According to a survey by McKinsey, the organisations that were most successful in dealing with the pandemic were equipped with a variety of technology-related capabilities, with 67% being more advanced in using technology than their peers before the crisis.
According to a survey by McKinsey, the organisations that were most successful in dealing with the pandemic were equipped with a variety of technology-related capabilities , with 67% being more advanced in using technology than their peers before the crisis. They were also able to respond 20-25 times faster than expected to a range of COVID-19-related changes, like digital payments and lending. Digital transformation was the game changer for these organisations, including their ability to quickly adapt to financial technology.
Adoption of fintech should be a strategic priority for governments, banks, commercial businesses and consumers globally. It promotes sustainable economic development by giving easy and affordable access to financial services to remote and previously marginalised sections of society. There are certain key requirements common to all commercial businesses, that are becoming more achievable with fintech:
Regulatory Approval: Fintech have the ability to bring governments, central banks, regulators, and financial service providers together on a single platform . This makes it easier for them to collaborate and develop policies and standards that are more practicable, progressive, and in tune with consumer needs and demands, adding to profitability and time and cost savings for commercial businesses.
ESG: With the deadline for Sustainable Development Goals approaching in 2030, it is urgent for governments and commercial businesses to rapidly adapt to variables such as financial inclusion, climate adaptation, and sustainability . Fintech tools provide an easy solution to remodel a commercial business to one that conforms to such parameters.
Innovation: Innovation is an umbrella term that extends to elements such as customer satisfaction, cost and time efficiency, and competition. While it is possible that one might accidentally trade-off one element for the other, fintech makes it possible for commercial businesses to deliver well in all areas.
With consumer, corporate and political needs changing rapidly, commercial businesses are advised to respond proactively to these changes by adopting fintech tools to help them innovate and lead their business through these transformative times.
According to the European Commission, 90% of jobs will require digital skills in the future. Not only is the adoption of fintech crucial for commercial businesses, but it is also an opportunity to capitalise upon. Fintech tools and technologies, such as Cloud services, and AI amongst others, introduce operational processes that benefit all:
Digital Sandbox: A Digital Sandbox provides a controlled and secure environment for commercial businesses to facilitate evaluation of their products and services with synthetic data. Such simulation tools and tests are good indicators of how a particular product or service would perform in real-time. It also helps to detect and respond to vulnerabilities and errors that might pop up.
AI: With AI, businesses can automate and optimise routine processes and make them time and cost-efficient. Decision-making based on cognitive technology outputs is also faster and more efficient.
Cryptocurrency: Cryptocurrencies enable secure, simple, and real-time money transfers. Capital management is made more transparent and transactional charges are significantly reduced for cross-border transactions. Cryptocurrencies also give lending opportunities to small businesses with low credit scores.
Cloud Services: Cloud Services provide scalability through additional storage space, computing power, and virtual resources whenever a business needs it. With data and information as the fuel for the Fourth Industrial Revolution, cloud services capitalise on the spectrum of underlying data and shared resources.
Buy Now Pay Later (BNPL): BNPL is an effective strategy to invite and retain customers. In 2020, BNPL accounted for 2.1 % of all e-commerce transactions and is expected to double in 2024. This benefits customers as it is simple, easy to do, and most importantly, light on their pockets. While the businesses benefit with an ensured and consistent cash flow, a high number of purchases, and a good market and customer share.
Web 3.0: Web 3.0 is a decentralised version of the web, that operates on Blockchain technology. Web 3.0 provides features such as interoperability among platforms, enhanced privacy, and data security that makes it more desirable for users and businesses.
Presence: Fintech empowers businesses to be present and dominate the game with negligible or meagre physical presence requirements. Most fintech tools can be used via third-party service providers with adequate expertise. This cuts down the infrastructure/resource investments required by commercial businesses.
Partnerships: For countries and businesses that lack the adequate institutional capacity to assemble an appropriate framework for the adoption of fintech, co-development is a unique opportunity. It establishes an ecosystem to nurture and incubate new ideas, bring in funding, and scale successful technology solutions rapidly, with processes as simple as API integration.
The newly evolving fintech ecosystem has players from traditional banking and financial services to big techs, trying to carve out a niche among their consumers, budding businesses and millennial customers by integrating finance to technology and assisting them in navigating through major financial decisions. To be a successful ecosystem player, it is necessary for commercial businesses to explore avenues for expansion while consolidating one’s core business.
Fintech empowers commercial businesses with the adequate and multivariate tools to take care of this while giving utmost importance to innovation, efficiency, and customer satisfaction. NayaOne is assisting banks, financial service providers and other organisations in their journey by providing Fintech-as-a-Service, Digital Sandbox and many more offerings that are of value in today’s tech ecosystem. Get in touch with us to help us serve you better!