The financial industry continues to improve with regular advances in automation and technology. Dubbed “fintech,” the combination of finance and technology has become a popular trend to watch for industry insiders and the general public.
Fintech has changed the way that money is exchanged. Most people know about crowdfunding and mobile banking, but there are more advances coming in 2020.
1. High-interest cash accounts
Traditional banks continue to pay minimal interest on cash accounts, and they continue to charge excessive interest in loans. Fintech is trying to bridge the gap with cash accounts that pay higher interest. Some Fintech companies are offering interest at 2% or higher. They come with debit cards and FDIC insurance. Many Fintech companies are not bound by the same market trends that traditional banks have to follow. These high-interest accounts continue to draw customers away from brick-and-mortar financial institutions.
2. Protective accounts for vulnerable populations
The news is filled with stories of senior citizens emptying their bank accounts when they receive phishing letters from investors from foreign countries. Teens are another vulnerable group that is targeted by unscrupulous people trying to make a quick buck. Fintech is working hard to develop systems that protect vulnerable consumers so they don’t give away their life savings to princes in faraway lands.
3. Adoption of cryptocurrencies
Cryptocurrencies are drawing the attention of financial institutions. Fintech companies are looking for ways to get into this growing investment opportunity. They also want to help their customers get into the lucrative online commodity. Along with easing the process of investing in cryptocurrencies, fintech is looking for ways to combine cryptocurrencies and blockchain management. The two segments of the financial industry are filled with regulations, so there is plenty of confusion. Fintech is looking for ways to make the two work seamlessly, without the perplexity.
4. Streamlined regulation processing
This leads us to the next trend in fintech: streamlining regulations. While it is important to maintain regulations to keep financial institutions operating honestly, it is vital that the institutions can understand the regulations. When the regulations are confusing, it is easy for financial institutions to make mistakes. With human oversight, errors happen. But, when the regulations are combined with technology, they can be automated so everyone follows them to the letter of the law.
5. Growing employment opportunities
When technology, automation, and finance work together, jobs are created. Most of the jobs require candidates to have tech skills, but they also need to understand the world of finance. Add to that necessary soft skills like having the ability to adapt and communicate with colleagues, and candidates can be difficult to find. Many of the newest fintech institutions are online only, so they have central offices and limited staffing. Employers are looking for candidates who have experience in programming, statistics, artificial intelligence, blockchain, analytics, and data science. College students should pay close attention to the job market and look into majors that will help them land these high-paying, high-demand careers.