Financial Software Services Archives

Future of Credit Underwriting Software and its Impact on Business

In today’s digital age, credit underwriting plays an integral part in determining the financial viability of businesses and individuals. According to reports from Experian and Praxis Global Alliance, India reached an impressive milestone of USD 270 billion in digital lending in 2022. Disbursements also saw an uptick of 11%. To keep up with this growth, robust and efficient credit underwriting is a must-have for financial institutions.

The conventional underwriting process, although effective, often depends on manual assessments, making it laborious and prone to human errors. But with technological advances and the emergence of advanced credit underwriting software, underwriting is poised for a significant shift in the future. This software leverages the power of artificial intelligence (AI), data analytics, and machine learning (ML) algorithms to transform the underwriting landscape with multiple benefits.

This blog post explores the future of credit underwriting software and how credit underwriting software will shape the future of businesses and reshape the financial landscape.

What is Credit Underwriting Software?

Credit underwriting software primarily automates and streamlines the process of assessing creditworthiness. It analyses credit history, income, and debt data, generating a credit score.

The software gives lenders risk evaluations and suggestions for loan terms, interest rates, and amounts. It enables accurate and objective credit determinations, expediting lending procedures and effectively controlling risk by integrating with other systems and utilising machine learning.

Comprehending the future of credit underwriting software is crucial as businesses navigate an increasingly competitive market. Besides streamlining processes and improving risk assessment capabilities, the software promises to influence better lending decisions.

Transforming Business Landscape: Impact of Credit Underwriting Software

As credit underwriting software continues to shape the future of businesses, let’s explore the key areas where its impact is most significant.

1. Enhanced Efficiency

Innovative credit underwriting software simplifies lending operations by automating data collection, processing, and decision-making. It expedites the processing of credit applications and improves customer satisfaction.

Lenders may identify unique credit risks across businesses using analytics and real-time data visibility, which also helps them build comprehensive borrower profiles. These insights improve decision-making by enabling underwriters to make informed decisions and foresee potential contingencies.

Underwriters can also focus on subjective aspects due to the efficiency achieved through automation, which removes duplication in administrative work. By leveraging these technologies, businesses can streamline their procedures, reduce risks, and improve the efficacy of their lending operations.

2. Improved Accuracy

Credit underwriting software uses advanced analytics and rule-based decision-making to facilitate quicker and more accurate credit evaluations while reducing bias and human error. Underwriters can analyse complicated credit risks based on current market trends and borrower behaviour because of real-time data visibility.

Future credit underwriting software will increase accuracy using machine learning algorithms and advanced analytics. These technologies offer accurate evaluations of creditworthiness by analysing large amounts of data.

Therefore, businesses can make well-informed lending decisions, lowering their default risk and enhancing their loan portfolio quality. The outcome is an improved underwriting procedure advantageous to lenders and borrowers.

3. Alternative Data

Fintech companies are including alternative data sources beyond traditional credit bureaus. The emergence of alternate data has proved to be a boon for the underserved. The vast amounts of data available and accessible to lenders equip them with a comprehensive view of the prospective borrower, enabling them to derive new and meaningful insights.

This contributes to developing a complete picture of a person’s or company’s financial behaviour and creditworthiness. Tech businesses are using non-traditional credit bureaus as alternate data sources. They collect data from non-traditional places, including utility bill payments, rental payment histories, social media usage, and smartphone usage.

4. Risk Mitigation

Credit underwriting software conducts a thorough risk analysis using contemporary analytics and data analysis methods. Businesses consider a borrower’s creditworthiness by looking at factors such as income, credit history, debt-to-income ratios, and alternative data sources.

Early warning systems built into the software monitor market trends and borrower behaviour to advise businesses of potential risks and enable proactive risk mitigation. Risk modelling and stress testing abilities assist in determining the likelihood of default and predicting possible losses. In contrast, fraud detection features detect and prevent fraudulent activities, minimising the risk of defaults.

