7 BFSI Trends in 2022: Big Data, Blockchain, and More

Traditional banking practices in the Banking, Financial Services, and Insurance (BFSI) sector are currently obsolete. These processes are time-consuming and require a lot of manpower to complete. The key to maintaining BFSI services at the customers' fingertips is digital transformation. In 2022, online and net banking has become a popular way of prioritizing health and COVID 19 pandemic issues.

In 2022, the BFSI sector will observe 7 major technology trends to look forward to as follows:

1.    Intelligent Communication and Decisions

The value of applied analytics, artificial intelligence (AI), and data is at an all-time high right now. Identifying and refining prospects for innovation, as well as improving assistance, decisions, and contextual communications. New-age advanced algorithms and AI provide suitable knowledge of industry events, allowing staff to achieve continual development of operations and supply the highest value-added services by making the right decisions.

2.     Connected IoT infrastructure

The BFSI industry is looking to promote the incorporation of the Internet of Things (IoT) as a major technology integrated with next-level AI and Data Analytics. The interconnected framework of IoT devices aids in automating the essential business proceedings, information sharing, and effective communication. The capability to transfer ownership, manage financial requests, and remote procedure execution. Analyzing client data makes forecasting customer requirements simple. It leverages the level of security, profitability, and energy efficiency.

3.     Blockchain incorporation

The digital banking revolution is being fueled by blockchain. According to an analysis, blockchain investment in financial and banking services will reach $17.47 billion by 2025. It establishes a transaction ledger that is easily accessible and tamper-proof for all users using encryptions and complicated algorithms.

Advanced cryptography is used to record the transaction patch into data blocks for payment disruptive innovation. These are secure because they are locked and chained. It addresses successful cross-border transactions by creating a worldwide network that is potentially transparent and cost-effective. It improves the efficiency of banking and financial activities, such as money transfers, KYC streamlining, claim processing and sorting, and many other things.

4.     Cybersecurity focus

Cyber threats initiate dreadful financial upshots and jeopardize the future business prospects and reputation of the BFSI institutions. Hacker attacks have become more vulnerable as a result of the rising usage of online data transactions and mobile technology. The average cost of a data breach in the BFSI sector is $5.85 million.

To deal with the pandemic, financial institutions rushed to integrate the remote working paradigm, and this is where the major damage occurred. To deal with the epidemic, financial institutions rushed to integrate the remote working paradigm, and this is where the major damage occurred. Password elimination via authenticator apps such as SSO solutions and Windows Hello is a new trend that is gaining acceptance in the BFSI sector. It will add a second layer of biometric security and protection.

5.     Big Data personalization

In the BFSI sector, Big Data is an emerging technology trend, and institutions are investing more in these platforms and API integration to lead to digital banking growth. Big data computation and storage offer tailored, convenient, and secure tasks. Big data manages the particular company processes as well as the overall financial service transformation in this approach.

The use of big data to drive revenue growth scopes by assessing credit information, spending patterns, social media metrics, and financial situation is a crucial component of technological innovation.

Using big data analytics, 71% of BFSI businesses gained a competitive advantage in the market.

6.     Artificial Intelligence and Chatbot

Artificial Intelligence (AI) and chatbot applications are becoming more prevalent, assisting clients in dealing with their needs through self-service paradigms. The businesses are able to provide 24/7 customer assistance while reducing human resources. It generates rapid and immediate solutions for addressing queries and improving the customer's personal banking experience. Personalization lowers financial risks by spotting unusual actions and frauds, allowing analysts, investors, and accountants to produce better work in the future.

7.     Robotic Process Automation (RPA)

RPA is another popular technology for automating backend office activities in the BFSI industry, such as security checks, customer onboarding, mortgage processing, and credit card processing, to name a few. Banking and financial firms are increasingly using RPA to complete operations more quickly and efficiently, as well as to save money and improve organizational efficiencies by allowing workers to focus on the most important aspects of client care.

Conclusion

The BFSI industry expects to confront challenges in meeting changing client expectations and achieving the push for adaptability and innovation. As per anticipation, digital techniques will bridge the gap between radical and conventional systems in banking and financial operations by leveraging data security, customer experience, and operational fluency.