During the 19th century, gangs plundered banks and disrupted the financial sector. During the 20th century, males dominated the segment, and a few lone women upset it. In the present century, it is digital technology that is disrupting the financial world. In this write-up, we take a look at the leading challenges that this year has brought about in the finance service industry.
• From 2017 to 2018 the number of breaches faced by financial companies jumped by 480%. When even a single attack impacts thousands of citizens and costs millions, it is imperative to find a solution. Therefore, fighting cybercrime is the biggest challenge the industry has to handle. The one answer that is slowly becoming apparent is Blockchain. The new technology is emerging as the leading solution.
• The second obstacle the segment has to hurdle is the regulatory compliances. Each year, the regulations modify. While some new ones are added, others are removed, which makes it hard for service providers to keep up. There is a need for fintech solutions that make addressing compliance issues simpler and more straightforward.
• We know big data is transforming businesses. In the finance world, it is no different. By knowing what the customer wants socially, economically, and politically, financial firms can serve them better. Moreover, they can do so while preserving their interests. The challenge here is to sort through the massive piles of data that connected devices provide and interpret them correctly. Thankfully, right now, many data analytics technologies are working on risk management, asset management, and other areas of finance.
• Artificial intelligence has already altered the manufacturing industry. It is now moving towards finance. Some solutions that AI offers finance are:
o Customer verification
o Open banking
o Automated wealth management
o Alert on suspicious activity on accounts
AI and deep learning technology are boons to the financial sector. The test is knowing how to utilise the power of AI without any drawbacks.
• The final obstacle the financial service industry faces this year that we discuss is customer retention. With firms popping up at every corner, competition is fiercer than ever before. Yes, the customer is somewhat loyal, but it isn’t enough. They are ready to switch to a provider who is cheaper and more beneficial. To truly tackle the situation, businesses need to offer a more personalised service with easier and automated access.