Portfolio monitoring and management tools provide real-time visibility into loan performance, enabling businesses to detect and mitigate concerns quickly.

5. Personalised Lending

In the future, credit underwriting software will offer personalised loan experiences by utilising data analytics and advanced algorithms. After analysing large data sets, the software will evaluate each borrower’s profile and present them with customised loan terms based on their unique needs and creditworthiness.

Hence, borrowers will be more likely to have their loan applications approved and can access loans with cheaper interest rates, improving their financial stability. Reduced default risks and higher-quality loan portfolios are advantageous to lenders.

Personalised financing increases customer satisfaction and loyalty, leading to repeat business and strong referrals from others. By offering customised solutions that enhance financial outcomes for both borrowers and lenders, credit underwriting software has the potential to revolutionise lending.

6. Compliance and Regulatory Adherence

By implementing robust features, credit underwriting software will prioritise compliance and regulatory adherence in the future. Businesses can thoroughly investigate potential borrowers, evaluate their adherence to regulations, and keep track of regulatory developments.

Adhering to compliance rules allows businesses to avoid penalties, legal risks, and reputational harm. To determine the eligibility and reliability of the borrower, the software will collect and assess relevant information. Businesses can guarantee continued adherence by maintaining regulatory standards and automating compliance rules.

This dedication to compliance will improve reputation, credibility, and trust, drawing in new investors and reducing non-compliance risks.

Final Note

Credit underwriting software increases efficiency, improves accuracy, uses alternative data sources, mitigates risks, enables personalised lending experiences, and ensures compliance and regulatory adherence using artificial intelligence, data analytics, and machine learning algorithms.

Overall, the future of credit underwriting software looks to be one of process simplification, enhanced risk assessment, and improved loan decisions. It will positively impact businesses, resulting in improved compliance and regulatory adherence and higher efficiency, accuracy, and personalised financing experiences.

However, understanding and implementing credit underwriting software will be essential for success as businesses navigate an increasingly competitive market.

Finezza provides AI-enabled lending lifecycle and credit evaluation platforms that help banks streamline and optimise their transactions.

How to Integrate Financial Statement Analysis Tools into Your Business Operations

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A report released by Accounting Today found that cash flow issues contributed to the failure of 82% of small enterprises.

However, suppose the businesses could access a better overview of their financial statements. In that case, they might see it coming and could resolve the cash flow issues before they reach a tipping point.

Financial statement analysis is a critical component of every successful corporate operation. Making wise business decisions requires having access to financial statements, which offer insightful information about a company’s financial health and performance.

As a result, you may enhance financial decisions, cut expenses, and increase profitability by integrating financial statement analysis tools into your company’s operations.

This article highlights the importance of financial statement analysis tools and strategies to incorporate into your business operations.

What Is Financial Statement Analysis?

The process of analysing a company’s financial statements to get insights into its financial health and performance is known as financial statement analysis.

The three key financial statements examined during this process are:

Income statement
Balance sheet
Cash flow statement

Benefits of Financial Statement Analysis

The use of financial statement analysis is diverse, and it can benefit a business in a variety of ways. For example:

Comprehensive analysis of financial performance

First and foremost, financial statement analysis assists firms in evaluating their financial performance over time, identifying areas where they excel and places where they need to improve.

This data is helpful for establishing financial objectives and identifying key performance indicators (KPIs) that will assist the company in meeting these objectives.

Course Correction for Profitability

Financial statement analysis assists companies in determining their profitability, liquidity, and solvency. Businesses can determine how successfully they make profits, manage debt, and meet financial obligations by calculating ratios such as the return on investment ratio, current ratio, and debt-to-equity ratio.

Assess risks and detect opportunities

Third, financial statement analysis can assist firms in determining the financial health of their suppliers, consumers, and competitors.

Businesses can detect possible risks and opportunities by analysing the financial statements of these organisations, allowing them to make educated decisions regarding their business operations.

