One of the biggest disruptors in the financial industry over the last decade or so has been Fintech. Using technology to solve a slew of problems faced by banks has caught on and is here to stay. While FinTech has revolutionized sectors such as personal finance and banking, there are still a few places where its potential hasn’t been utilised.
Here are a few problems Fintech technology can solve:
Increase in Regulations
Ever since the 2008 market crash, policymakers have been forced to lay greater emphasis on safer financing. The financial crisis bought in newer regulations in the hope that it would restore confidence back into the banking industry. With most banks having paid back their regulatory incompliance fines, regulators are starting to ask for innovation in these markets and they need to create a safe environment.
Startups in the FinTech industry should expand beyond their home nations and make international payments possible. The home country regulations can be expensive with a lot of legal fees but innovations in FinTech courses such as Blockchain should be able to solve this issue and make it easier.
Regulatory measures can be a roadblock for many companies looking to grow domestically. By having the freedom of moving abroad, they can expand their horizons and successfully continue their business elsewhere.
Product information is generally very random and scattered all across the board. Different folders, separate drives, a random excel sheet can all be frustrating to follow up on.
Product distribution lines can be managed in a much simpler manner with the help of FinTech. By having a central record of all transactions, companies can have a centralized repository of their products. By innovating with the front-end and introducing cool searching features, FinTech can be used to eliminate the same for banks that aren’t using this system yet.
Many banks today have tools for compliance reporting but since there are a lot of complexities involved in regulatory requirements, it just isn’t enough. Compliance violations are becoming harder to find and most of the systems, written in legacy code aren’t cut out for this task.
RegTech, a new field in the financial services has boomed, with over 150 startups present globally. These startups understand data better than anyone else and leverage a lot of data architecture innovations. While still ongoing, this is one of the major problems that Fintech Technology / Financial Technology can solve in today’s world.