[ad_1]
Amidst a disruptive environment, innovations in financial services are developing rapidly to meet changing customer expectations, improve internal operations or comply with regulations. Venturetec experts outline seven technology-driven innovation trends that play a dominant role in the financial services innovation environment.
Digital bank
Banks have already developed their digital platforms, and existing banks are now launching digital-only iterations without physical branches. A prime example is Tencent-owned WeBank, which offers completely digitized banking services and has replaced property guarantees with facial recognition technology and credit scoring based on data analysis.
Other examples include South Korea’s KakaoBank and Indonesia’s Jenius, which use simple and user-friendly interfaces to attract customers. As banks around the world continue their cost-cutting efforts, a fully digitized offering will be the next logical step for many.
Process automation
A key advantage of going digital is the ability to automate banking processes – another trend that is gaining momentum. Venturetec highlights Kyckr – a UK-based automated tool that accesses over 180 company registries in real-time and generates compliance-compliant Know Your Customer (KYC) data. This tool can ensure compliance, accelerate the onboarding process, improve the customer experience and increase productivity by freeing up resources.
Another prime example is the use of automation in the IPO verification process. There are 127 steps to an informal IPO checklist, half of which are now automated by Goldman Sachs using its Deal Link digital tool. Again, this tool frees up bankers to focus on other key tasks.
A third example that demonstrates the progress of AI is the UBS Companion – a virtual avatar of any given firm’s chief investment officer who is available for consultation at any time. The tool allows for voice detection and even eye contact, making it easy to have a real-time conversation with the client.
Blockchain
Blockchain was created to manage Bitcoin transactions. It refers to a distributed ledger that can be updated by multiple users in real-time, with each transaction recorded and incorporated into a block. This technology enables decentralized, reliable and transparent access to record keeping, which are all core aspects of financial services.
As a result, blockchain quickly gained popularity in the financial sphere with many examples of creative applications. Venturetec points to Singapore’s DBS Bank, which has joined a global blockchain network of banks and digital solutions called Contour with the specific goal of digitizing the entire credit settlement process. Meanwhile, Mitsubishi UFJ Financial Group has developed a blockchain platform designed to process more than 1 million financial transactions per second.
Biometric payment
The use of biometric technologies to authenticate and secure financial transactions is also increasing. Biometric technology, designed to recognize users’ physical features, has significant applications in identity verification and payment authentication.
For example, online payment platform Alipay uses fingerprint and even smile detection technology to authenticate payments. Japanese IT services giant Fujitsu has also partnered with Lotte Card to develop the HandPay app, which uses palm recognition technology to authenticate payments.
Machine learning
Machine learning is the ability of automated technology to autonomously change its response based on user data and behavior, thereby improving an algorithm or way of working. The technology has a wide range of applications in the healthcare and insurance industries, while banks rely heavily on customer experience to outperform the competition, making machine learning a key tool in the banking belt.
Outside of the customer experience, Venturetec uses the example of ZestAI to show how machine learning can be used to develop reliable credit data, creating greater diversification opportunities for lenders. In other applications, JPMorgan uses its Emerging Opportunities Engine to inform its investment banking deals through predictive recommendations derived from automated financial and historical analysis.
Internet of Things
Internet of Things technology is also penetrating the world of financial services. The technology enables the integration of various digital devices without human intervention. Financial services institutions are using technology to tap into the world of information.
For example, AIA Vitality uses data from fitness trackers to offer discounts on annual premiums if the user lives a healthy life. At the same time, specialist underwriter Lloyd’s of London Munich Re Syndicate is using sensor data to fine-tune its weather forecasts to help clients measure the impact of weather on their operations.
Natural language processing
Natural Language Processing (NLP) – an iteration of voice detection technology – makes it easier to control machines using the human voice and language. Most financial services companies and insurers use NLP to manage customer service and interactions. Through cooperation with IBM Watson, Deutsche Bank offers its clients procedural advice using a combination of AI and NLP.
Venturetec points to other examples such as Allstate, which has developed a voice assistant capable of processing and answering more than 25,000 customer inquiries per month.
[ad_2]