Advantages of FinTech applications for financial institutions

Fintech
Friday, April 16, 2021

Advantages of FinTech applications for financial institutions

Due to their innovative and attractive services based on new technologies, FinTechs stand out as great allies in the market to increase competitiveness and efficiency in the financial sector.

Due to their innovative and attractive services based on new technologies, FinTechs stand out as great allies in the market to increase competitiveness and efficiency in the financial sector.

The Mobile Finance Report 2020 revealed that the use of applications in finance increased significantly during 2020, as well as the amount of time that users spend on these types of applications.

During the first half of 2019, users spent an average of 7.7 minutes per session in the banking and payment applications, however, this figure increased to 8.35 minutes in 2020, which represents an increase of almost 9%.

Likewise, FinTech companies have become catalysts for traditional banking to boost its digitization of processes and reinvent itself in the market by adapting to the era of digital transformation.

The alliances between financial institutions and FinTechs translate into great benefits for consumers with more digital services, new business opportunities, and a better experience for customers.

Founded in 2015, AntIT is a mobile development company specialized in Minimum Viable Product (MVP) and Time-To-Make (TTM) products with a portfolio strongly focused on the FinTech industry.

" As digital products are consolidated, banks must define their value proposition to encompass both digital innovation and traditional values, this to meet the needs of their customers by eliminating intermediaries in each of their operations," according to the Global Study of Consumers in Distribution and Marketing 2017 of the company Accenture.

FinTechs offer solutions to traditional banking by leveraging connectivity, mobile technologies, data analysis, and the implementation of artificial intelligence. 

There are many benefits that FinTech can bring us in this area, among them we can highlight:

Savings: FinTech applications are capable of improving business efficiency thanks to their fast and automated procedures, which translate into savings in money as well as time.

Flexibility: FinTechs help develop more agile workflows, save data, and facilitate financial operations no matter where and when the user needs it.

Efficiency: FinTech technology seeks efficiency and process automation through specialized applications as well as better quality concrete services, with quick and agile responses.

According to the study ‚Äú¬†I Caption & ASSET¬†Fintech¬†Report¬†‚ÄĚ, the companies invest in¬†fintech¬†solutions for their efficiency and better time management.

Analysis: FinTech technology improves the analysis of processes with more detailed information and data, improving its competitiveness concerning its competitors.

Digital platforms: regarding the payments sector, FinTechs have stood out as strategic allies for banking entities to replace their infrastructure with new and innovative solutions, achieving greater customer acquisition, retention, and loyalty.

Users have high expectations regarding the characteristics of the service, specifically speed and availability in real-time.

Applications in the Costa Rican market such as Pei created by Antit, an expert company in FinTech development, process payments instantly 24/7 and transfer money to friends and family.

It even allows you to divide payment for an outing between friends through a simple application from the APP, combining the characteristics of a direct debit with the benefit that it is still up to the payer to initiate that process.

"A state-of-the-art electronic payments system offers Costa Rica untapped potential for fintech companies to be a powerful catalyst for financial inclusion," said the Economic Study of Costa Rica 2020 of the Organization for Cooperation and Economic Development (OECD).

Customer loyalty: FinTech companies improve the user experience, increasing their satisfaction by offering financial products and services specific to their needs in real-time.

Currently, more than 2,000 million adults are excluded from the formal financial system, according to the World Bank's Universal Financial Access 2020 report, this sector has been key in the growth of the FinTech system, creating products that adapt to this population.

"Financial access is the first step towards broader financial inclusion, where individuals and businesses can safely use a variety of appropriate financial services, including savings, payments, credit, and insurance," the report noted.

According to the data from the Mobile Finance Report 2020,  users of finance applications are quite volatile, so to avoid cancellations they must have simple interfaces that facilitate their use with an exceptional experience.

Currently, financial institutions will have no choice but to prioritize the mobile channel, either to reach a greater number of people, as well as to facilitate transactions for their users.

Business efficiency: FinTechs facilitate greater business efficiency for financial institutions with the incorporation of instant messaging chatbots combined with machine learning that allows them to react similarly to human ones.

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Melissa López
April 16, 2021