Financial statement analysis is valuable for evaluating organisations’ financial health, making sound financial decisions, and identifying improvement opportunities.

Integrating Financial Statement Analysis Tools: 5 Effective Strategies

Integrating financial statement analysis tools can assist you in making informed company decisions. Here are some efficient methods for incorporating these tools:

1. Identify the financial statements that must be analysed

Before you begin analysing financial statements, you must determine which are critical to your company’s operations.

You may also need to analyse other financial statements, such as the statement of changes in equity or the notes to the financial statements, depending on your business operations.

After identifying the financial statements that need to be examined, you can move on to the next step.

2. Select the appropriate financial statement analysis tools

Financial statement analysis tools are widely accessible on the market, ranging from simple spreadsheets to complicated software systems.

When deciding on the best financial statement analysis tool, consider your budget, the complexity of your financial statements, and the level of detail you require. Choose the tool that best fits your company’s needs.

3. Correctly interpret financial statements

Even for experienced business professionals, interpreting financial statements can be difficult. Evaluating financial statements properly while analysing them carefully is imperative to enhance business operations.

Ratio, vertical, and horizontal analysis are standard financial statement analysis methodologies.

In ratio analysis, current, debt-to-equity, and return-on-investment ratios are calculated. The vertical analysis involves calculating the percentage of each financial statement item. Horizontal analysis entails comparing financial statements from different time periods to identify trends and changes.

Using these techniques, you can accurately interpret financial statements and make more accurate decisions.

4. Improve business operations through financial statement analysis tools

The purpose of financial statement analysis tools is to provide you with valuable insight and information about your company. By analysing financial statements, you can find areas where your firm is functioning well and areas where you need to improve.

For example, if you discover that your current ratio has decreased in recent months, you may need to raise your liquidity. Similarly, if you see a low return on investment, you may need to reconsider your investing approach.

Therefore, evaluating financial statements can reduce expenses, boost profitability, and improve overall performance.

What Features to Look For in a Financial Statement Analysis Tool?

When choosing a financial statement analysis tool for your company, consider the features that will best meet your requirements.

Here are some important characteristics to look for in a financial statement analysis tool:

1. Customisation

Look for a solution that allows you to tailor the financial analysis to your individual business requirements. This could entail developing customised financial ratios, producing customised financial reports, and establishing customised benchmarks and goals.

2. Integration

To streamline data gathering and analysis, a good financial statement analysis tool should be able to interact with other financial tools, such as accounting software.

3. Accuracy

The tool should be accurate and dependable, extracting real-time data from financial accounts and performing appropriate computations.

4. User-Friendliness

The tool should be simple to use, with an intuitive design and clear instructions. This will ensure that all stakeholders, from business owners to finance specialists, can efficiently use the application.

5. Visualisation

To assist users in quickly comprehending financial trends and patterns, a good financial statement analysis tool should include clear visualisations of financial data, such as graphs and charts.

6. Cost

Finally, consider the tool’s cost and whether it fits within your company’s budget. Some financial statement analysis tools may be more expensive than others, but it is critical to weigh the cost against the value provided by the tool.

These elements can assist businesses in selecting a financial statement analysis tool that meets their individual financial needs.

Summing Up!

Incorporating financial statement analysis tools into your business operations will assist you in making educated financial decisions, lowering costs, and increasing profitability.

To properly incorporate financial statement analysis, you must first decide which financial statements to analyse, then select the appropriate financial statement analysis tool, accurately interpret financial statements, and employ financial statement analysis to improve business operations.

By following these tactics, you may effectively use financial statement analysis tools to take your business operations to the next level.

For this, you can choose one of the best fintech tools for your business: Finezza‘s Bank Statement Analysis tool Precisa.

With its cutting-edge features for automating the process, Precisa is an online financial analysis tool that lenders use to evaluate and analyse the bank statements of potential loan applicants. It also provides analytics and other specialised solutions, such as API interfaces, allowing traditional lenders to process loans faster.

