The State of FinTech in 2020
While digital transformation initiatives have been climbing the FinTech priority list for years, Eli Rosner of Finastra notes that thanks to COVID-19, “It feels like the fast forward button has been pressed.” Firms must now embrace the realities of remote work and rising consumer expectations even as investor patience wears thin on reliable ROI.
The result is a FinTech landscape that’s more than meets the eye. To deliver on transformative deployments, companies must look past familiar fintech trends to uncover key challenges, assess acceleration issues, and recognize the realities of digital revolution.
The Challenges of Change for FinTech Companies
FinTech solutions emerged as harbingers of change. Frustrated by restrictive policies and cumbersome processes, financial technology companies embraced the market reality of application-driven enterprises capable of meeting consumers on their own terms. But even these tech-first solutions couldn’t predict current challenges. As noted by recent Deloitte research, FinTech firms now face both external and internal barriers to effective change.
Externally, investors remain an ongoing challenge as their patience for digital revenue delivery wears thin. While they recognize the need for transformative spend, they’re not willing to wait years on steady returns. Internally, lacking enterprise agility now hampers the ability of finance technology firms to deploy new partnerships and coordinate digital innovation at scale. Changing market forces are creating unprecedented challenges for FinTech firms.
The Acceleration of Adoption
Even as enterprises grapple with evolving change frameworks, the global pandemic continues to push companies out of their comfort zone, forcing firms to quickly implement multichannel solutions capable of connecting with customers anywhere, anytime. Consider that 35 percent of banking customers have embraced more online options, while contactless credit card payments have jumped by 40 percent over the past few months.
In effect, the COVID-19 crisis has revealed a need for speed that’s far beyond the comfort zone of many FinTech firms. The result of this adoption acceleration is equal parts potential and problem. Companies can’t afford to slow down, but need a better view of what lies ahead.
The Realities of Revolution
To overcome emerging challenges and embrace agile application adoption at speed, FinTech firms must leverage a two-step process that first recognizes the real-life impact of digital revolutions and then deploys specific solutions to improve operational outcomes.
In practice, this means addressing four new realities:
- Customer-First Frameworks
As noted by Deloitte, the shift to customer centricity is often viewed as an enabler. If companies are able to deliver seamless, client-first experiences through common digital channels, they can significantly raise their reputational stock with consumers. But it’s one thing to recognize the reality of customer-first frameworks and another to implement them at scale. Here, fintech firms are best-served with workflow automation tools capable of streamlining key processes — such as loan applications and credit checks — to help reduce the time between customer inquiry and response.
- Complex Document Functions
With clients and staff now working and interacting remotely, FinTech firms are facing a substantive uptick in the volume and variety of digital documents they receive — and they need to process ASAP. Here, complexity itself doesn’t represent the full spectrum of change, since regulatory and compliance controls are familiar challenges for FinTech companies. Instead, it’s the velocity of complex document processing that can quickly overwhelm even experienced FinTech software as they look to process applications and approvals at speed without sacrificing security or consistency. Comprehensive, industry-compliant document management tools can help FinTech firms bridge the complexity gap.
- Comprehensive Data Foundations
Spreadsheets remain essential for traditional firms and FinTech solutions alike. As data volumes grow, organizations face issues related to information-entry errors, version consistency, and data security. To ensure foundational finance data is accurately collected, consistently applied, and always protected, FinTech solutions need to deploy next-generation spreadsheet solutions capable of giving end-users the control and security they need.
Collaborative FinTech Forces
To deliver on client expectations around speed and security, FinTech solutions require SDKs that natively support document collaboration and control without introducing security risks such as unauthorized editing, downloading, or sharing. This means equipping their applications with the operational infrastructure that facilitates everything from editing and commenting to robust redaction, annotation, and file conversion.
FinTech in 2020: The Only Constant Is Change
The global business landscape in 2020 has been anything but predictable. Defined by pandemic pressures and driven by increasingly sophisticated digital initiatives, FinTech companies have managed what seemed impossible only a few years ago. They made a speedy shift to remote work that now delivers rapid customer responses while reducing overall risk.
However, it’s important to note that the market movement isn’t over. As COVID conditions continue to evolve and consumers recognize the value of advanced FinTech solutions, the only constant in FinTech industry this year is change.