Has COVID-19 dented the trends?
What among the challenges populations face the most daunting when hit by a crisis? The answer is financial services.
Socioeconomic resilience resides in accessible financial services to spur market regrowth from crises in any era. Today, revolutionary innovations and advancements in information and communications technologies are facilitating the delivery of financial services most especially to those who are considered vulnerable, underserved, and unbanked sectors of society that form the majority of the population. Financial technology, or fintech, thus, makes financial accessibility more convenient and secure, and a lot less expensive to all.
But promising as it is, fintech is still being challenged from mainstream adoption in vulnerable communities that are figured to benefit well from it. General acceptance by the sector remains remote due to less socioeconomic resources and opportunities. They are not
well-informed and are less educated about what financial products and instruments can do to offset the dire status of most. The result is that they will not bother to seek financial information.
New Normal Lifestyle
The Global Fintech Adoption Index of 2019 recorded a doubling of fintech adoption every two years with a growth from 16% in 2015 to 64% in 2019. It was due to fintech’s agile character that left legacy financial institutions struggling to cope up and personalize the services fintechs were thriving upon. When the pandemic struck in 2020, fintechs took to the uptrend quickly as businesses clung to it for survival by maximizing Internet use for digital payments. Consumers, too, adopted the digital payment trend rather forcibly as they were looking for alternative solutions to the brick-and-mortar lifestyles they were used to before the pandemic.
Now that populations are adapting to the new normal way of standard living, fintech solutions have become a welcome lifestyle offering inclusion, sustainability, and most especially, the convenience that is expected to bring fintech beyond the reasons of its present adoption.
Rising Demand for Contactless Payments
The pandemic dented the trend for contactless payments from survival to convenience, whereas before, was just an option. Avoiding the threat of contracting coronavirus, contactless payments spiked as online shopping and food deliveries were the main ingredients of remembering 2020. The exposure to this kind of convenience is attracting more consumers to adopt contactless solutions beyond the pandemic.
To Serve the Underserved
To be able to cope up, traditional financial institutions are looking to partner with fintechs for the final inclusion of the unbanked and underserved communities, a major sector of society of 1.7 billion adults who little or no access to banking and financial services as basic as having no bank account. With fintech’s mobile apps, any individual can now open a bank account, have access to loans, avail of credit cards, pay utility bills, trade, buy or sell crypto, open multiple crypto wallets, and a whole lot of other financial processing conveniences. This is to say that the funds belong to authentic owners following simple and quick steps of KYC procedures.
From Threat to Partner
Instead of banks looking at fintechs as threats, fintechs can actually serve the digital needs that banks by themselves will have a difficult time maintaining due to cost, tech equipment, and personnel expertise.
AIs, machine learning, and deep tech are fintech solutions that are defining the future of finance. Given that the pandemic seems to take longer to be solved, fintech solutions are imperative solutions to keep societies and economies thriving via efficient financial systems amid physical distancing and strict health protocols.
Age of Millennials
Even as the older generations control much of the world’s natural and created wealth, sooner or later, millennials will be taking over a wide range of responsibilities from corporate to political. Long before the pandemic struck, millennials were already tech-savvy and their longing for better digital solutions to their everyday needs can be reflected by the way they change gadgets from time to time between short periods. they always go for seamless digital experience in financial encounters and online transactions. They are seen to be adept with investments and trading, and therefore, should be looked upon as fintech’s present and future users. Legacy institutions, as have said, should find the solutions to cater to the demands of the next generation of consumers.
Fintechs, being the frontliners in keeping up with the demands of contactless transactions, in huge part because of the pandemic, must not only address the demanding efficiency of financial systems but must also be part of rebuilding a sustainable environment as their sensitive and conscious answer to the threats of climate change. The growing concern of populations to the protection of the earth and its environment, and a healthy lifestyle, will look to partner according to the advocacies of fintech firms. Ecofriendly, hygienic, and health programs count much to loyalties customers are ready to give, support, and uphold that will spell responsible fintech firms’ sustenance for years to come.