Additionally, Precisa Score is a built-in security feature that helps lenders evaluate an individual’s financial position before approving loans.

How Will AI Shape the Post-COVID Future of Financial Services in India?

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The finance industry embraced technology with open arms ahead of time, only to earn an early mover advantage. The result is promising changes in the finance landscape.

Today, products like chatbots, automation, data analytics, cybersecurity, and more are questioning India’s future in financial services.

Technology battled the challenge of financial inclusion that the pandemic brought forth with Artificial Intelligence or AI piloting the initiatives such as gathering data.

It is now time to make sense of the data hence gathered. So let’s explore the possibilities of how AI could shape the future of financial services in India.

Stakeholders Spearheading AI-Driven Solutions in Fintech

AI has a significant footprint on nearly all sectors but with varying degrees. For instance, investment banks have been the major player in AI adoption. Leveraging NLP and ML, they have shaped how AI can be adopted.

This is followed by the retail banks, which have grown accustomed to using predictive analysis to support customer retention initiatives. It includes the process of mining present and past data and statistics to predict future behavioural patterns.

Banks construct strategies to retain customers by delighting them based on the likely customer behaviour. The industry players probably lagging are insurers, maybe because of the limited set of products.

Also read: The Future of Blockchain and Cryptocurrency in India

Other AI-based technologies that banks use are anti-money laundering, anti-fraud, compliance, credit-underwriting, and smart contracts technology.

Some AI Implementation Efforts Companies Bank On

The adopters of AI have reaped some fantastic benefits by deploying it into their business strategy. In a nutshell, AI backs up innovative efforts to launch new products and services or even find and enter a new market of opportunities.

Presently, the extensive benefits of AI in the finance sector feature lower operational costs, data-driven decisions, predictive analytics, and ramping up employees’ working capacity.

There’s more: AI enables better product curation, improved risk management, elevated marketing services and high customer satisfaction.

This is our affirmation that AI would help companies break beyond the boundaries that legacy players planted.

For instance, insurers are expected to experience the highest AI adoption rate. This is because they have the most room for adoption as they lag and have a limited product range. As a result, the next five years can be a significant game-changer in the face of insurance products.

How can companies invest in AI?

AI cannot bring disruptions if not invested strategically.

Therefore, organisations need to evaluate the success AI can help procure for them. It is a critical aspect to consider for business strategy.

Also read: Stages in Loan Origination Explained

But, how can a company evaluate the success of the application?

There are three reliable metrics that the existing users of AI believe in. Pinning the most reliable metric to track the views here might get contradictory, but here we are, with the top three metrics:

Customer satisfaction – Some companies believe the success of AI ultimately boils down to the customer or stakeholder’s satisfaction. Any improvements in the level of satisfaction show AI’s potential in action. Some great examples of measuring AI success lie in NLP and ML, including tools like automated chats and requests for quotes (RFQs).
Shrinking operational cost – AI can, through cutting manual processes, among other ways, help reduce operational costs. Higher costs that AI deployed tools help save, propels better performance, and eventually succeed.
ROI – AI can construct a better road to travel and reach the expected Return on Investment (ROI). AI initiatives towards increased ROI are extraordinary measures of its success and its capacity to scale.

The possible roadmap to AI’s evolution

AI can help companies scale and innovate, but how can we possibly reach the destination is still a matter of concern?

Earlier, the business strategy was simple: Look through labour costs and find the rates that best fit manual, repetitive and process-driven tasks.

But now, companies look for digitised solutions, and in case they can afford them, they choose to hire robots. Ultimately, the fundamentals of an organisation’s operational process are up for some serious change.

This is how the traditional or legacy structures of work are shattered.

Another possible obstacle in the journey of financial industry evolution is job opportunity. Job opportunities are likely affected by AI’s wide-scale adoption, and existing efficiencies might be up for a review.

