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4 Ways Technology is Transforming Financial Services

Banks and insurance companies have relied on the same business models for decades. Technology has affected the industry in a few ways, such as computer spreadsheets replacing paper ones. However, the rate of change in IT and customer expectations are driving massive change in the financial industry. For example, we’re seeing mobile payments websites and peer to peer lending websites hitting the mainstream and becoming a viable alternative. Here are four ways technology is transforming financial services.

The Rise of Alternative Lending Arrangements

While many people still apply for a home loan or credit card from their bank, you have far more options than were available just a few years ago. You can refinance your debt or get funding for a new venture via a loan through a crowdfunding site. The internet also makes it possible to apply for loans with alternative lenders.

For example, you can now easily access bad credit loans online through direct lenders and brokers. Some even offer both sources of capital through a single portal or app. The application can be approved in hours or even minutes, and the money could be in your bank just as quickly.

Or you can simply ask for donations to pay for expenses. This is true whether you’ve suffered a tragedy or are seeking money for your new business venture. In the latter case, you might incentivise the donors by offering them one of the first working prototypes off the production line or just give them branded swag.

The Impact on Insurance

The insurance world has started to change in the face of decentralization, and the consumer market is also evolving. For example, people serving ride-sharing app customers can buy insurance by the kilometre to have commercial vehicle insurance only when they have a paying fare. Insurance is having to adapt to provide coverage for other services offered through the sharing economy like renting out your house for the weekend via a rental site.

On the flipside, advanced sensors and smart tech allow for closer monitoring of assets and actual risk. Car insurance companies are starting to offer insurance based on your actual driving habits. A device plugged into the car tracks how hard you accelerate and brake and where and when you drive. This can reduce your insurance rates if you’re a safe driver, and the data it collects may be invaluable in defending you in an accident claim. Other devices track the location of vehicles, allowing trucks and cars to be recovered as soon as they’re reported missing.

Health insurance companies are asking people to track health and workout data via wearable computers. Wearable sensors can report when someone has passed out from heatstroke or a head injury. Insurance companies incentivise the adoption of this technology to reduce the risk of having to make payments.

The Impact of Artificial Intelligence

Artificial intelligence is affecting everything from rapid A/B testing of marketing content to providing smart search engine results. It is being used to mine social media comments to read social sentiment in real-time. It has led to robo-advisors offering financial advice to clients of major investment firms and monitoring of financial data for small advisors. It is being used to streamline infrastructure, connect buyers and sellers and monitor for fraud.

ConclusionTechnology is Transforming Financial Services

Technology is revolutionizing every aspect of the financial world. It doesn’t just alter how we interact with institutions or streamline back-office processes. It has opened up the financial and insurance market to new players and resulting in brand new services to meet customer needs and wants.

Can You Stop Technology from Becoming Disposable?

Keeping up with the rate at which technology is evolving is not an easy task.

It is becoming impossible to own the latest phone, laptop or MacBook because a newer version is always just around the corner. Technology is therefore fast approaching the point of becoming disposable. Because of this, people are taking less care of their technology, safe in the knowledge that they can just replace it with a newer model.

Even quick and easy fixes have become too much hassle; something as simple as replacing a worn hard drive and recovering the data on it will be too hard for some people who will swiftly decide to abandon the perfectly serviceable machine in favor of purchasing a new one. This is a costly and wasteful solution.

If you have a quick trigger finger when it comes to abandoning your tech, follow these 3 steps to hopefully stop you from throwing out another laptop this year:

  • Protect the Outside

We take our tech everywhere with us: when we’re on the go, they are constantly shoved in and out of our pockets or bag. This makes breaking them an unfortunately common occurrence and phone screens are the main culprit. In America alone, more than 50 million phone screens are cracked over the course of a year. Getting yourself a screen protector and a case for your phone is such a simple and obvious tip. Protective cases are easy to come by and can save you from replacing your screen every time your phone fall out of your pocket.

  • Protect the Inside

Malware and viruses are not new, but as technology evolves, so do they. Simple changes in the way you protect your sensitive data can stop your computer from getting hacked and destroyed from within. Change your passwords regularly: having the same password for everything might be a helpful way for you to remember, it but it also puts your security at risk. Be sure to include numbers, upper and lower case letters and make it a minimum of 9-letters long.

  • Make Do and Mend

No longer just a phrase for darning your holey socks, mending your technology is the best way to stop you from having to shell out for something new. Is your laptop two years old and the hard drive has started making unusual noises? Don’t automatically assume the worst. Firstly, hard drives have a longer life than most tech users assume, and secondly, there are services such as Secure Data Recovery Services that can assist you in solving the problem.technology Disposal

Technology doesn’t have to become disposable. In a climate that is currently focused on becoming — and remaining — sustainable, the rate at which you use and dispose of anything, including tech, will become crucial. Is it vital for you to have the latest phone model when yours still performs perfectly well? Have you protected your laptop from anyone snooping on the public Wi-Fi? Simple and basic prevention can go a long way.