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Exponential Technologies Trends in 2020 that will Shape the Future of Finance Industry
Written by Veronica Chiaravalli
Introduction to Exponential Technologies
I recently came across a specialization on Fintech , looked at the contents, and saw a lot of high technologies that even mentioned robots.
The financial services are transforming the way we pay for services and other things.
But there is a lot that we should be aware of and that it is quickly taking place.
Exponential Technologies Trends in 2020 in the Finance Industry
PwC published a report on “Financial Services Technology 2020 and Beyond: Embracing Disruption”.
You can find the report at this website address: https://tinyurl.com/yd6w2c3r
The report raises key questions which everybody should reflect on. It states the following:
This paper complements PwC’s Project Blue
and the PwC Megatrends framework
, which examines the forces that are disrupting the role, structure, and competitive environment for financial institutions and the markets and societies in which they operate. It also continues our series of publications examining the future of financial services, including:
- Retail Banking 2020: Evolution or Revolution? 
- Capital Markets 2020: Will it Change for Good? 
- Asset Management 2020: A Brave New World 
Can you envision branches and operation centres staffed by sophisticated robots instead of human tellers? Or picture everyone from high net worth investors to high school teachers taking financial advice from artificially intelligent apps – and then investing across asset classes, currencies and geographies on a real-time basis? Or imagine if launching a bank, an asset manager or an insurance company was as simple as plugging in an appliance?
 http://www.pwc.com/gx/en/financial-services/ projectblue
I think that there will be changes that we have not forseen as disruption continues to accelerate. There is no doubt that our lives and the way we do things are going to change even more, and that we will have to start to learn about Fintech as soon as possible. We should learn about the terminology and have a general understanding of the latest trends and technologies not only to participate in conversations with colleagues and/or customers but also to make the right decisions.
PwC states that ”It is now becoming obvious that the accelerating pace of technological change is the most creative force—and also, the most destructive one—in the financial services ecosystem today.
The most important takeaways are the following:
The ten competitive technology-driven influencers for 2020
- FinTech will drive the new business model
- The sharing economy will be embedded in every part of the financial system
- Blockchain will shake things up
- Digital becomes mainstream
- “Customer intelligence” will be the most important predictor of revenue growth and profitability
- Advances in robotics and AI will start a wave of ‘re-shoring’ and localisation
- The public cloud will become the dominant infrastructure model
- Cyber-security will be one of the top risks facing financial institutions
- Asia will emerge as a key center of technology-driven innovation
- Regulators will turn to technology, too
This gives a clear overview of the future of financial services and what we should start focusing on. One thing that caught my attention was point 6 that talks abour robotics and AI.
Regarding Aisa, we already see that it is coming up with innovations that are hard to compete with. It raises the question if Asia will become a global leader in the near future.
Now cybersecurity is super expensive and this is something to take into consideration especially for present and future Space projects once Space travel gets a boost and we have more missions going to the moon and Mars.
The report also helps us to prioritize and gives us the following list:
Six priorities for 2020
- Update your IT operating model to get ready for the ‘new normal’
- Slash costs by simplifying legacy systems, taking SaaS beyond the cloud, and adopting robotics/AI
- Build the technology capabilities to get more intelligent about your customers’ needs
- Prepare your architecture to connect to anything, anywhere
- You can’t pay enough attention to cyber-security
- Make sure you have access to the necessary talent and skills to execute and win
As we see, there will be a lot of work that has to do with preparing our architecture. This is an indication that we will need more cloud architects and solution architects, and that it is time to
start looking for the right expertise.
There is an interesting article published on the Medium website called: ”The Future of Financial Services and How to Shape or Face Exponential Changes in Digital Banking and Fintech”:
The author states:
Four types of attitudes in relation to exponential change we are living When we face the exponential change, innovators, technologists and professionals of the financial sector can adopt four main positions respect the “technological change”:
“Change Makers”: companies, departments or people that generate substantial technological changes (evolutive or disruptive), paradigms, products or services, software, algorithms, experiences susceptible to change the model if they are used by a sufficient number of financial companies and / or technological For example, the first models of predictive software, risk detection and fraud based on machine learning and alternative scoring algorithms. Also new payment models, peer-to-peer payments, crowdlending or invisible payments.
“Change Propagators”: thanks to the seed planted by the “change-makers”, they propose a richer model of implementation, integration, evolution, government, etc. They create networks, labs and working groups, improve the initial proposal, generate debate and make it grow by implanting it in their projects and companies and contributing knowledge and experience. They make the change grow: that it reaches further and with more force. For example, the blockchain working groups of Hyperledger, R3, EEA, Quorum, or Kinakuta. Through communities and networks of important players (banks, startups, universities and large corporations), it makes decisions and increases the impact of technology in a specific sector such as finance.
“Change Supporters”: those who support and like a tech change but do not really contribute to its evolution, maturation or its actual application to the industry. Many times they talk about it, they debate, they even give talks and lectures, but they do not stop being fans of the change that simply helps to spread and to be known in second and third rows of actors. Many times, they are not “shapers”, but “speakers”, also needed to share the opportunity and knowledge.
“Change Users”: it’s perhaps the most widespread and probably the position we occupy in most changes that affect society and other industries. However, it is not a completely passive position, since through the use of technologies, as an end-user or as an integrator of the technologies in our products or services, we are generating data and making decisions that will influence how that change evolves. To paraphrase Heisenberg, in a data-driven culture and where machine learning and behavioral analytics are widely extended, the user modifies the technology used (and measured) by the simple fact of using it.
We should focus on preparing a good strategy that will ensure that we remain competitive and can keep the talented people in our organization, because as the demand grows, they will get
offers from other companies and/or competitors.
But that is not all, we should also start getting into these financial technologies now that we have time since everything will be digital.
Yes, we are indeed becoming a new culture and we will not be able to rely totally on others to get things done. So, in short, we will have to continue learning and do it at a fast pace. It is
about theory and practice.
Written by Veronica Chiaravalli