Also read: 5 Ways In Which AI Is Revolutionising The Lending Business In India

If you think this is all, we urge you to think again. The entire shift in customer experience and job possibilities would also have a major impact on real estate.

People whose job replacement is not on the books will be able to achieve more and get more things done with the same amount of workload.

Beyond this, the layout of the journey is much more than job replacement. It is also so much more about rightly utilising AI and supporting tools. The risks of AI are potentially high given the size of the organisation and its understanding of AI capability.

Any roadblocks on the journey of expansion?

Yes, the cost is the major roadblock organisations can experience while trying to venture into AI. Insufficient infrastructure and poor data quality are the significant areas of worry.

Companies with larger income pools have an advantage over others. For instance, they can enjoy the potential of AI sooner than their smaller counterparts which may entail growing beyond a threshold that others can reach.

Also read: How Will Machine Learning Transform Credit Underwriting Software?

Organisations are aiming to spike up their investments in technologies like AI that have the potential of revisiting how legacy firms work. However, it is not about redefining how the finance industry works but rather letting the foundations stay intact and trying to build better pillars to business success.

If you love the requisites of the fintech industry as much as we do, follow up with the blog section of Finezza. We keep posting the latest updates from the world of finance so that you’re always a notch ahead.

How Developing Nations Are Driving the Mobile Banking Revolution

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Technology makes it easy for companies to open the floodgates of the financial system to the masses; mobile banking is the proof. Moreover, fintech (of which mobile banking is a part) has revolutionised the banking sector, forcing it to undergo changes that would otherwise be daunting.

But now, we live in the era of customised banking services with a solid digital infrastructure. And new technologies have just started emerging, which means we are up to visualising major game-changing products, features, and services, especially in the developing nations.

We have heard numerous mobile banking innovation stories from across the world, such as NPCI’s Interbank Mobile Payment Service (IMPS), M-Pesa, etc.

With an early mover advantage, they changed the face of banking in developing nations. But, perhaps, they are just getting started in the fintech space.

Mobile Banking Is Helping Build Resilient Nations

In developing nations like India, access to banking services in remote areas is close to nil. But mobile banking helps channel the power to equip people with banking services, turning financial inclusion into a reality.

Mobile banking, aka mobile money, is a possible channel for providing banking solutions through cell phones.

Customers can, through their mobile phones make deposits, and withdrawals, transfer money from accounts, pay bills, and place balance inquiries. The latest additions to this facility are investment options and other schemes.

Moreover, in the difficult times that we have encountered, mobile banking made it easier to thrive through the challenges. For example, after the pandemic, 8 out of 10 Indians are now reliant on mobile banking apps. This digital adoption can safeguard people from uncertain times and challenges, even in the future.

With no barriers to location, people can become self-reliant and avail of financial services according to the need of the hour.

Developing Nations are Ahead in Mobile Banking Game

Developing countries have, in a way, outsmarted developed nations in mobile banking development; history is the proof.

Being the gateway to financial inclusion, the developing nations are reaping an infrastructure reliant on mobile banking.

On the other hand, developed nations heavily depend on cash transactions and other safe mediums like cards.

The rock-solid banking framework makes the process relatively rigid in developed nations and less likely to sooner digital adoption.

This is why developing nations are jumping into the bandwagon of digitisation, even before developed countries can plan implementation.

Tie-Breaker Innovations In the World Of Mobile Banking

Starting from NPCI’s person-to-person mobile banking and B2B mobile banking, we have come a long way. Here are the latest innovations to the world of mobile banking:

APIs

APIs, aka Application Programming Interfaces, allow two software apps, systems, and other services, including third-party services, to communicate.

This translates to communication amidst banks and 3rd party products in the banking ecosystem, ensuring utmost security.

Done right, banks could achieve integration between multiple channels, apps, services, devices, and more. This facilitates processes like customer mobile wallets, card systems, 3rd party financial service providers, payment switches, etc.

