In a 2018 report by Ernest Young, Banking of the Future: Embracing Technologies, India is viewed as being on the cusp of a digital revolution. Not only is technology is transforming how we do business and our habits in our homes; it is changing the way we manage our money. Our financial attitudes and habits are all being redefined in today’s environment. The result? Tech-savvy financial management processes range from savings to banking and even budgeting. Read on for a glimpse of a few ways technology is changing the money management landscape in this era (and possibly in the future).
The Rise Of Alternative Markets
From savings to lending institutions, brick-and-mortar banks are no longer dominating the market. A growing proportion of the population is becoming digitally adept and as a result, their wants are changing; something alternative lenders have been quick to utilize. The gap in customer satisfaction in regard to customer service and interest rates has also fueled the rise of alternative finance houses across the globe.
In India, the fintech industry is alive and thriving. In fact, the country has been repeatedly tipped to be a hotbed for innovation in the finance sector. Access to financial data has gained momentum with the introduction of apps and software such as PolicyBazaar, which allows industry-wide comparison of financial services from insurance companies.
In the money transfer and payment sector, companies such as Freecharge and PayTM offer a fresh way of paying monthly bills and sending money with the use of your mobile. The capital market (and access to it), has been transformed with digital lending in India set to increase by up to 15 times by 2023 thanks to startups such as Aye Finance which cater specifically to small and medium-sized enterprises. Gone are the days of filling out pages of loan applications and formal interviews. Now, businesses and entrepreneurs alike can have their answers in minutes.
The Rise Of Robo Advisors
A key question for many in money management is getting the best returns from their money. Whether it is investing for retirement or as a side income, a growing percentage of the working class is opting to invest. This is where Robo-advisors fit in. They have first introduced over a decade ago but recent shifts in the European and finally the Asian market have seen their use skyrocket.
Currently, the Asian market is growing by 5.6 percent according to the International Monetary Report. This invention is a low-cost alternative to a human investment advisor. Besides the reduced cost, the declined chance of human error and 24/7 accessibility are proving to be significant attraction factors for investors across India and the globe. Formulated using preset algorithms, Robo-advisors are just one example of artificial intelligence being used to address the complexities of financial decisions faced by individuals every day.
The senior population has been identified as one of the most promising markets. Most seniors deal with not only making life-changing decisions before retirement but also the monetary tension that can surround their retirement. One of those issues: Outliving their savings. So with this reasoning in mind, many are hopping on the investment train and thanks to Robo advisors, it is now done from the comfort of their own home for a fraction of the price paid to a financial advisor in person.
Making Biometrics A Norm
Biometric technology has been talked about for the past few years and more recently, has been the latest tool employed in the financial services industry. Banks and financial institutions have begun to place much more emphasis on the security of their customers and their customers’ data after multiple international incidents of data breaches.
In response, we have seen institutions move away from PIN codes and traditional measures and towards more personalized biometric tools such as fingerprint readers. One promoted advantage of this added measure; the data is not stored on the banks’ interface and therefore is more secure from being intercepted. Of course, fingerprint matches are also less likely to be imitated which in turn tackles credit card fraud and theft issues.
Biometrics is not just being applied to point-of-sale purchases but also integrated into online banking and mobile banking along with other measures such as voice and iris recognition. With a majority of mobile phones and computers now equipped with at least a fingerprint scanner, accessibility is no longer an issue. Judging from these technological introductions and rumored news of planned additions, it is safe to say the revolution of the money management world is not slowing down anytime soon.