Big Tech companies’ venture into finance will introduce innovative data-based solutions. Gen Z’s affinity for accessibility and simplicity will find comfort in these ‘buy now, pay later’ initiatives.
These developments won’t completely remove the need for finance professionals; rather, automated workflows and operational efficiencies will allow them to focus more on strategic initiatives.
1. The Impact of Robotic Process Automation (RPA)
Robotic process automation (RPA) streamlines a wide array of digital processes. While its name might suggest mechanical robots, RPA refers to software bots.
Bots emulate the actions of employees using a system’s user interface, performing repetitive, high-volume activities that adhere to rules. They’re perfect for tasks with limited rules or repetitive, high-volume activities where employees might otherwise need to manually complete them.
RPA tools also enable enterprises to quickly deploy integrations that sync data and processes without disrupting underlying systems, helping businesses develop an end-to-end automation strategy more easily.
2. The Role of Artificial Intelligence (AI)
AI is revolutionizing financial processes by automating tasks, identifying patterns and insights, improving risk management, trading communication and investment decisions as well as customer service – providing personalized solutions faster.
AI technology is revolutionizing healthcare by helping doctors detect and treat diseases more promptly. For instance, the Associated Press utilized its AI software to write earnings news stories in lieu of human journalists so they can focus on more in-depth articles.
Generative AI will play an instrumental role in creating an environment of ethical conduct and regulatory compliance while reinforcing corporate governance frameworks. However, to maximize its benefits it’s essential for finance leaders to implement processes suitable for AI usage correctly.
3. The Impact of Cloud Computing
Financial services industry have generally been reluctant to adopt cloud technology due to its potential security implications – after all, this sector deals with highly sensitive and valuable information which makes it an easy target for cybercriminals.
With COVID-19 forcing many companies to shift toward remote work orders and stay-at-home orders, financial institutions quickly adopted cloud technologies more than ever. Cloud provides cost efficiencies by lowering IT infrastructure costs while simultaneously scaling operations during peak periods – while also helping reduce environmental impact by eliminating physical servers via SaaS (Software-as-a-Service), so companies only pay for what they consume.
4. The Impact of Embedded Finance
Emergence of embedded finance has revolutionized how financial services are delivered. Thanks to this trend, nonfinancial companies can integrate banking products such as payments, debit and credit, insurance, lending savings and investment options directly into customer experiences using innovative technologies like application programming interfaces (APIs). Companies looking for new revenue streams are among the primary drivers behind embedding finance services into nonfinancial businesses’ customer experiences.
Embedded financing has long been a staple in consumer transactions with services like “buy now pay later (BNPL). Now its reach has spread into B2B transactions as well, including merchant cash advance and accelerated pay services. For success in this arena, embedded finance providers must offer sales, servicing and program management support for distributors they work with.
5. The Impact of Big Data Analytics
Finance departments are increasingly turning to big data analytics in order to boost financial performance and business development, which requires both the necessary skillsets as well as changes to how a business operates.
Big tech companies have become partners of traditional banks by providing crucial cloud infrastructure and data analytics services. Due to their lack of history baggage, these companies can implement changes more rapidly than their predecessors.
Automation is revolutionizing the Finance function by optimizing workflows and driving operational efficiencies, freeing finance teams up to focus on business insights and providing exceptional service to their customers. Companies who embrace these trends will have an edge over competitors.
6. The Impact of Blockchain
Blockchain and Distributed Ledger Technology (DLT) are revolutionizing finance in many ways. Offering security and transparency, these technologies make them ideal for a wide array of financial services processes.
Data immutability can make data more accessible among multiple parties and reduce fraud and misinformation, while eliminating intermediaries can lower lending and investing costs significantly.
From cryptocurrency revolutionizing payments systems to tokenization enabling fractional ownership, blockchain’s potential is vast. Unfortunately, for it to be effective it requires widespread adoption – something still far off; until that occurs cloud computing, automation, and AI will continue transforming finance functions.
