• Fintech has been undergoing a continued evolution in the landscape of investment management.
Advanced technology and solution adoption, including the use of big data, AI, and machine learning (ML) to help the businesses in evaluating investment opportunities, optimizing their investment portfolios, and mitigating the associated risks have been clinical in the technology adoption. • The investment advisory services, for instance, are undergoing radical changes with the growth and evolution of automated wealth advisers.
These advisers have the capabilities to assist the investors without the intervention of a human adviser, and can also be used in combination with a human adviser.
It extends the ability to provide tailored, actionable advice to its investors with ease of access, at a partially lower cost. • Further, in the area of financial record keeping, blockchain, and distributed ledger technology are augmenting the AI adoption by creating new ways to record, track, and store transactions for financial assets.
For instance, Sentifi, a Swiss Fintech company established in 2012, uses AI and ML to enable investors and other financial market stakeholders to tap into the online available financial intelligence of millions of persons and organizations. • Furthermore, asset management companies can gain substantial benefits through the adoption of AI and ML.
These technologies can help provide real-time actionable insights and facilitate portfolio management decisions.
Sub-sets of AI can empower asset managers to streamline processes to optimize investment decisions and processes. • In October 2019, MDOTM, and Raiffeisen Capital Management, one of Austria's largest fund managers, announced a new strategic partnership.
With this new initiative, the range of Raiffeisen Capital Management's sustainable funds would be used by MDOTM to provide to the market SRI investment solutions that benefit from the efficiency brought by AI technology in portfolio construction. • Moreover, In May 2020, Boosted.ai, the prominent distributed ML platform for global investment professionals, announced the closing of a USD 8 million USD Series A financing round.
Boosted.ai would use the funding to continue improving Boosted Insights, its proprietary ML platform that empowers portfolio managers, analysts, and chief investment officers (CIO's) to augment their existing investment processes, source new ideas and manage risks Financial inclusion that would enable customers to leverage benefits from the financial system is the ultimate goal of FinTechs.
Fintech companies are under constant pressure to search for new opportunities to provide better financial services to the customers.
But, providing the customers with a breed of tech-oriented financial services wasn’t enough in a market where banks were dominant.
They lack the popularity, trust, and capital that banks had.
So they turned to what they had at their disposal, data, a competitive resource.
They started analyzing data from browser specifications, transaction histories, images, voices, other unstructured data, data through applications, and geolocation.
But Fintechs weren’t any more limited to legacy systems, pivot tables, and spreadsheets for data analysis.
They found out the key ingredient that would create an impact in the financial sector by solving the challenges and complexities that people had faced with banks.
Artificial intelligence is solely responsible for innovations in data analytics and product development in FinTech and the finance industry is driven by potential opportunities that help it to grow.
So, it is worth investing in such an impactful technology in FinTech.
Marketing a new business is difficult whatever the service or product you're trying to supply.
Making your voice heard in noisy marketplaces and prying customers away from established brands is a first hurdle many well-meaning enterprises never overcome.
Imagine then how hard it is when your new business provides a service which involves the handling of people's personal finances.
To say the challenge is intensified, is somewhat of an understatement. Undeterred by this reality, new banks and fintechs are emerging and many of them are doing rather well.
A common thread amongst those new-starts enjoying successful beginnings is an approach to marketing their brand which deviates from the conventional.
Marketing has always been an organic, fluid process in a constant state of evolution, adaptation and flux.
Resisting change is a sure-fire way for companies to find themselves in the wake of their competitors.
What the likes of Starling Bank and AccessPay are showing us is that, though the channels we use remain fairly constant, how we use them changes all the time.
Fintech companies have taken the world of payments and finance by storm, proving themselves capable of directly competing with their more-established bank counterparts by offering new ways to access and use cash through non-physical means.
The ongoing coronavirus pandemic has further driven the shift to contactless payments in Asia Pacific as consumers see it as a more “hygienic” way to pay.
Other fintech sectors are also ramping up their offerings.
Despite their rising popularity, fintechs face tighter competition as more and more fintech companies emerge every year.
Singapore alone now has around 500 fintech companies calling the island their home, and more are likely to emerge in the coming years.
Traditional banks are also determined not to be left behind, and have rolled out online banking services and even their own digital banks.
With these in mind, Asian Banking & Finance spoke with fintechs and marketing leaders to learn how fintechs can better improve their marketing communications and strategies amidst tougher competition.
A Shift from Face-to-Face to Digital Engagements Customer interactions are shifting from face-to-face engagements to digital interactions—an area where traditional banks have struggled.
According to a recent Keypoint Intelligence – InfoTrends report, almost half of all banking and financial services firms agree that their current technology stack for customer communications is not well-suited for implementing a digital experience strategy.
While traditional banks are often burdened by legacy systems, documentation, and practices, FinTech firms are more agile and focus primarily on the digital experience.
These firms are experiencing widespread success because they target specific financial offerings that are typically underserved by banks.
They improve the process altogether by offering an excellent user experience as well as employing sophisticated marketing tactics.
As a result, banks are falling behind on the digital side of the equation, and third-party firms are taking advantage of this shortcoming.
Using social media in a regulatory environment Getting to grips with the risks of social media is one thing, but how can businesses and organisations use it in a regulatory environment? As a starting point, a normal requirement across financial services, energy, healthcare and the public sector is that businesses or organisations must be able to archive, capture and make e-discoverable all business records.
A business record is defined if a company answers “yes” to any of the following questions: • Does the information or the data support a business activity of some sort? • Is it required by a statue of regulation? • Does it have any business, legal, historical, operational or regulatory value to the company? • Would it be kept if it was in a paper format? • Could it be used to help resolve any future disputes? A business record can involve any channel including instant messages, collaboration tools, social media or even email.
This will become even more important as the Security and Exchange Commission (SEC) continues to enforce more regulations on maintaining all communications and social media posts.
In fact, the SEC already requires investment advisors to report all social media accounts – including corporate and individual business-related profiles.
This requirement opens its firm up to even more scrutiny.
The current issue with financial service providers is that their customers want them to communicate to them via social media, but they are scared of saying the wrong thing.
While there’s no official guidance on what to say from the regulators, anything a financial institution posts can be heavily scrutinised and subjected to any of the said laws.
On the other hand, regulators have warned financial institutions that they need to be careful about what’s being said about their brand on social media too.
So, they must have a presence in some shape or form, leaving them often feeling like they’re walking on eggshells when communicating.