Financial service providers typically fall into one of two buckets: legacy brands and disruptors. Legacy brands are what you typically think when you think “bank;” large, established brands, often with physical locations, that provide a range of financial services. Disruptors, on the other hand, are innovative and digitally focused, pioneering new ways to simplify finance.
As the finance industry continues to be disrupted by new technologies and innovations, keep an eye out for these three digital-first trends on the rise.
A focus on financial literacy will improve consumer relationships with finance
Banking and finance are critical to our everyday lives, yet many individuals struggle with understanding basic financial terms and concepts. Many FinTech companies make it a priority to educate their consumers with content marketing on how to make healthy financial decisions and gain a more holistic understanding of their relationship with money.
Some leading FinTech startups are specifically targeting the younger generation, making it a goal to establish healthy financial habits early on around debt, budgeting, and investing for the future. Startups like FamZoo make learning finance basics fun, positioning parents as “banks” and children as “customers”. This metaphorical language encourages children to take out “loans” from their parents and earn allowances. Understanding how the loan process works from an early age removes the intimidation that can often accompany personal finances.
Promoting financial literacy in creative ways will continue to be a priority in the coming years as startups vie for a share of the digitally-focused finance consumer pool.
Microservices allow for agile and customizable solutions
The advent of microservices is one of the key reasons innovators have been able to disrupt legacy providers, releasing many of the constraints that have previously kept legacy institutions one step ahead. Microservices add a flavor of personalization, a proven marketing trend across multiple industries. Emerging technology enables FinTech companies and consumers alike with the ability to customize their solutions, adapt to real-time problems, and provide on-the-fly solutions.
Traditionally, legacy institutions have offered uniform solutions with many interdependencies, making it difficult to evolve and innovate without impacting the entire architecture. While large financial institutions can be innovative, it often takes much longer to introduce and establish new technologies.
Conversely, microservices serve as independent applications, allowing for the speedy development, testing, and deployment of updates. This model allows FinTech companies to work on many different solutions simultaneously, and, with fewer dependencies, quickly deploy service and product updates. The ‘a la carte’ concept is attractive to consumers, as they can select the specific services they want without relying on a full-service solution.
Check out how Bluetext client Paya is serving end-to-end, seamless, and innovative payment solutions specifically suited to their customers’ needs.
Predictive Analytics provide FinTech companies with a competitive advantage
Still a relatively new arm of data science, predictive analytics studies current and historical data to make predictions about future events, playing a central role in the FinTech space. Predictive analytics is especially relevant in this space because FinTech disruptors focus on developing technology that simplifies our long-term relationship with finance. Wouldn’t finance be a lot simpler if we had tools to predict future behavior?
Predictive analytics comes in handy for FinTech innovators for a variety of reasons, from cybersecurity and identifying employee value-add to customer experience. The ability to monitor and measure customer behavior across platforms allows FinTech innovators to provide the best possible experience for their consumers. Companies are now able to measure purchasing patterns, loyalty, and even feedback to tailor their services individually. This personalization will become even more important as the burden shifts to financial institutions to simplify finance.
As FinTech companies continue to evolve and level the financial playing field, keep an eye on how these three trends will serve key players in the FinTech space. Are you a company in the FinTech space looking to take your brand to the next level? Contact Bluetext.