In the digital age, technology is evolving at such a rapid pace that businesses must adapt quickly in order to keep up. Many industries have already adopted these trends and are reaping the rewards of doing so. The finance industry, however, has been slower to change despite increasing pressure from clients and shareholders – but this may be about to change.
For decades, the finance function has remained static. Conventional traditions, complex legacy systems, and tough-to-grasp regulations have rendered financial departments averse to change. But in today’s dynamic business environment, these risk factors can no longer be ignored. Digitalization is disrupting the way businesses operate and forcing incumbent players to reexamine their strategies.
What is Digital Transformation in Finance?
Digital Transformation in finance refers to the use of digital landscape and innovative technology that can lead to successful financial management. The primary objective herein is to streamline processes, enhance efficiency, minimize errors, automate workflow, and overall gain tangible financial gains. And most CFOs that are standing on the corners observing the industry agree that leveraging digital technologies is the only option for cutting costs and keeping up with the competition. At present, it’s not just about digitizing existing processes; it is also about embracing new ways of working and constantly finding new outlets to improve the way people work together.
Top 3 Technologies for the Future of Finance
With the huge amount of data generated every day, it has become imperative for financial institutions to understand what the data actually means. Technologies that sort our data from data lakes bring forth actionable insights and eliminate guesswork all the while empowering stakeholders to make critical business decisions and set trends in the industry.
Artificial Intelligence/ Machine Learning
The collected, sorted, and visualized data will be fed to AI and machine learning algorithms to save time by identifying gaps, make forecasts, warn of shortcomings, and streamline overall processes. AI will do the work that humans cannot do or make up for the time that humans will spend on the task.
Robotic Process Automation
Robotic Process Automation or RPA will help the industry in automating repetitive and tedious tasks. It will also free up the time of the staff, which can be utilized in more crucial tasks.
Altogether, all these technologies will provide financial institutions with digital dashboards, RPA that can make the process quicker, error-less and less time consuming, forecasting and predicting the future with AI including compliance and transparency.
The finance industry is going through a period of rapid transformation. In just a short span of time, we have seen significant changes to the way business is done. Traditional models are being replaced by new ones, and companies need to change in order to adapt to the new environment. As such, FinTech innovations have caught the imagination of consumers and business leaders alike.