There’s not real argument to dispute the fact that the global conditions of 2020 affected us all and in turn had an effect on the tech sector. One could go as far to say that if anything, the strife of last year led to further innovations. Health leaders around the world coordinated to roll out a vaccine – something that usually takes years. Technology in a number of sectors was forced into acceleration and hence transformation, including the financial sector. As a result, there are certain changes and transformations to watch out for as 2021 continues to move forward.
Technology’s role can only increase
These days technology is of the utmost importance and a lot of it has to do with the generational shift. As it stands, millennials account for the majority of the workforce, and in the United States, over 50% of the population is made up millennials and those who are younger. Today’s youth have been reared on tech; they’ve been nurtured by tablets, smartphones and iPads. Should it come as any surprise then that young users are seeking out more tech savvy ways of conducting their affairs when it comes to financial services providers? This extends to personalised services with an insistence that access constantly be available by way various connectivity points on all devices and with an option of face-face interaction. More millennials have also turned to online trading as a result of improvements in technology, often electing to trade and speculate on bigger trading couples like USD/CAD (the US Dollar to the Canadian Dollar). Technology is no longer an afterthought or an aside for financial services – it’s an essential. Technology is playing a role in almost everything we do; banks have picked up on this and have ploughed a lot of money into improving their digital profiles. It’s a knock on effect that’s sure to effect other players within the financial sector.
Big data is playing an even larger role
As if big data hasn’t already dramatically impacted our lives, it looks like it’s going to play an even larger role in our lives. While the Big Five of the tech industry (Google, Apple, Facebook, Microsoft and Amazon) have been called out for hogging the majority of big data, many other players are also utilizing big data and capitalising on its benefits. Thanks to cloud computing, financial services are able to utilise potent analytical tools without having to incur the cost of new staff or new infrastructure. The results are that more firms in the sector are doing the same – using AI and predictive analytics, data analyses, aggregating data – all in the name of better insights and strategic decisions. The challenges of 2020 have illuminated the critical need for accurate data and so financial services have used big data to cut costs, plan better ,and provide essential parties with real-time results.
Cybersecurity protocols and data protection
While accumulating and analysing data is one thing, keeping it safe is another. Once again 2020 shone a spotlight, this time on cybersecurity. Cybercrime last year increased exponentially costing businesses, companies and organisations a ridiculous $11.4 million every 60 seconds. To combat this digital scourge, financial firms will need to employ tougher protocols when it comes to cybersecurity and data collecting.
Automation and reporting
Automation is a tough one because it’s always carried the stigma of replacing human labour which in turn means slashing jobs. Many may not be aware of this, but in the financial services sector, up to 40% of wealth management involves the collection of legacy or historical data and it’s been suggested that up to 95% of it can be done though the process of automation. By downsizing on the manual expenditure, firms can more effectively focus on strategy which in turn can lead to better client knowledge, better insights and better services.