Top 5 Trends Currently Driving the US FinTech Industry
The financial technology sector has been one of the fastest-growing industries in the US over the last decade. Every now and then, we see new solutions come up, all with an aim to solve current and future financial problems and make it easy to pay for products and services and transfer money.
The last few years in particular have had a focus on various financial areas, and we’ll explore the top 5 FinTech trends you should watch out for. The article is based on our interview with online casino and tech expert Bernard Maumo from OnlineCasinoRank.
Blockchain Financial Solutions
Blockchain technology has grown tremendously over the last several years, and lots of FinTech companies are now using it to come up with many varied solutions. The basis of the technology of a secure distributed ledger opens a wide range of possibilities, some of which have now become mainstream. The first of them is of course cryptocurrency, which provides users with a more private and anonymous mode of payment. It is now one of the most popular casino deposit options and is accepted by most online businesses.
But crypto is only the basic product of blockchain. The technology has opened up a new world of Decentralized Finance (De-Fi). This system takes advantage of the fact that the blockchain doesn’t need central institutions such as banks and offers reduced costs, transparent transactions, and accessibility. Through the technology, users can lend, borrow, trade, and earn interest on their crypto assets all without a central financial institution.
Open Banking
Another trend that has been widely embraced in the country is open banking. While it has existed for some time, it has only become popular over the last few years as financial institutions have recognized the potential it carries. Basically, open finance allows financial institutions to share customer data with authorized third-party FinTech institutions through an API (Application Programming Interface).
This makes it possible for FinTech companies to create innovative products that address various user needs. For example, users can aggregate their financial data from different accounts and create an overview of their finances. This trend has opened a myriad of opportunities for FinTech companies, and it’s greatly boosting customer experience.
Embedded Finance
Another trend that will only get bigger is embedded finance, which is all about integrating financial services into various other digital platforms. This trend is based on the fact that today, we have lots of services that can be done online, and if you can pay for them without having to go to a different platform or have cash, the better. To make this possible, non-financial digital businesses now offer financial services as part of their ecosystem.
A good example is that you can pay automatically when you take an Uber or Lyft. When buying a Tesla, you also won’t need to contact a broker to get insurance, as there’s an option embedded into the purchase. Maumo, whose website lets you explore various online casino deposit options, adds that Buy Now Pay Later (BNPL) is also currently being adopted at a very fast rate as a part of embedded finance. The model allows customers to defer payment for goods or services purchased online or in-store.
AI & Machine Learning (ML)
AI has been the talk of the town for the past year or so, and when combined with machine learning, it offers lots of opportunities to the FinTech industry. These two technologies are being implemented by almost all financial institutions to help analyze huge amounts of data. While it has long been used to come up with meaningful insights and improved decision making, the use of AI is now being taken further.
The technology is making it possible to analyze unstructured data through AI. It therefore helps factor in data that a bank wouldn’t typically use in conventional credit scoring and fraud detection. The two are also being used for customer service through chatbots.
Digital-Only Banks
The new generation just wants to do everything on their phone, and this has resulted in one of the most transformative financial systems – Digital-only banks, otherwise known as neobanks or challenger banks. These are financial institutions that offer virtual banking services such as P2P transfers, international remittance, and online payment services. These Fintech solutions have become quite popular as they eliminate the need to go to a physical bank, wait in long queues, and fill in tedious paperwork. This need for convenience will continue fueling the FinTech industry and lead to even more inventions.
