Thursday, September 28, 2023

The rise and evolution of fintech after Covid

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Shreya Christina
Shreya has been with for 3 years, writing copy for client websites, blog posts, EDMs and other mediums to engage readers and encourage action. By collaborating with clients, our SEO manager and the wider team, Shreya seeks to understand an audience before creating memorable, persuasive copy.

Liana Zavo is a publicist, PR media mogul, author, impact speaker and founder of ZavoMedia PR group, a global PR agency.

The dawn of a new industry reveals how the world is constantly evolving to keep up with the times. Financial technology, or fintech, is disrupting the traditional methods of the financial industry and challenging corporate giants that once dominated the mainstream. This revolutionary movement paved the way for innovations that seemed impossible decades ago, but here we are, witnessing many breakthroughs that make our lives easier. Even before the pandemic, fintech became a part of our daily lives. It added flexibility to our financial ecosystem, which impacted how we budget and bank, shop and dine, trade and invest, and pay bills. Without it, we might have to wait in line for days or weeks for our financial transactions to be processed, hampering our efficiency.

For the past four years, I have worked as an investor and strategist with several fintech companies to help them navigate the new digital market and boost their reputation. Working closely with them provided an in-depth look at how they dealt with challenges, especially after the pandemic changed the business landscape. During Covid-19, the fintech industry greatly evolved to meet people’s banking needs while staying safe at home.

While most experts warned of a downtrend, the fintech industry surprised everyone with its successful turnaround. In this article I discuss how the Covid-19 crisis has contributed to the rapid transformation of fintech and what I can expect in the coming years.

Fintech and the boom of e-commerce

During the first lockdowns, the world realized the need to increase the digitization of financial services. Between January and June 2020, the global traffic in retail e-commerce increased by 35.5%. Everyone quickly became familiar with online shopping, from essentials like groceries and appliances to aesthetic needs. Contactless payments and mobile banking became the new norm for helping people stay socially distancing.

Two years later, global markets have reopened and embraced the new normal, and fintech has remained a vital backbone as many countries had already adapted to the functionality and sustainability it offers. To remain competitive in this arena, small to medium-sized enterprises and retailers must reinvent their business model by developing an online presence and incorporating fintech.

Increased Demand for Cyber ​​Security

Contrary to what analysts predicted about an imminent slump in digital investment, the pandemic has pushed more people to participate trading and investing apps. This interesting hub helped fintech thrive and produce even more exciting ideas to empower the industry. Now we live in a reality where because of fintech companies need less personal interactions, labor intensive methods and energy consuming processes. However, the ability to provide secure transactions and ensure that consumers feel protected anytime, anywhere should be a priority for businesses around the world, as the digital border can be vulnerable to cyber-attacks.

Fintech companies providing cyber protection have had incredible success since the start of the pandemic. According to Crunchbase, $21.8 billion was invested in cybersecurity in 2021, a record. This points to a trend where investors are becoming more informed about the importance of building digital defenses. As the pool of online customers grows and the fintech industry continues to grow, it is imperative for all businesses to invest in cybersecurity.

The cryptocurrency wave

Undoubtedly, fintech’s biggest impact on financial services can be traced back to the ledger technology that made cryptocurrency a blockbuster. The rise and explosive growth of cryptocurrency has attracted attention as more people invested in bitcoin and other cryptocurrencies, even while the world was in lockdown. Nine Pioneering Fintech Companies Focusing on Blockchain and Cryptocurrency Found Their Way to the Fintech 50 list.

Despite concerns that cryptocurrency is risky and volatile, more and more crypto buyers continue to emerge, prompting the financial sector to adapt. El Salvador is a perfect example, as it recently became the first country to make Bitcoin legal tender. As the history of money enters a new chapter, there has been mixed reaction to collaborations between traditional money systems and digital funds. To address this problem, many countries are exploring the possibilities of Central Bank Digital Currencies, who seek the balance between continuous innovation and sound policies to achieve stability.

A glimpse of the future

With an estimated global market value of $5 trillion and experts forecasting growth of more than 23% over the next five years, it is becoming clear that the pandemic has proved beneficial to fintech’s success and even accelerated its development. As paper-based payments and manual transactions move to paperless and automated processes, technology has the upper hand in solving numerous problems with speed, accuracy, security and convenience. This progress and success amid the pandemic crisis make it clear that the influence of fintech will not stop anytime soon.

My advice for businesses is to keep up with fintech trends and explore financial strategies that align with your company’s goals. Keeping an open mind is a critical step in helping companies survive in this ever-changing industry. Business Council is the leading growth and networking organization for entrepreneurs and leaders. Am I eligible?

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