Banking
Fintech Growth Strategies That Impact the Future of Banking
Over the past few years, we have witnessed phenomenal growth in fintech startups, and this trend is likely to continue. According to a report by the Boston Consulting Group (BCG) and QED investors, financial technology revenues are expected to reach a whopping $ 1.5 trillion by 2030. However, the ride for fintech is not as smooth as it might seem from these numbers. The fintech and banking industry has its own set of challenges to overcome to thrive in a dynamic and competitive market.
Challenges facing fintech and banking companies
Fintech and banking companies have to cope with challenges like:
- Providing hyper-personalised experiences
- Ensuring compliance
- Data privacy and security
Customers today demand an experience tailored to their needs. Fintech and banking service providers need to ensure that they provide personalised experiences to their customers else they could lose their customers to competitors.
Technology is an integral part of the fintech industry and service providers can leverage technology to offer personalised experiences to their customers. The fintech and banking service providers must leverage robotic process automation (RPA) in order to automate manual processes and enhance their speed and efficiency. This helps minimise delays in service delivery and boost customer experience. Artificial intelligence (AI) systems collect and analyse vast volumes of data from multiple sources to provide insights about customers. Fintech teams can create marketing strategies according to the specific needs of their customers. AI-based chatbots resolve customer queries as and when required by customers.
The fintech industry has to ensure compliance with several regulations. These regulations are not constant but are updated from time to time. Hence, keeping pace with these changes and ensuring compliance is a challenge for the fintech industry.
Deploying a single unified platform helps fintechs ensure that they remain compliant at all times. These platforms automate processes like securing consent, providing legal closures, etc. This streamlines processes, reduces errors and mitigates risks while reducing costs as well.
The fintech and banking industry works with sensitive data that is vulnerable to cyber threats like data breaches and fraudulent transactions. Hence, fintech service providers need to ensure that they have robust cybersecurity systems in place. Cloud-based contact centre solutions help protect sensitive data by providing a multi-layer defence network managed by security experts.
The fintech and banking industry needs to identify and deploy the best technologies to overcome challenges such as these. Overcoming such challenges sets the stage for building a fintech growth strategy.
Developing a fintech growth strategy
- Leveraging data analytics
- Targeted marketing
- Risk mitigation and compliance
- Scaling operations
- Collaborating with a fintech partner
Data is the key element for the growth and success of a fintech business. Data analytics tools provide insights into customer behaviour, preferences and market trends. By analysing data, fintech companies can make informed decisions and optimise their products and services. Therefore, investing in robust data infrastructure and analytics tools can help businesses uncover patterns and trends, detect fraud and offer customised products/services to their customers.
Attracting new customers and retaining existing customers is the most important factor for the growth of a fintech company. This can be achieved through targeted marketing campaigns. Data analytics provides customer data that can be used to build targeted marketing campaigns. Marketers can create customised marketing content that resonates with their audience. They can advertise their products and services on appropriate channels to connect with their potential customers.
To retain their existing customers, they can ensure effective communication channels and offer them products/services tailored to their needs instead of offering generic products.
Fintech companies must ensure that they have robust compliance frameworks and implement effective risk mitigation strategies. They should conduct regular audits, adhere to data privacy regulations and implement strong security measures.
Fintech companies must ensure that they have scalable systems, processes and infrastructure that foster growth. AI and automation technologies streamline processes, enhance efficiency and reduce costs. Scalable and cloud-based solutions are effective in managing the increasing data volumes and user traffic.
Collaborations with fintech partners who are experts in the field drive growth. You can outsource your fintech needs to a banking business process outsourcing partner. Your partner manages end-to-end services for your business. Outsourcing helps you benefit from the experience of your partners in the field. Modern-day banking process outsourcing partners leverage automation technology to streamline processes.
By outsourcing the day-to-day management of your workflows to an experienced fintech relieves you of routine tasks. You can channelise your time and resources toward developing effective growth strategies for your fintech company.
Final takeaway
The fintech industry is ridden with several challenges that impede the growth of fintech startups. A fintech company must build an effective roadmap and leverage cutting-edge technology to foster growth and success.
How can Infosys BPM help?
Infosys BPM offers Business Process Outsourcing (BPO) banking services to meet the needs of fintech companies. We provide specialised services that help fintech and banks transform their operating models and streamline processes while reducing costs and delivering enhanced business value.
