The Future of Online Banking

by Contributing Author

With the rapid and ongoing changes in the technical field, banks are altering themselves by utilizing technology. Global disruptions of large sectors, such as Covid-19, have driven businesses to adapt their ways of conducting business. People and organizations increasingly rely on digital banking in their daily activities.

With so many digital trends on the horizon or still in the works, it’s easy to discern certain industry favorites. Here are some predictions for the future of online banking.

1. Digital Banking

Digital banking refers to the digitization of financial services to increase efficiency and better serve customers. Customers can transact and get banking services without leaving their homes. Digital banking is the way of the future in the financial industry because of its convenience.

With events like the Covid-19 pandemic, more people are expected to switch from traditional to digital banking. Many people who were previously hesitant to use digital banking have been pushed to do so due to Covid-19-related issues, such as lockdown and social distancing norms. It is expected that more people will join the cause.

The Importance of Cyber Security Will Grow

The relevance of cybersecurity will continue to climb as the number of people using digital banking grows. Banks will make every effort to develop innovative systems that will reduce the danger of fraud and theft. Two-step authentication and biometrics will go a long way toward offering foolproof financial security in the future. More consumers will trust the digital platform with their hard-earned money if it has an advanced layer of protection. For both regulators and customers, privacy and data protection are becoming increasingly important. Banks will have to be more proactive in terms of system security.

Improved Banking Efficiency Using Business Intelligence

Business intelligence integration appears to be feasible in digital banking. It is supposed to provide banks with numerous benefits. Based on historical, current, and future banking patterns, it gives reliable, unbiased, and function-specific information. It will also assist banks in raising their efficiency and enhancing their services while also generating more cash.

Artificial intelligence (AI), biometrics technology, cloud computing, augmented reality, and quantum computing are all likely to play a significant part in the future of banking. These are set to change the way banks provide services as well as how they are delivered and consumed.

A Sympathetic Presence in Customer Service

With the rise of branchless mobile banking, customer service and support will become increasingly important. Customers still need someone to answer their queries, such as how they can refinance student loans, how to navigate invoice factoring for their businesses, and so on, as they get more familiar with digital banking services. As a result, a virtual, 24/7, rapid, and effective customer service system is required.

Fortunately, AI-enabled chatbots can deliver real-time, 24/7 banking services to customers. Because AI-enabled chatbots can answer customers’ questions practically instantly and through a single mobile app, they can boost efficiency by 33%.

Artificial Intelligence (AI)

AI has been an important aspect of financial services over time. For fraud detection, AI and machine learning are essential. When a suspected fraudulent transaction is detected, the fraud detection software used by banks generates alerts.

Banks have reaped significant benefits from implementing modern technology such as AI, which has resulted in cheaper costs and more revenue through many channels. According to a survey from Business Insider Intelligence, banks will save $447 billion on average by adopting AI by 2023.

Chatbots and robots are commonly utilized to streamline client experiences. One common example is the use of AI to assist mobile banking, which allows users to access their accounts at any time of day or night. Financial firms can also use AI to make better lending decisions and risk management. This technology can be used in conjunction with other developments such as RPA, voice interfaces, big data analytics, and so on.

Artificial intelligence is also helping financial institutions improve security and detect and prevent fraud. The technology aids financial institutions in lending decisions and risk management, as well as serving as a platform for additional technologies, including voice interfaces, robotic process automation, and big data analytics.

Blockchain

The sharing economy’s backbone will surely be blockchain. It’s one of the most well-known technologies for ensuring product and service delivery security and accountability. The technology verifies, decentralizes, and cost-effectively examines transactions. It helps with correct bookkeeping and reduces reliance.

Blockchain is one of the financial technology innovations that will support the industry’s two most crucial pillars: trust and transparency.

By keeping all information regarding real-time payments and profile details on different blockchain servers, blockchain works as a decentralized database that helps protect consumers’ personal and financial data. This addresses challenges such as fraud detection and cyberattack defense. The use of blockchain in the credit and lending system will eliminate the need for third parties, making taking out personal loans safer and lowering interest rates.

2. Cellular (Mobile) Banking

Mobile banking is a popular way for consumers to make payments, deposit funds, and track their spending and savings. Because of its convenience and efficiency, mobile banking is preferred by the majority of banking customers.

Savings features and financial health scores are likely to be included in the future of Mobile Banking. It might work with millennials. Furthermore, mobile banking apps are predicted to become far more secure than they are now, as well as more personal and user-friendly. Mobile banking applications are anticipated to give a wonderful user experience to their clients, thanks to innovative technology.

ATM Withdrawals Without Cards

While the mobile banking trend is not entirely new, banks are increasingly adopting it, indicating that it is gaining traction and may be the future of banking. Previously, mobile wallets supplanted debit and credit cards for online purchases, and now it’s their turn to step down at ATMs.

Payments by Voice

Voice-activated instructions have already made an impression on consumers throughout the world, as the voice user interface boosts customer engagement, conversions, and analytics.

Fraud Detection That Is More Effective

As banks and financial organizations increase their revenue and services, they face a significant security risk. Another mobile banking trend, on the other hand, can assist fintech in safeguarding their resources and protecting their clients’ identities. Big data empowers banks and financial institutions to increase risk assessment and streamline client experience while lowering fraud risk.

Conclusion

Tellers gave way to ATMs, and bank branches gave way to the internet, thanks to technological advancements. And technology will continue to play a role in the next round of banking transformation.

If you’ve ever talked to internet customer care, you’ve probably already interacted with artificial intelligence. Who knows, maybe towards the end of the decade, AI-driven bots may approve our mortgages and offer the best private student loan!

One thing is certain — technology, computing, and mobile devices will be a driving factor in banking in the future. And that force shows no signs of abating anytime soon.