Trust and security.
Expect to hear those words more often as the financial technology - or Fintech - industry grows in Greater Cincinnati and throughout the U.S. This year, we attended Money 20/20, an annual financial services conference that identifies the latest trends in this industry sector. Here are four key takeaways we'll be watching in 2017:
1. Easier access is a must.
We're getting used to instant gratification. You can order the latest bestselling book to download on your e-reader the second it becomes available. With a couple swipes on your phone, a car will show up at your front door and take you anywhere you ask. Twitter breaks news before cable networks have time to catch up.
This expectation of "frictionless" access is coming to Fintech. Consumers expect agile transactions to happen immediately - but they aren't willing to sacrifice security for that ease of use. Fintech services need to be fast and safe - which is a tall order for our current technology infrastructure.
2. Biometric screening will grow.
Grab your smartphone - can you open it with just a fingerprint? That's a perfect example of biometric screening already in your life. Fintech companies are exploring the use of fingerprints and facial recognition software to make single-sign-on easy, fast and secure. The goal is to avoid multiple steps - if your bank app can recognize your thumbprint, you shouldn't have to input your password as well. Your traditional password that's based on remembering a secret phrase is gone - to be replaced by a biometric "password" that you never need to worry about forgetting.
3. Lagging regulation won't be tolerated.
Financial industry regulations are complex and slow-moving - two things a fast-paced consumer just can't stomach. Keep an eye on how rapidly financial regulations may start to change and what that could mean for security. Technology works to make our world smaller, which will be a struggle for local-, state- and country-specific regulatory environments.
4. Fintech goes startup?
Startups are known for big innovations - and fast fails. Today, the best Fintech innovations are coming from the startup world. Big companies can be slow to innovate, but a nimble startup can provide the unique solution that Bigco needs. As companies embrace next-generation Fintech opportunities, they will need to prepare for the startup culture that will likely come along.
Greater Cincinnati has a legacy of strong financial services companies - and an aggressively growing startup ecosystem, making our region the perfect place for Fintech to grow. Want to learn more about what Fintech means for your company? Connect with Kevin Donnelly directly at KDonnelly@REDICincinnati.com.