The Future of Finance: How Fintechs Are Leading the Charge

Kristiana Sylvester

Tuesday, Mar, 26, 2024
2mins

The future of finance is being shaped by fintech pioneers who are embracing innovative technologies to drive transformational changes. From democratising cash investing to revolutionising payment transfers and lending, start-up fintechs are breaking down barriers to financial access. Whether you’re an aspiring entrepreneur aiming to launch your own fintech start-up or an investor seeking to capitalise on the next big innovation in finance, staying ahead of the curve in this ever-evolving landscape requires keen insight and a readiness to embrace change. Let’s explore the dynamic shifts in the fintech realm and uncover strategies to leverage innovation.

Generative AI

The rise of generative AI offers businesses an opportunity to outpace their competitors by harnessing its transformative capabilities. Unlike previous technologies, generative AI has the unique potential to revolutionise every facet of a company’s operations; driving both productivity and growth on a scale that can redefine performance benchmarks. With its ability to enhance customer interactions through intelligent chatbots and streamlining decision-making, generative AI promises significant time savings and efficiency gains. According to Gartner, the adoption of AI technology in the financial services sector is poised to skyrocket, with 80% of firms expected to invest in AI by 2026. Moreover, by 2032, investment in AI is projected to reach $118 billion, empowering financial institutions to deliver personalised solutions that elevate customer satisfaction and optimise financial outcomes.

How is blockchain disrupting banking and lending? 

Core banking comprises transaction, loan, mortgage, and payment services, often reliant on laborious processes. For instance, obtaining a mortgage can take up to two months for individuals and securing a business loan can take up to three months for small or medium enterprises. Blockchain technology offers a solution by streamlining banking and lending operations, mitigating counterparty risks, and expediting issuance and settlement times. It achieves this by enabling authenticated documentation and KYC/AML data, reducing operational risks, while facilitating real-time verification of financial documents. Moreover, blockchain streamlines credit prediction and scoring markets, leveraging user activity and sanctioned data for faster decision-making. Additionally, it facilitates collateralisation of assets through digitisation, enabling real-time asset management, tracking, and regulatory compliance enforcement. Paypal, Mastercard, and American Express are among the key players leveraging blockchain technology to transform the core banking landscape.

Democratising cash investing  

With the widespread availability of online platforms and mobile applications, people from diverse company backgrounds now enjoy unparalleled access to investment opportunities previously reserved for institutional investors. Within the cash management space, those with excess liquidity now benefit from simplified onboarding processes and access to niche products. These individuals can conveniently monitor their portfolios and access real-time data, bypassing traditional intermediaries like brokers or financial advisers, thus minimising risk, saving time and maximising returns. This trend reflects a shift towards direct control over investments, empowering individuals to build wealth on their own terms.

Case Study:

TreasurySpring stands out as a pioneering force in the industry, offering a uniquely robust product accessible through an intuitively integrated digital platform. The platform unlocks access to high-quality cash investment options, such as with investment-grade banks, governments, and corporations, spanning multiple currencies. Onboarding with TreasurySpring is a free and digital process, only requiring a single KYC. Its client base includes FTSE 100 corporations and tech unicorns through to family offices and VC-backed companies. TreasurySpring empowers these entities to efficiently manage excess liquidity like large, sophisticated financial institutions, all without the need for extensive infrastructure or resources.

Reinvention as the strategy for success

To ensure long-term survival, a company must periodically undergo reinvention, transitioning from the plateau of one business performance curve to the upward trajectory of another. However, only a handful of companies manage to make this leap successfully when the time comes, often because they initiate the reinvention process too late. The annual Accenture Pulse of Change Index found that the rate of change affecting businesses has risen steadily since 2019 — 183% over the past four years. In response, 83% of organisations have accelerated the execution of their transformation since last year, through adopting fresh tech.

In conclusion, remaining ahead necessitates a shift towards openness to fresh perspectives and a cultural and operational ethos that embraces adaptation, all underpinned by a versatile digital foundation.

 

*TreasurySpring’s blogs and commentaries are provided for general information purposes only, and do not constitute legal, investment or other advice.

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