The financial technology or Fintech market is expanding with new, innovative businesses improving banking and financial services like never before. According to the Market Data Forecast, by the year 2026, the fintech market will reach a market value of $324 billion at a compound annual growth rate of 23.41%.
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As the industry continues to grow steadily, the fraudsters are also evolving at the same speed, making it difficult for financial institutions to implement the best tools and protect their company and customers.
Digital Trust and Safety on Fintech Platform
Due to the financial institutions not implementing tools quickly, customers remain sceptical.
As reported in the BIS survey of May 2021, US households state they trust traditional banking institutions more than Fintech to protect their data. Hence, it becomes essential for the FinTech industry to bridge the trust gap and secure people’s data.
Trust: FinTech’s Undeniable Asset
Thinking of Fintech, technologies like Big data, digital ID, and open banking are the first things that come to mind. These tools facilitate new opportunities for digital transformation in the financial sector. But getting people to try out the products designed using these innovations in Fintech requires their trust.
Besides, the trust gap can occur at any level in the digital banking ecosystem, i.e., between users and platform, platform and sectors, or sectors and tech providers. However, and as from the stat mentioned above, it is clear that consumers trust traditional banking more than fintech institutions, making it essential to approach Fintech solutions holistically.
Designing Your Solution in Fintech
Before designing a solution for your Fintech business, you must understand whether the user experience you are offering resonates with people on a rational and emotional level. If the fintech product you provide is meaningful, then how you ensure credibility and functionality, added by your technology partner, will signal trust.
To merge trust into Fintech products, each stage of product development, such as user experience, critical feature development, business analysis, etc., should have a trusted foundation.
Risks in Fintech for Consumers
There are many dangers for customers in the fintech industry. These dangers can be broadly be divided into compromised data security, and the use of non-transparent data to both regulators and consumers.
Undeniable is the loss of privacy, rising fraud and scam risks, discriminatory uses of data analytics, and consumer behaviour manipulation.
These situations risk entering the financial regulatory space with bare minimum operational knowledge.
One of the significant risks for consumers will be privacy and data security loss.
The loss of privacy and data security are intertwined and lead to different concerns based on the data that is being accessed and how sensitive the information is.
Banks are already at the risk of data breaches due to siloed IT systems.
The growth of these activities created the phase of “Crime as a Service” that playoff technology built based on SaaS. […]
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