The technology and innovation that is driving the growth of the Fintech industry are not limited to any one genre. An assemblage of various technologies including AI and cryptocurrency and Blockchain contributes a huge stage to its transformation into a futuristic world.
Several tech-service providers are innovating their products and services in order to revolutionize how financial technologies impact existing or potential business operations. Additionally, the BFSI industry as a whole is adopting various AI or cryptocurrency/blockchain-based business models to disrupt the market and gain an edge above others.
Let’s explore how AI and Cryptocurrency and Blockchain-based fintech solutions are becoming key to the future of the modernized BFSI sector.
AI-Based Fintech Solutions
Some significant trends depict a great adoption rate of AI tools in fintech where the implemented technology provides the customers and users with great benefits. While providing a holistic approach to financial advice across an organization, AI-enabled chatbots advice and sometimes coach their clients on improving their respective transactions and several other forms of trading and commerce. They also enable profiling their customers along with categorizing them. Categorizing, here, is done on the basis of all the factors they have access to, along with their risk profile as well.
Such tools when implemented properly help gather evidence and provide financial organizations with the necessary data that would allow them to identify fraudulent behavior or transactions. With its continuous advancements, the AI tools are improving on a daily basis while providing more engaging features for fintech industry.
Cryptocurrency and Blockchain-Based Fintech Solutions
The blockchain systems dealing in cryptocurrencies are one of those futuristic trends that will surely take the fintech industry by a boom. Technology possesses the power to transform the way people transact business or manage their assets. According to experts, blockchain and cryptocurrency is such a powerful tool that can sincerely help improve business, conducting fair trade and democratize the global economy.
According to Ittay Eyal of Cornell University, “for FinTech, Bitcoin’s ability to facilitate secure transactions when operated by a few thousand volunteer servers is evidence that perhaps the same could be done for existing interbank, or bank-to-bank (B2B), transactions, which are operated using secure dedicated servers. In FinTech’s existing setup, such transactions take a day or several days between issuance and settlement. Using a blockchain to mediate B2B transactions could improve performance such that an agreement could be reached in a fraction of that time.”
In addition to improving transaction speed and mitigate security and speed issues, the technology can also help financial institutions build smart contracts on the blockchain which would further facilitate the transaction that could be digitally represented using cryptocurrency.
Several businesses are observing the advents of cryptocurrency and blockchain in transforming fintech companies.
Additionally, the most renowned financial firm JPMorgan had announced in early 2019, that it is planning to launch its own coins known as JPM which would allow its customers to perform instant transfers over a blockchain.
The soaring discussions about ‘AI and Blockchain revolutionizing fintech’ are not just mere hype. Surely both the technologies live up to this hype while promising significant advancements and developments across several financial institutions. As the industry is undergoing a tectonic innovation period, it is believed that the two technologies will portray themselves as significant mainstays for the future of fintech.