The new year will bring significant changes in finance and banking, driven by the convergence of software development solutions advances, changes in customer preferences and an increased focus on innovation. At the center of this transformation is the influence of artificial intelligence, which fundamentally alters the operational landscape of both sectors. To address these changes, we have outlined numerous key trends that will prevail from 2024 onwards.
Key trends in banking and finance
1. Increased use of personal finance apps
The pandemic accelerated the adoption of personal finance apps, with downloads increasing by approximately 90%. With more than 7 billion smartphone users worldwide, these apps offer not only remote money management but also greater access to financing from digital lenders. As Europe continues to embrace open banking, the popularity of financial apps is expected to increase further, increasing opportunities for banks and other lenders to leverage data-driven models to serve growing consumer demand.
2. Blockchain Integration
Blockchain technology is poised for a significant resurgence in 2024 as it is set to become an integral part of traditional financial systems. Major financial institutions such as HSBC, Wells Fargo, PayPal, Mastercard and JP Morgan are actively adopting blockchain for various applications, from settling foreign exchange transactions to automating insurance payments through smart contracts.
As the blockchain continues to mature, it has the potential to transform the way financial transactions are conducted, giving rise to more secure, efficient and interconnected financial ecosystems.
3. AI in financial services
As with enterprise solutions development, numerous financial institutions, such as Bank of America, Citigroup and Wells Fargo, are driving initiatives around generative AI, leveraging technologies such as ChatGPT to improve the customer experience. This trend is expected to lead to innovations such as personalized financial planning and tailored investment strategies based on customer profiles and behavioral data.
In the case of debt management, the impact of AI is already leading to significant change, and we are helping to foster this digital transformation through AI-powered performance. Read our blog to learn more: Maximize ROI: 7 Ways to Increase Revenue in Collections with AI
4. Maximize efficiency through process automation
Thanks to advances in AI, resource allocation and previously labor-intensive workflows will be optimized through technology. Tasks that traditionally required human intervention, such as new customer onboarding, routine transaction processing, invoice submission, and compliance procedures, will increasingly be the purview of AI-powered automation. This change not only promises significant time and cost savings, but also ensures a higher degree of accuracy and consistency.
5. The rise of open banking
The upward trajectory of open banking is on track to continue into 2024, giving individuals unrivaled control over their financial data. This transformative trend is based on the secure exchange of information through application programming interfaces (APIs), fostering a competitive environment among service providers. APIs act as connectors, facilitating seamless communication between various financial applications and paving the way for innovative solutions tailored to individual preferences.
In addition to improving convenience, open banking contributes to financial inclusion by breaking down traditional barriers, allowing more people to access mainstream financial services and participate in an increasingly digital economy. As this paradigm shift unfolds, we foresee a future marked by creative solutions and enhanced security measures.
6. Cloud adoption by banks
The accelerated shift toward digital services, fueled by the pandemic, has led a growing number of banks to gravitate toward software product development services in recent years. This trend is expected to continue beyond 2024, with global spending on cloud services reaching $1.35 trillion by 2027, according to International Data Corporation.
AI-powered chatbots are transforming customer interactions, providing personalized and efficient assistance, while transaction analytics capabilities help improve security and fraud detection. The symbiosis of AI and cloud technologies is thus proving to be a driving force that fosters innovation, improves customer experience and lays the foundation for the next phase of digital change in the financial sector.
7. Greater strength in cybersecurity
The persistent increase in both the frequency and sophistication of cyber threats has propelled cybersecurity to the forefront of operational priorities throughout the growth of digital banking. Addressing evolving data security threats requires a multi-faceted strategy, requiring sustained investment in robust infrastructure and the subsequent development of specialized competencies. This priority is expected to remain ever-present in 2024, with the resilience of cybersecurity measures becoming integral to maintaining the integrity and reliability of digital banking platforms, ensuring that consumers can confidently participate in an interconnected financial landscape. and digitally driven.
The financial services sector is on track to undergo a profound transformation over the next 12 months and beyond, underpinned by custom enterprise software development innovation and evolving consumer expectations. The trends outlined for 2024 underline a shift towards digitalization, changing operational paradigms around blockchain technology and personalized financial management. The critical role of cloud SaaS technology, as well as cloud services, is evident in facilitating this transformative journey.
