Lots of different financial technologies look set to change the way we live our lives, buy products and services, and do business in 2024. AI has had a massive influence on finance in 2023, and this looks set to be the case next year too. Some modern solutions have even helped people with bad credit to get financial help. Artificial intelligence (AI) and machine learning (ML) technologies have been used to identify reasons to trust consumers who have been turned down by major banks. BadCredit.co.uk allows people with poor credit the ability to find a good deal without a credit check.
In this guide, we’ll tell you about some of the major trends that we expect to see reshape the financial world over the coming twelve months.
Let’s take a look at five of these right now.
Contents
1. Fintech and generative AI
Fintech is a financial technology that gives people a greater level of power over how they manage their money. Generative Artificial Intelligence is used by finance companies to spot errors, detect fraud by identifying unusual financial patterns, and improve customer service through deep learning. Generative AI-powered chatbots have been playing a much greater role in fintech recently. They enable people to communicate with their banks and other financial service providers to get the information they need without speaking to another human being. Many banks have incorporated a great deal of generative AI into their businesses. In 2024, it’s likely that more and more people will benefit from bespoke financial planning and investment strategies that have been generated by AI. These will largely be based on what financial organisations know about customers and their behavior.
Although some people have criticised banks for using chatbots, they do offer some benefits. They can give customers the help that they need around the clock so they don’t have to wait to get the information they need, they can provide up-to-date information on balances and guide people through many different banking processes.
2. Sustainable Technologies
Businesses from all sectors are now under pressure to act more sustainably, and banks and other financial companies are included in this. More and more financial institutions are now investing in green initiatives. These can include recycling and using renewable energy. Many customers are now choosing which financial companies to work with by looking at what they are doing to cut their carbon footprint. More and more sustainable financial products are being made available. These reassure customers that their money isn’t being used in a way that hurts society and the environment whilst it’s with their banks.
Just two examples of sustainable financial technologies and products are renewable energy funds which are used to invest in solar projects, and TreeCard. This is a service that helps people to track their carbon footprint and make eco-friendly financial choices. Banks are also becoming more sustainable by promoting digital payment solutions. Digital payments are eco-friendlier than older payment methods including cash and credit cards because they mean physical cards and paper receipts don’t need to be produced.
3. Cryptocurrencies
Cryptocurrencies haven’t been in the headlines as much as they were a few years ago, but they are enjoying a big resurgence, especially now Bitcoin has recovered from its Covid-era crash. More and more investors are showing a new interest in crypto, and many members of the public from outside the finance industry have been able to make big gains after investing.
If you’re not quite sure what crypto is, it’s a digital payment platform that means you don’t need to carry physical cash. Crypto is mainly used for online transactions, but you can use it for physical purchases sometimes. There are many different forms of cryptocurrency on the market, with the best-known including Ethereum and Bitcoin. However, many lesser-known coins are starting to show a lot of growth and could deliver big gains for people who invest early. Crypto is now regulated by the Financial Conduct Authority in the UK, and any gains that you make are taxable.
4. AI-backed insurance solutions
As AI is so good at identifying patterns in data, a larger number of insurers are set to offer bespoke insurance products based on risk. A recent RSA Insurance study found that 70% of respondents were in favour of using AI. Almost half acknowledge the benefits, and four out of five responders said AI was already being used in at least some of their daily activities. Some of the benefits respondents highlighted included using chatbots for quick customer support, automated claims processing to cut processing times, analytics for accurate risk assessments and bespoke policy recommendations.
5. AI fraud detection
Cybersecurity looks set to be a huge concern for the financial industry, with cybercriminals and financial organisations both looking for ways to make sure AI works for them. In order to stay one step ahead of cybercrime, financial companies will need to carry on investing in skills and resources. Experts say that 14.3% more will be spent on security and risk management globally compared to 2023.
It’s also thought that there will be more use of stablecoins in 2024. A stablecoin is a kind of cryptocurrency that’s linked to a stable commodity like gold to prevent the volatile rises and falls we see with many other cryptocurrencies. Many global brands including MoneyGram and Western Union have been offering stablecoins to customers hoping to transfer money around the world without being hit by big value changes.
Conclusion
2023 has been a year of big change in the finance industry, and many of these changes are down to AI. It’s always wise to keep up with the latest changes in financial technology so you can make the best decisions for you, save money and keep it safe plus benefit from the best and most innovative financial services. Technology is evolving all the time, but understanding the way it works, what the risks are and how it can benefit you can help you stay in a good financial position.
Although change can be daunting, many fintech solutions are making life much simpler for consumers. Mobile banking, contactless payments and other modern solutions have made it much easier for people to manage their money over the past few years. These solutions can help you save time and remain in full control of your money no matter where you are in the world