Open Banking and More Fintech Trends to Expect in 2020

The banking sector is perhaps one of the major beneficiaries of modern advances in software technology. Today, payments, accounts and other finances could be easily handled through banking software, mobile banking applications, banking software among other banking solutions. 

We definitely haven’t seen it all yet. In a popular Deloitte study this year, over 28% CIOs reported that they see the implementation of digital capabilities such as banking software, AI/ML-based banking solutions as the most important technology area to be focused upon. 

So what banking software trends are we going to see rise up as we reach near the end of 2019? What type of technology will the top banking software companies work on next year? What will be the new banking software trends in 2020?

1. Open Banking

Open banking is an emerging banking trend that leverages APIs to help users use banking services through multiple online platforms. An enhanced customer experience, better revenue streams for businesses, new service models, these all are some of the benefits passed on to consumers and businesses through open banking. So it is indeed a win-win-game. 

Customer demand today is reaching peaks it never did before. All the innovations we see today come as a result of customer demand. And it was customer demand that made businesses come out of their siloes and collaborate with others to create products and services that are open-source, non-proprietary and do not lock down users into an ecosystem.

The same thing applies to the banking sector too, and that is why open banking is expected to be one of the top banking software trends next year.

2. Voice search in banking applications

Voice-based search in banking software could help customers easily access banking services, provide a new way of encryption, as well as enable communication with NLP-powered voice assistants. 

A report by PwC estimates that the implementation of voice search in banking industry could help save up to $3 Billion!

Voice-based search is gradually taking over traditional text-based search as we speak. According to a report by ComScore, 50% of all searches on the Internet will be voice-based by 2020. The search-engine behemoth Google itself backs up this claim with its own reports, which say that voice-based searches already account for 20% of queries googled by people.

In addition, Voice is also being seen as a better medium for identity verification and protect users’ banking data. Voiceprint technology is one such example. It uses the users’ voices to verify their identity. Mind you, this is totally different from the speech-recognition feature we see in Google Assistant, Amazon Alexa, Apple Siri and the like. To put it in a nutshell, voice recognition identifies “who” is speaking, and speech-recognition identifies “what” is being spoken, regardless of who is saying it. Voiceprint technology is already being used by Citibank since 2016, and the response to the technology is exceptional.

3. We’ll (finally) start seeing the implementation of blockchain on banking software

For the past 2 years, most of what we saw about blockchain applications in banking were concepts, demonstrations, tests, and more of them. A study by Accenture revealed that more than 90% of banks hyping up blockchain are only exploring its usage rather than actually implementing it!

Besides, most banks have actually settled down on using blockchain’s close cousin, Distributed Ledger Technology instead of the former as it's not as decentralized as the former. Additionally, blockchain’s most common, and most obvious use case in the sector is for payments-related services. 

4. AI/ML-based chatbots and automated customer services

One of the most difficult aspects of banking services is those of customer services. Human customer service agents are pressurized to deal with all sorts of customer issues, some of which are seemingly impossible to be resolved timely.

Enter chatbots and automated customer services inbanking software solution. Chatbots leverage the advancements of machine learning algorithms and neural language processing to assist customers in all possible ways. Some of the popular chatbots used by some of the top banks around the globe are Erica (Bank of America), Eva (HDFC Bank), and Ceba (Commonwealth Bank Australia).

A study by Accenture revealed that over 71% of customers would actually prefer chatbot-based customer services over human assistants.

5. Co-browsing

We’ve all have used software such as Teamviewer to help an expert find a solution to problems we face on our computers. Such screen-sharing software though is totally unsafe to use when considering how much access it provides to the user on the other end. 

Co-browsing comes as a solution to this problem. Instead of sharing an entire screen with another user, co-browsing lets users share a specific web page with another person for mutual access. Co-browsing prevents other parties from having complete access to the device. This feature is incredibly useful in banking software, where representatives can assist customers in completing any banking formalities, documentation, among other things that may require support.

Which banking software trend will you catch up to?

The above-mentioned trends in banking are expected to take us further towards evolution in the way software is leveraged by businesses and customers. Open banking, voice search, blockchain, AI-based chatbots, and co-browsing; all of these emerging trends will be developed by businesses with help from the best financial software companies. The question is, which of these are you the most prepared for?