The entire banking industry is standing on the brink of change, with many trends being predicted to take over the industry in 2018 and beyond.
In 2018, banking is predicted to get smarter, more personalized, more secure, and more convenient for the customer. As 2017 is on its way to departure, we list the upcoming trends that are being predicted for 2018 in the banking sector.
1. Mobile banking applications on the rise:
Mobile applications are gaining traction as a means to interact with the world. When considered in banking industry, mobile applications could become the principal way for customers to interact with their banks. These mobile applications may or may not be developed and maintained by the banks.
Using these apps will reduce customers’ visits to the physical branches of banks, and therefore give customers more and more independence and flexibility over their finances. With mobile wallets cropping up left, right, and center, many are also predicting the complete disappearance of cash. Banks who are planning to surf through this change need to be masters at integrating their systems with highly interactive technology. According to statista.com, 89.9% of the millennials are familiar with and regularly use mobile banking, and other generations are also catching up fast.
2. IoT enabled voice commerce:
With interactive technology progressing at the rate it is, it is not difficult at all to imagine a world where everything runs on voice commands. This trend will also extend into the banking industry, with voice commerce coming into the limelight. Imagine a world where everything around you are equipped with your very own voice assistant, or even better, various devices having multiple voice assistants interact with each other to provide you with a seamless experience.
If you bring banking into this picture, you can buy any product/commodity by requesting the same to your assistant, who will use your linked bank account to make the purchase and confirm the transaction. Later, the products can be delivered to your doorstep. This year, Capital One began testing applications using Cortana and Alexa, hopefully they will be coming out with something by next year. Another way that voice control can be used is as an additional layer of security. There are many banking institutions which are experimenting in this aspect as well.
3. Blockchain steps into the real world:
For those who are not yet aware of blockchain, it is a technology that is used by many globally connected computers to supervise the database that takes care of every Bitcoin transaction that is happening. Blockchain is the decentralized authority that manages Bitcoin.
Blockchain is finally ready to step out of controlled environments and into the big world. We are already seeing traces of this happening, and it is only going to get more omnipresent, from derivatives to online money transfers. Forbes has stated that 45% of institutions such as stock exchanges and money transfer service providers suffer from some or the other kind of economic fraud. With its decentralized database, blockchain aims to eliminate such economic crimes.
4. Applying virtual reality to banking:
Virtual reality has the potential to perform wonders in the banking industry. All these possibilities are just the tip of the iceberg when it comes to the partnership between virtual reality and banking.
VR can provide a new pathway of communication between a client and a banking institution/adviser to appease the need to transform the way banks and customers interact with each other, including finding advisers, collaborating with clients, and much more.
5. Cognitive Banking is rapidly growing:
The increasing number of users that digital transactions have in today’s market leads to a mind-numbing amount of data. Every user will have their own set of data which will keep increasing in volume with time. When looked at from the perspective of a bank, such huge amounts of data need to be properly managed to gain invaluable insights from it. This is where cognitive computing steps in. It aids in sorting through the data and finding out the important or relevant data while tossing away the other unnecessary data.
With the introduction of AI into the picture, banks are slowly moving toward cost-cutting procedures to maximize their efficiency. Using AI and cognitive computing in the banking industry also aids the customer relationship management aspect in a huge way, since these technologies are self-learning, meaning they don’t need to be updated with every new change, and they can also be used to empower staff to cater to customer requests in a much more satisfying manner.
These are simply the most important predicted trends that are expected to take over the banking industry in 2018. The banking industry is changing rapidly, and these trends are the proof for it. They will definitely influence the way that financial institutions and leaders shape the future of the industry. Banks that fail to act and adapt to these upcoming trends will find it very hard to stay afloat in the current of change that is sweeping through the industry.