Instant payments

Real-time, convenient, cheap, and effortless payment services are the hype now, or our way of post-pandemic life. This shattered the rather traditional process of transfer in 3 business days.

In addition, the transaction prompts such as email, push notifications, account updates, and other requisitions are now real-time.

Biometric

Taking extreme security cautions, banks have integrated human physical characteristics (such as fingerprints, iris, and voice) to identify specific customers and their account belongings.

Biometrics is highly secure because there is no downside, such as losing or forgetting passwords. Biometrics are also less easy to crack for hackers and act as the best firewall.

Chatbots, AI, ML, and automation

Gone are the days when customers waited in queues and called to seek their query resolution. Instead, chatbots are built using AI technology to connect with people and provide answers to their queries in real-time.

They are the digital agents deployed at services in multiple channels like websites, live chat, social media, etc.

Banking organisations have leveraged AI and machine learning to aid cost-saving, productivity, and process improvement.

Banking services are now automated, sparing employees the hassle of manual processes. Repetitive human tasks are now delegated to machines and systems capable of doing the job in less time. This makes it easy for both employees and customers with fewer chances of errors.

Data analytics

Banks are the repositories of customer data. They now rely on data collected and sourced through customers to pinpoint preferences and choices.

This makes it easy for banks to offer detailed and tailor-fit services and products to their customers. To attain customer engagement, personalisation is the mantra banks are now operating on.

Is Mobile Banking Free From Any Setbacks?

Unfortunately no, mobile banking has its share of critiques, challenges, and risks.

Mobile banking is the path to financial inclusion, not a solution to financial setbacks. Here are some of the challenges to be aware of:

Infrastructure – Like brick-and-mortar branches, mobile banking relies on telecom operators’ infrastructure. Therefore, any shortfall in the alignment of such operators affects mobile banking services.

Internet connectivity is still a challenge in many remote areas of developing nations, and the success rate relies on internet coverage.

Operational barriers – Security in mobile banking is still a concern for the leaders and users. Mobile transactions are prone to fraud and fall prey to data breaches.

Any shortfall can economically affect either party of the transactions, a significant threat to watch out for.

Regulatory roadblocks – The mobile banking process connected with the risks are still not open for resolution in legal terms. Policymakers and relevant stakeholders can still not find a middle ground where they can agree on constructing parameters that would help build a network or market. The end-to-end process of building a secure gateway of mobile banking is a work in progress with no final layout of approval.

Even with the setbacks, mobile banking portrays a solid blueprint for the facilitation of financial inclusion. The pandemic is the primary driver of this process and is also proof enough for us to incorporate it into our lives. The usage is already widely noticed across all areas of developing nations.

Mobile banking has spun the wheels of change around for the banking industry, taking charge of the driver’s seat. Stay abreast of the mobile banking trends by following Finezza’s blog.

What Is the Difference Between Finserv and FinTech?

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If you’re learning about a new industry, you need to familiarise yourself with the jargon of that industry. The jargon is not meant to confuse you but to help you communicate concepts as clearly and quickly as possible.

Common terminologies have also transformed with the marriage of finance with ever-evolving technology. Two often used terms in the industry that any finance enthusiast or professional needs to know are “Finserv” and “FinTech.” These terms are sometimes used interchangeably, but important distinctions exist between them.

How is FinTech different from Finserv?

While these sound similar, specific points identify the need for two separate terms. To explore the difference, let’s first understand the two terms individually.

What is Finserv?

Finserv is an abbreviation for “financial services”. Essentially, any company that offers financial services is known as a Finserv company. This may include banks, non-banking financial corporations (NBFCs), insurance companies, brokerages, etc.

Finserv is an ancient term used to refer to financial service providers for decades. For example, a prominent financial company in India is Bajaj Finserv.

Finserv is commonly used in the industry to describe any company that provides financial services. Banks that have been around for over 50 years in India are also described as Finserv companies.

What is FinTech?

