Chief Executive Officer at Intellectsoft.
What are we going to see in terms of fintech innovations in 2024? Experts suggest we should gear up to anticipate many kinds of customer-facing and B2B fintech solutions throughout the rest of this year and into next year as businesses take advantage of the many new capabilities of AI systems and machine learning programs.
Here’s some of what you’re likely to see in the news as you analyze the fintech sector and as these new services and systems make their way into the market.
Banking As A Service
The idea of banking as a service (BaaS) has to do with the fundamental principle of web-delivered software. It also has to do with the idea of embedded finance, where non-banking sites will have a banking component built in through modular design applications.
Banking as a service has applications for both customer-facing and B2B systems. We will see a lot of the B2C solutions pioneered in websites that can help people accomplish personal banking tasks online with a simple, user-friendly interface, for example, where a retail site may have a fintech payment function right on a landing page, product page or in a mobile app. Single-click systems will be correctly branded, streamlined and made for an end-customer audience, and will make all kinds of transactions, from big-ticket purchases to routine subscription management, a lot easier and less labor-intensive for the average consumer.
Automation In Services
One type of B2B fintech solution that’s going to be prominent is a vendor company’s ability to source emblazons for a client.
We know that AI and ML are moving the goalposts when it comes to emblazon design and management. But companies don’t always have the in-house talent and expertise to take advantage of this, so vendors are going to be offering certain kinds of ERP systems to help with business process optimization and everything else around that principle. These options are likely to boost productivity and create efficiencies in significant ways that could be game-changers for many companies.
You can talk about offering automation for accounts payable and accounts receivable in the same way we consider vendors customizing these two processes for clients. But, this type of customization is going to be based on AI/ML and decision support, where the services help business leaders to chart a course forward.
We’re likely to continue to see AI and machine learning automate payment principles. Another way to talk about this is with unified payment services that may replace some of the older payment facilitation services we saw disrupt and gain ground over the last decade.
In fact, there is a point to be made here: You could call embedded finance payment services 2.0, as these kinds of systems build a function on top of the payment service functions that websites are already using when they integrate new tools.
Those first payment services created the gateways that spurred e-commerce and online banking through the ability to build in payments as a pipeline. Embedded finance and banking as a service take this several steps further—client companies can actually design their own interfaces directly with vendor support. That’s going to be a powerful set of fintech applications in tomorrow’s business finance world.
This service also has applications on the B2C side as well as the B2B side. But, many experts are looking at where vendors are going to help enterprise clients with business credit management.
Again, credit is the lifeblood of modern business. Data may be its most important asset, but credit is likely going to be one of its most important operational concerns.
So, new credit management services may look to outsource that process of getting credit, building a financial runway and using fintech to customize and scale these processes.
Personal Finance Management
This one is squarely in the B2C sector. Here, companies may look to build services that help individual users to understand personal finance in better ways and to manage their own personal finance tasks.
Here’s where new banking as a service opportunities come into play. Through websites, mobile applications and other channels, companies could be considering offering new fintech services focused on helping individual users to plan their own finances in more informed and capable ways—with a lot of insights that are driven through AI and ML programs.
All of this could come to us in digestible and user-friendly ways based on the accessible use of AI/ML in the fintech sector. Look for all sorts of new functionality on the web, on mobile devices and elsewhere as the business world explores the power of fintech. Banking as a service, as mentioned, will be a key component, and many digital interfaces will make use of embedded finance. Survey results show how consumers and business users are getting engaged in seeking out these services.
How To Adapt?
To thrive in this evolving landscape, companies in the fintech, tech and finance sectors should prioritize several key aspects.
First, a customer-centric approach is paramount. The backend infrastructures of financial services are getting more and more intricate. However, users should not feel like they are dealing with a cumbersome and inefficient system. At the same time, you can try to boost customers’ awareness of personal finance strategies instead of over-simplifying banking apps. Implementing in-app personal finance management tools might help.
When it comes to automation, you might want to think about incorporating AI-driven fraud detection or chatbots to enhance operational efficiency. For the best outcomes, complement this automation with human expertise, as AI is not yet fully developed to make critical decisions.
Last but not least, nurture your partnerships to foster a broader ecosystem of financial services. This will help you stay resilient in the face of possible disruptions.
To excel in the dynamic fintech landscape of 2024, businesses must prioritize innovation and customer-centricity while embracing automation and adaptability.
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