Accessing financial services used to be tedious and stressful in the past. The traditional banking system is complicated from going to the bank, spending minutes on the line, and waiting several hours or days before a transaction can be confirmed.
However, in this digital age, there is a technological revolution that is transforming how we access financial services.
Fintech companies like Swissmoney are constantly creating cutting-edge solutions enhancing modern financial services. With technologies like digital apps, robo-advisors, and many more, the financial industry has had a significant impact.
Today, we explore how these cutting-edge technological solutions enhance modern financial services.
Let’s dive in.
Automation
Automation is playing a significant role in modern financial services. Gone are those days when workers had to repeat time-consuming tasks. With technology, employees at financial institutions can have more time to focus on more strategic activities.
One of the most common uses of automation in modern financial services is in the area of customer self-service. Automation allows customers to perform repetitive tasks such as checking account balances, sending funds to other accounts, and paying bills without the help of a human customer service representative.
This can save customers time and stress and allow employees to handle more complex requests.
Another key role in shaping modern financial services is processing financial transactions. Automated systems can promptly and accurately process fund transfers, withdrawals, and other transactions. This way, financial institutions can reduce errors and enhance efficiency.
In addition to customer self-service and transaction processing, automation is also being used in other areas of financial services, including risk management, compliance, and fraud detection.
Security
Cyber insecurity is one of the major challenges in this digital era. Customers and financial institutions are concerned about the risk of scammers and unauthorized access to customers’ data.
Thankfully, since the inception of cutting-edge technology, financial services providers can improve their security and protect user data.
One of the ways technology enhances security is via encryption. Encryption converts data into codes that only authorized individuals can decode.
Encryption is used to protect sensitive data like passwords and Social Security numbers. This way, it is more difficult for hackers to steal customers’ data.
Another way technology enhances security is through biometrics. Biometrics, like fingerprints and facial scans, are used to authenticate users and prevent unauthorized access to users’ accounts.
For example, users may be required to scan their fingerprints or take a facial scan before granting them access to their accounts.
Financial technology companies are also subjected to stringent compliance requirements like those imposed by the Payment Card Industry Data Security Standard (PCI DSS). These requirements ensure proper protection of data.
The use of two-factor authentication is a common way of improving security in modern financial services. With two-factor authentication, a user has to enter a code from their phone (either via SMS or email) aside from their password to log in to their accounts.
With the additional code, the user will be denied access to their account, making it more difficult for hackers to access such an account.
Reduced cost
Technology has provided ways to reduce the cost of providing and accessing financial services. One of the ways includes the use of mobile applications. With mobile apps, customers can access typical financial services like deposits, transfers, and bill payments. This helps financial institutions to cut costs on physical branches and employees.
Modern financial services providers can also save costs via automation. Financial institutions can automate repeated tasks like customer inquiries and payment processing. This way, they can reduce the cost of hiring human labor.
As financial services providers can reduce operational costs, they are more likely to provide services at a lower rate compared to traditional banking systems. By doing so, customers can enjoy more for less.
Aside from the typical banking services, technology also helps to reduce the cost of investments and lending. For instance, rob0-advisors, automated investment platforms, allow customers to manage their investments at a lower price than traditional advisors.
Also, Peer-to-peer lending platforms allow users to borrow and lend money without the need for a bank or any intermediary. This way, borrowers can save money on interest rates and fees.
Accessibility
With technology, financial services are more accessible to a wide range of people worldwide. This is because incorporating technology into financial services removes the many barriers peculiar to traditional banks.
For instance, customers in rural areas and other underserved communities can access financial services regardless of their location. With solutions like mobile apps, customers can open an account or apply for a loan without visiting a physical bank.
In addition, because fintech companies can offer lower fees and commissions than traditional financial institutions, financial services are more affordable for people with limited means.
Increased efficiency
Since the incorporation of technology into the financial services industry, there has been an increase in efficiency. One of the ways technologies enhances efficiency is via streamlining processes. With technology, processes like onboarding new customers and processing loans can be done faster and more accurately.
Financial service providers also provide customers with good customer experience. With chatbots and self-service portals, users can access financial services more promptly than in traditional banks.
Data analytics has also helped improve efficiency. Modern financial services providers can use data analytics to learn more about customer behavior and financial trends. This information can make better decisions, offer personalized solutions, and enhance risk management.
Conclusion
Incorporating technology into financial services has become the new normal. With technology, the financial services industry is expanding and scaling in its operations. These technology solutions are helping to improve efficiency, security, and accessibility.
Without a doubt, the future of financial services is bright with the technological innovations that are driving its operation. With technologies from fintech like Swissmoney, we can expect that many complex and time-consuming operations will become seamless and swift.
Therefore, stakeholders in the financial services industry must look out for new technologies that will reshape their operations. By positioning oneself for the new opportunity, we can leverage the benefits financial technology has to offer.
