Unleashing the FinTech potential in 2020
Wearable Device Technology
2020 promises to be generously peppered with more disruptive and iterative solutions in FinTech. FinTech partnerships with the ‘Wearable Devices’ technology space will emerge as the catalyst in Indian financial markets. With the global expenditure in the wearables market — including smart activity monitors, ear-worn gadgets, watches, clothing and more; projected to hit an estimate of $52 billion this year, FinTech startups will increasingly explore this segment.
Although in India, this is still a niche domain owing to consumer preferences towards smartphones, these devices are garnering greater interest as lifestyle additions. Leveraging IoT, wearables technology development in India is making way for FinTech applications to drive banking transactions, insurance, investment, trading and payments. This year will see further experimentation in this space with improvements on feasibilities and monitoring of security concerns.
While FinTechs explore areas of speech to command capabilities for a hands-free experience, payments on the go, live market updates, consumers are expecting to see specific innovations which their smartphones are not able to perform in addition to seamless integration with all of their devices. The future of FinTech solutions wired in wearable devices is here to stay with access to real time solutions over a long-term duration.
The era of aggressive UI/UX and Blockchain Technology
Payment firms commonly leverage cashbacks, attractive offers and incentives to gain an edge over their competitors and gain new business. 2020 will see a shift in focus to more efficient and intuitive UI/UX solutions. As a growing percentage of consumers make use of various payments processing applications on an everyday basis, Tanul believes integration between UI/UX and payments processing apps is on the cards for a hassle-free interface. Alongside, greater control for customers over how they transact-in terms of chosen platform, the instruments used to process the transaction, is set to gain significance in digital payments.
The growth of InsurTech, Healthtech and a B2B payments model for FinTech
Just as banks have found a strong ally in FinTech, the insurance sector is set to find a compatible partner in them while embedding FinTech into their strategic operating models. InsurTech and FinTech will converge more in 2020 to efficiently address consumer pain points in rural areas, deliver greater efficiency, lower the overall cost and broaden insurance distribution. FinTech in 2020 is expected to propel further into technology-empowered short-term insurance solutions that are popular across the globe and are venturing in the Indian space to target customer needs from all backgrounds.
As Healthtech startups are discovering and addressing root-cause mechanisms to disorders and increasing utilization of technology and AI, collaborations with other sectors will rise to provide an extraordinary healthcare experience to patients. GOQii’s tie-up with an insurance company to enable relaying of patient health data directly to the health provider or insurance provider is one such step in this direction, which is an already popular trend in the US.
With B2B startups in the FinTech space scaling growth, customer servicing and profitability will be a lot faster and 2020 is likely to see a qualitative rise in this sector serving niche investors and business requirements. High customer engagement, rapid revolutionizing of cloud computing on payment solutions, a more streamlined end-to-end user experience will enable B2B payments to override their B2C counterparts.
2019 has been a significant year for the digital payments industry in India and the pace of evolution has gone into overdrive. With the increase in adoption of digital payments, subsequent rise of frauds in the payments ecosystem is a growing menace. According to a RBI report, the banking system in India detected frauds worth Rs 71,500 crore in the financial year 2018–19. Therefore, data privacy and security are going to be the key focus in the payments industry with the voluminous increase of non-cash, instant payment transactions. Startups in fraud and risk management are going to play a vital role in the coming year as they will bring to the table key solutions for data protection and mitigating fraud.
Going by a more proactive approach for risk management in 2020, FinTechs will require greater ability to predict and detect cyber threats early. By looking carefully into the security gaps there will be a need to frame preventive mechanisms while keeping customer convenience in mind.
Blockchain is the other path breaking tech development that will take center stage this year. A recent insight by PwC into the 2020 technology space, opined that FinTechs are increasingly shifting large transactional volumes onto cost and efforts efficient Blockchain platforms. The benefit of automated updating of records will accelerate operations for these organizations and develop expert verification methods making the process immensely risk resistant. This year will be a time of aggressive testing and learning for FinTechs taking the support of blockchain processes.
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Originally published at https://bfsi.economictimes.indiatimes.com.