Change is the only constant, and now that we have lived through what’s undoubtedly been the most unpredictable year of our lives. I would say it is imperative that from our experiences in 2020, we learn, unlearn and relearn to be stronger individuals in 2021.
Demand for Fintech solutions has intensified as it has brought comfort and ease to everyone. This makes the Fintech space crucial to all, and moreoever, it has a promising future to look forward to.
So, what will the industry look like in 2021? Here are a few things to look out for in the Fintech ecosystem:
Focus on People – The best Customer Experience in Fintech is the most powerful factor for customer acquisition. Fintech are making moves towards modes through which customers can easily control their transactions with just a click — for example, by opening digital accounts and completing the entire process over the internet. Hence giving rise to digital banks all across the nation. The Fintech industry in 2021 will cut the distance between people and technology. Even more than ever before.
Open Banking – Banks under this can share information of their clients securely to a third party. This will help banks approach more Fintechs to help digitize their processes. Going ahead with these partnerships would lead customers to avail of a more systemized and seamless digital banking experience, thereby promoting a more creative economy and carving a path towards a more financially inclusive India through digital. Cooperation between banks and Fintech companies will intensify. Traditional financial establishments need agility and technology. The two worlds will collide, and to my mind, this Fintech outlook for 2021 is amongst the momentous ones.
Payment Innovations – During the pandemic, a lot of enterprises engaged in product and process innovations to achieve both — greater customer-centricity and ability to handle huge disruptions. Payment innovations in Fintech have multiple mechanisms. These are mobile payments, contactless payments, mobile wallets, smart speaker systems, etcetera. There is likely to be high adoption of these, which in turn should result in a significant number of innovations in the payments space. Indeed, Global Market Insights, Inc., estimates that contactless payment market size will cross USD 100 billion by 2026. This change will likely occur mainly because of the Gen Z’s who are more accepting of and who favour digital transformation, technology and drive innovation in payments. Gen Zs are on top of this technology-driven change as they are earlier adopters of this change and the future too.
Security– Transactions are moving online and consumers are using their smartphones. This helps add greater security to both, transactions and online banking, with the help of biometrics. We log onto our phones securely through a fingerprint scanner or faceID; these concepts have given rise to added security for your account, and help reduce susceptibility to fraud or hackers. This helps Fintech companies integrate added security, and therefore, one looks forward to 2021 enabling even secure transactions between parties.
Disruptive Technology – The most important aspect to look out for in 2021 would be disruptive technology undertaken by various organisations in the sector — in the form of Neo banking, AI, IoT, Machine learning, etcetera. This, because there is a constant demand for innovative ways to conduct activities. We, as an organisation, are moving towards Neo banking; we believe it will disrupt the market this year due to the increased demand of technology-driven banking. The entrance of Blockchain Technology will make further noise all over the world. The global Blockchain market is expected to grow from USD 3.0 billion in 2020 to USD 39.7 billion by 2025 — at an effective Compound Annual Growth Rate (CAGR) of 67.3% during 2020–2025.
Above everything else, the Fintech industry for 2021 will focus on people and on the needs of the customers. We are likely to see massive adoption of artificial intelligence (AI) and a data-driven approach. I believe Fintech is set to transform the financial sector in multiple ways by easier account setups and no-fuzz transactions, and should also provide a strong boost to eCommerce everywhere.