FinTech is an abbreviation for “financial technology”. This refers to companies that leverage technology to provide financial services. FinTech is a relatively new term that has been around for several decades. FinTech is usually used to refer to tech start-ups operating in the financial space.

Finserv companies use technology in some form or the other. For example, every company uses computers these days, so are Finserv companies also FinTech companies?

The simple answer is “no”. FinTech companies are different from Finserv companies because FinTech companies use technology to disrupt the existing financial space. Using the latest technology means FinTech start-ups can provide a financial service more efficiently or cost-effectively than before. For instance, in Asia alone, more than 2.38 billion people used a FinTech service in 2021.

There are several examples of FinTech start-ups in India, like PayTM, Cred, and MobiKwik, to name a few. In 2021, the overall market size of the Indian FinTech industry was $31 billion, estimated to reach $150 billion by 2025.

The Primary Differences

There are several differences between a FinTech and Finserv company. Some of the most notable ones are below.

Disruptive – Finserv companies have been operating for a long time. They have similar business models that are time-proven. For example, every bank operates in a standardised way, and there are only a few aspects to differentiate one bank from another.

However, FinTech start-ups are defined as new and disruptive. These companies are much more experimental and aim to do business differently by leveraging the latest technology.

For example, the payments space has seen a lot of activity by new FinTech start-ups. These start-ups allow you to make payments digitally simply by using your smartphone without carrying cash or using a debit card or credit card. This is just one of how FinTech start-ups are revolutionising finance.

Scalable – The goal of a FinTech company is to provide services to underserved communities and areas.

Since these companies use the internet and smartphones, they can reach customers that traditional Finserv cannot. With the ubiquity of smartphones in today’s era, FinTech companies can provide their services to a large swath of the population.

Further, since the cost of acquiring a new customer is relatively low, FinTech start-ups can scale their operations very quickly. They may even record high growth numbers in a relatively short period.

Digital – The operations of a FinTech company are digital. Customers can interact with these companies entirely online, and there is no need for a physical presence.

For example, traditional Finserv companies may require you to visit their branch or head offices to do business with them. However, a FinTech start-up has capabilities that allow you to do all your business with them through an app or a website. There is no need to stand in line at an office when dealing with a FinTech company.

Further, FinTech start-ups are leading the way to financial inclusion thanks to digital access.

Lower Cost – Due to the reduced cost of digital infrastructure, FinTech start-ups can offer their services at highly competitive rates compared to Finserv companies. Several FinTech companies even offer a large portion of their services for free. For example, a person does not need to pay anything to use PayTM.

The Future of Finance

It is clear that FinTech is the future of finance. However, this does not mean that Finserv companies will go out of business. Instead, almost every Finserv company is actively working towards adopting technology to offer better and more cost-effective services to their customers.

For example, banks like ICICI have launched their mobile app through which customers can deal with almost any banking operation. Customers can use this app to transfer money, request a debit or credit card, check their transactions, apply for loans, and so on.

FinTech start-ups face tough competition from Finserv companies while encroaching on their space. As the popularity of FinTech services grows, more and more Finserv companies are digitally transforming themselves to stay relevant in the future.

Open banking and automation allow companies to reach more customers than ever before. As of today, there are over 1.7 billion individuals in the world without access to banking services. But with the advent of new technology, the picture is changing for good.

Several global technology powerhouses are also entering the financial space to exploit the financial technology revolution. Even Apple and Microsoft are testing the waters. The day may be close when almost every financial service will be available to everyone at the click of a button on their smartphones.

Wrap Up

Sooner than later, every financial company will become a FinTech company. The road ahead is bright for companies open to leveraging new technology to provide better services. The line between Finserv and FinTech may dissolve soon enough as even traditional companies adopt FinTech capabilities.

If you’re banking online, you should be careful of fraud. Read our primer on avoiding fraud to keep yourself safe while operating in the digital space.

Also, contact Finezza if you’re looking for comprehensive credit assessment solutions. We hope you’ve found our article helpful and informative.