Sep 17, 2015
Since 2008, investments in financial technology have nearly tripled over time. The industry has grown substantially, such that nearly half of all of London’s work force is employed by a fintech company at some level. Fintech offers solutions for finance that big banks simply cannot respond to, and these will be some of the hottest trends in the coming years.
Machine Learning
Machine learning isn’t necessarily a new concept (algorithm trading has existed for many years now), but it has grown substantially as our understanding of AI has evolved. Machine learning now powers much of our fraud protection efforts, and provides consumer finance advise through so-called “robo advisors”.
Perhaps one day, machine learning will truly offer real-time financial updates that banks can use to improve their services.
Crowd Funding
Another major change to the world of finance is the idea of crowd funding, and peer to peer loans. Banks aren’t equipped to take the time to underwrite and serve these kinds of loans. Certain high risk business proposals are better suited to a crowdfunded effort, where investors without large cash reserves can contribute to helping a product get to market.
Crowdfunding in the future might see groups of individuals banding together to buy commercial real estate, or to help startups distribute their goods in a brick and mortar store.
Crypto Currency
Crypto currency is a new idea that seeks legitimacy. The most popular form is called “bitcoin” and it’s an anonymous transaction that is publicly recorded on a ledger. The currency is a new form of exchange bordering on the experimental, and it’s generated a lot of hype behind the idea. One potential application, which has the potential to lower capital costs for banks and businesses, is transmitting money across international borders. As we become a globalized workforce, crypto currency may provide a better solution to pay workers what they’re worth.
Bio: Firoz Patel is a leading executive behind AlertPay Inc. Firoz Patel is a globally recognized name in the ecommerce space, and he currently oversees development of the Payza platform.