In terms of the state of global financial services, it is apparent that there hasn’t been a great number of positive developments in 2017. With ongoing political tensions, changes in regulatory policies, an increased level of competition, and the emergence of new models and technologies, financial institutions and even ordinary citizens like us are faced with multiple challenges every year. However, this doesn’t mean that the struggles will continue in the coming years. Many financial analysts still believe that the financial trends of 2018 will act as a critical stepping stone to something even greater.
Learn more about the five finance trends in 2018 and know how you can adapt to the new challenges or how you can use these changes to your advantage.
Shift to Digital Systems
In response to the increasing consumer demand for advanced platforms and improved user experience, many financial institutions are expected to invest heavily in digital systems. From this year onwards, simplifying the process through digitalization will be regarded as the main trend in the world of finance. Additionally, purely digital banking institutions will be seen as a major threat to traditional lending companies and banks.
The Rise of Data Analytics
The importance of data, not only in the aspect of finance, will become more evident in the future. The ability to access data and to retrieve useful insights will be seen as an advantage in the financial services sector. Understanding the data through analytics will be very useful for innovating technology processes and improving business operations.
The Surge of Automation
As in the recent years, the collaboration between finance and technology has been a very productive and progressive process. Creating automated user interfaces will be the main goal of most financial institutions in 2018. One of the possible applications of an automated system will be a risk management support, wherein consumers can get real-time risk analysis reports that will operate within regulatory limits. Automation is also expected to dominate trading platforms which will offer calculated risks to investors. Anyone interested in using these automated systems is expected to read the full review to understand what the risks and limitations are.
Lending companies are usually on the losing end in times of financial crises wherein most of the consumers are challenged to fulfill their credit obligations. Many financial institutions, however, have learned to adapt to these situations by optimizing algorithms that are used to assess the credit profiles of their customers. These alternative lenders take advantage of secondary data as a basis for credit rating, which includes social media profiles, online receipts, mobile bill payments, GPS information, and other types of data.
The potential of blockchain technology will no longer be just a concept as its real-world application is expected to start materializing towards the end of the year. The distributed ledger technology, considered by some as the greatest invention next to the internet, will provide great benefits to financial institutions, more especially in reducing operational costs, speeding up the processes, and improving overall efficiency.