The Digitalization of Finance
Fintech is the technologies that surround and affect financial services, which has been blossoming since around 2010. These technologies have helped financial services become cheaper, faster, more easily available, more transparent, and easier to use. This has led to the creation of tons of new businesses in the field of fintech, and has helped businesses get access to financing that couldn’t have before.
The digitalization of finance has also lead to technologies that bring tons of discussion and debate to the global economic floor, such as a new form of currency called cryptocurrency. Cryptocurrency could in theory replace the physcial currencies of today, and would reshape so many financial businesses, banking especially. While there still is much to figure out about this currency and how to regulate it, this new form of currency shows that the future of finance can change significantly as new technologies emerge and gain traction.
Technologies in Business Finance Today
- Online Banking and Financing: Instead of having to go into a physical space, technology now allows businesses to engage in financial activities online from their own offices. Not only is this convenient for businesses, but it allows financial institutions to help customers in different states. Which has allowed new companies to get into the financial space and deliver services at lower costs due to the reduction in overhead from not having to pay for office spaces in every area they service customers. It also allows businesses to check on their financial records easily online, and gives them the ability to apply for financing much quicker.
- Artificial Intelligence: AI in finance includes chatbots and the automation of financial services. Chatbots can be used in a lot of different fields not just finance, and in the financial field they are able to handle routine tasks to help businesses get the information they need quicker. Businesses are now able to automate parts of their own financial processes as well, such as payroll, accounts receivable, and accounts payble. This prevents human error in making calculations, and increases the speed at which calculations can be completed.
- Blockchain: A new way to store data, blockchain is proving to be a disrupting technology. This technology is allowing financial institutions to create new platforms to service their customers, with new promises of security and integrity. Another thing blockchain is better know for is cryptocurrency, as previously introduced above. While cryptocurrency is not widely accepted yet, many businesses around the globe do accept some forms of cryptocurrency as payment. As regulations begin to further develop for cryptocurrencies, more businesses will begin to feel comfortable with using and accepting cryptocurrencies. Cryptocurrencies will come with many benefits for businesses, which include: accesibility, security, transparency, increase in speed of transactions, and reduction in costs of transactions.