Despite holding the capability to deliver unique & new innovative solutions to the financial sector, Fintech companies are amongst the worst affected industry players amidst the pandemic. The impact of COVID-19 remained severe and interrupted the smooth flow acquired by some major Financial Technology giants.
While the pandemic has taken a toll on the economy, there lay equal opportunities, especially for Fintech companies, to come out of the hole and seize the day presented ahead. The demand for contactless payments has seen a surge and provided fresh opportunities for Fintech companies to successfully cater to consumers’ changing needs.
In this article, let us discuss the new and improved opportunities for the companies.
What is the New Normal for Fintech companies?
Prior to the pandemic, most Fintech companies faced the challenge to spread enough awareness so that consumers choose to rely on digital platforms rather than physical banks. Hence, the financial technology sector remained in the developing stage.
Amidst the pandemic and the enforcement of lockdown in the fight against coronavirus, a boom in digital payments was evident. On the brighter side, most Fintech companies have started to leverage their unique & disruptive skills to embrace the financial sector’s technological shift. Based on CNBC’s study, digital payments are likely to reach a mark of 726 billion by the end of 2020. That is indeed a massive high!
Today, consumers are more likely to purchase through online payments as a result of safety measures. Hence, small and big businesses are rebooting the payment modes to digital, whereas Fintech companies are taking significant steps to meet consumers’ new demands. Contactless payments being the new normal for Fintech companies!
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Top New Opportunities for Fintech Companies
Save recurring costs via remote working- While the Fintech companies have ensured close interaction with the clients & the consumers for better building relations, the new normal of remote working has proven to be a challenge.
However, it is an ideal opportunity to control office spending as employees would be working remotely, and hence, they would not be utilizing resources offered at the workplace.
Besides that, similar to social events organized for building close relations with the investors or communities, there is an even better possibility to gather individuals through online webinars, live Q&A, and spread technology awareness. Exactly what you had wished for in the past!
An increase in demand for mobile app payments-Vikas Bansal, director at Amazon Pay earlier, shared his inputs on customers relying on Amazon Pay for major transactions. To acknowledge an ever-growing demand for purchasing groceries and other essentials online, PhonePe has enabled the local businesses to sell its products through PhonePe’s virtual stores.
Hence, the Fintech companies are also engaged in responding to the newly emerged need for Fintech payment apps. The government is highly discouraging people from using cash in response to the social distancing norms. The contactless payment solutions are seeing an unprecedented boom.
Strengthening customer relationships- Amidst the challenges, the pandemic has brought a new opportunity for Fintech companies to shift working style based on the customer’s needs. While coping with a customer’s changing demand, various Fintech companies have modified their policies to ensure customers receive a proactive response.
They are quite involved in utilizing Artificial Intelligence and other disruptive technologies to deliver superior customer experience along with a safe environment.
What are the areas that require further improvements?
Data Privacy & Security:
Data has been of great concern since the time the digital revolution began in the world. Amongst all, Fintech companies tend to hold a large amount of personal data in terms of credit card details, bank account numbers, and social security numbers.
This kind of information is considered highly sensitive, and hence, it is the responsibility of companies to ensure the data is not compromised. In the past, we have heard instances where hackers compromised personal information in huge amount despite the robust algorithms.
With users turning to digital platforms to share such sensitive information online and make purchases, the challenge falls upon Fintech companies to secure the provided data & information.
Personal Touch Without The Human Touch:
It is evident how successful Fintech companies have been in implementing advanced technologies for seamless transactions. For years, these companies have made efforts to lure customers to digital payment transactions and remained in tough competition with traditional banks.
However, with a lack of human touch, it is critical to maintaining trust so that consumers are not reluctant about online transactions. A few experienced Fintech companies have acquired the new interaction method through webinars, personalized emails & messages, and online gatherings. The other remaining companies are in a continuous huddle to maintain close relations with the customers despite human touch’s unavailability.
Rethinking Revenue & Expenditure:
The inevitable economic slowdown has affected the Fintech companies and has created a new challenge to manage resources. Remote working has provided relief and allowed companies to save money on unavoidable expenses.
Major Fintech giants are rethinking on their expenditure and cutting down on resources. While the period of COVID-19 has caused a boom, Fintech companies are also remodeling business to withstand the economic pressure. An increase in demand for contactless payments has created room for more employees to handle an overload of online transactions.
The world is certainly in the process of recovering from the crisis COVID-19 gladly bestowed upon us. Major industries remained affected and saw a shift in the economy. Similarly, despite holding strong technological skills, Fintech companies were greatly affected and struggled to stand still against the slow economy.
What comes as a surprise are the opportunities the crisis has brought ahead for these Fintech companies. They have adopted a new approach and are working towards fulfilling the new demand for contactless payments.
More customers now prefer contactless payments over visiting a bank or an ATM for money related requirements. Each major store or a shop has embraced digital existence and catering to their customers’ new demands. Fintech companies are finally a step closer to make customers tech-reliant.
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