have already realized this. The only way for them to stay in the market is to introduce new technologies. Today, many firms are beginning to invest hundreds of millions of dollars in high-tech research that will ensure that they not only withstand competition but also strengthen their positions.
The client will still always be right
Historically, competition in retail has made life difficult for operators and has always been profitable for customers. If two companies offer the same services, but one of them does it better, customers automatically go there. This forces entrepreneurs to come up with ways to retain their customers and perhaps even poach customers from other firms. Thus, Fintech technologies ensure that the customer will continue to be at the forefront.
Fintech will continue to grow
Competing, companies will always strive to surpass themselves, which directly affects the development of the industry. In addition, if one company offers something, the competitor is forced to offer something better, contributing to the common cause.
High demand for technical expertise
Nowadays, the demand for technical knowledge is quite high, but over time it will only increase. Today, the financial environment has practically put financial competence on a par with high technical expertise, which includes the development of special programs, algorithms, training of technical specialists in the field of Statistics, Analytics and Databases.
There are already a number of banks that work only with digital technologies, which often help traditional banks make money: their services are much cheaper because the company does not have to spend money on logistics or new employees. Artificial intelligence is increasingly used in Fintech, especially in connection with the introduction of blockchain technologies.
By 2020, more money will be spent on investment in the Fintech sector, more joint projects will appear, as well as regulations for regulation. Technical expertise will be in demand much more than ever before.
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