How Technology Is Drastically Changing The Financial Sector
Technology has found its way into many traditional industries in our world. None more so than the financial industry. In fact, technology is so rife here that there’s even a concept called FinTech that combines the two into one medium. We’re not going to discuss that specifically, but we are going to look at how technology is changing and shaping this sector. What does this mean for both business owners and consumers in the financial services market?
Back in the day, certain processes could take days to finally finish. Depositing a check could leave you waiting 3-5 days before the money was in your account. Not only that, but you had to physically go to the bank to deposit it. Nowadays, you can scan checks through the camera on your smartphone, and it uploads to your bank’s app. From here, you simply deposit it, and the money can be in your account almost instantly. The same goes for things like loan applications. These can be done in minutes online, rather than spread over an hour or so at a bank branch. Technology has sped up the financial services industry, meaning business owners can get through more work and consumers are offered a streamlined service.
Following on from the point above, there is far more automation in the financial services industry than ever before. Automation is the idea that you set something in motion, and multiple tasks are completed without you needing to do anything. The rise in banking automation software makes it easy for institutions to offer different services to customers. One highly popular idea is the rounding up of spare change for savings or investments. Many financial companies are doing this now. It works by looking at your payments and rounding them up to the nearest dollar. The extra money that’s been rounded up will automatically be deposited into a savings account or used for investing. E.g. you spend $3.50 on coffee, it’s rounded up to $4, and the extra 50 cents gets saved. It’s but one example of automation in action, changing the way people save and invest.
The security in the financial industry has increased dramatically thanks to technology. Banks are able to be more technologically secure than they ever used to be. But, this extends down to the consumer level as well. Sure, credit card fraud is still a problem, but there are ways to counter this. The birth of mobile payments means that you don’t always need to bring your cards with you. Instead, you can pay using your phone – and the only way to do this is by using a passcode or a fingerprint/facial scanner. It’s more secure as there’s less chance of losing your phone, and if you do, the culprit doesn’t even have access to your card details. So, they can’t go online and start spending your money.
As time progresses, we shall see more technological developments in the financial world. Will there ever come a point where you can withdraw money over the internet and have it physically printed out at home? Who knows, but that’s just one of the many examples of lofty ambitions in this sector.