Financial Software Solutions | Changes and Trends in 2021

Financial Software Solutions | Changes and Trends in 2021
Financial software development is on the rise because of the major shift to online transactions in 2020. What trends dominate financial software solutions in 2021? Below we highlight some of the most prominent ones.

Artificial Intelligence and Machine Learning

There are a lot of ways to use artificial intelligence (AI), machine learning (ML), and deep learning (DL) in the process of creating compliant software for financial services. In 2021, these technologies are in use because of their affordability, an abundance of beneficial use cases, and because they meet the expectations of modern users.

Below are some of the relevant cases for using AI and ML in financial management software development.

  • Better security. Fraud prevention and detection is a top reason AI and ML are used in the financial industry. The rise in e-commerce in 2020 has also brought on an unprecedented rise in financial scams. Due to the heightened awareness of the need for data protection, financial companies are paying even more attention to security this year.
  • Ultimate data analysis. Financial analytic software is mostly powered by AI. In response to the increased use of online financial services, banks are more reliant on data analysis to understand their users better and develop relevant offers.
  • Predictions and risk management. Making accurate predictions is one of the most significant features of artificial intelligence. Financial modeling software is an opportunity to build risk management models and better respond to market changes in this period of uncertainty. Financial models software is also an option for loans and investment management.
  • Customer experience improvement. The use of chatbots and voice assistants is already a well-adopted practice in fintech, and most companies and their customers would like to have them available.

Open Banking API

Open banking application programming interface (API) is another trend in financial software solutions in 2021. Open banking provides an opportunity for third-party companies to safely receive and process customers’ financial information shared by banks and financial services.

Despite the fact that this approach has received some criticism, it is still marking a new era for the fintech market. Creating financial solutions and sharing open banking APIs provide an opportunity for banks to reach out to more customers, increase their revenue and stimulate innovative development.

Biometric Technology

Biometric identification is one more trend in financial software solutions development in 2021. It is also another example of machine learning utilization in the sphere of fintech development. Fintech software powered by fingerprint, face, and voice recognition is powered by artificial intelligence.

Experts also expect a decline in the development of biometric identification systems that require scanning a fingerprint. It is one more requirement of the current global health situation, which has triggered a demand for contactless biometric identification solutions development.

Voice Recognition Technologies

While voice technologies are also a part of the user identification process, the modern generation of financial software solution users expects this feature to be more interactive. For example, Generation Z is already used to managing their smartphones via voice commands, and they expect the same experience from the financial companies they do business with.

Banks and financial companies have to think about making their applications more interactive and adding features for voice management, especially if the younger generation is a target audience.

Robotic Solutions

There are also a lot of ways to use robotic solutions for fintech software development. They are also powered by artificial intelligence and machine learning. Robotic solutions are used as part of financial reporting software, financial analysis software, and tech-driven customer service. However, people expect automated processes to become more available to ordinary customers in the nearest future. They'll get an opportunity to manage their finances, make investments and develop smart money management strategies with the help of AI-powered chatbots coming as one of the features of their mobile financial software solutions.

Internet of Things

The Internet of Things (IoT) is already here. In 2021, more IoT devices are paired with financial services software to allow people to make instant purchases and transactions. For example, a smart refrigerator created by Samsung has a built-in function that allows the owner to make grocery orders, pay for them and get them delivered right to their home. It is the result of the Samsung and Mastercard partnership. It is also an example of how the Internet of Things and open banking can work together.

Blockchain, Cryptos, and Smart Contracts

When blockchain first appeared, experts spoke of it as a decentralized technology that could destroy the banking system. However, financial companies decided to make friends with this potential enemy. Blockchain technologies are currently being used by banks and financial companies as a way to enhance security and improve transparency.

For example, Mastercard announced its decision to start working with Wirex and BitPay, and launch crypto cards that will allow users to pay for goods and services using cryptocurrency as simply as using fiat money. Inspired by MasterCard, large and medium-sized companies will most likely also begin to implement the use of cryptocurrencies in their financial software systems.

As far as smart contracts are concerned, they are a great way to automate most banking processes, and in 2021 we will see the broader application of this technology in financial services software solutions.

Conclusion

The sphere of financial software solutions development is quite dynamic. Companies strive to create top-notch solutions that will simultaneously meet the needs of the global economy and fit user expectations. It’s a good practice to use trending approaches as they provide a competitive advantage. However, they must always be backed up by a real need, thorough market research, and strong technical expertise.

Cprime Studios can become your tech partner on the way toward cutting-edge custom software development for the financial market. Contact us to find out more about the benefits we can deliver to your business!