FINTECH

10 Fintech Trends Disrupting The Financial Industry

Published

1 year ago

10 Fintech Trends Disrupting The Financial Industry

Global funding for the fintech business has increased by 96% in the last year. This comes to terms as new technological advancements emerge in the financial industry, thereby promoting the worth of some fintech companies to become “decacorns” (companies valued at more than $10 million).

Financial service users are progressively migrating to the digital arena, choosing online services over traditional ones. Therefore, this motivates financial institutions to make swift judgments, incorporate cutting-edge technology, and improve client service.

As one of the most disruptive businesses, fintech has substantially changed how people deal with financial institutions over the past decade and hasn’t stopped there. Every year, new improvements are introduced to suit the ever-increasing client expectations. That is why, to remain relevant and competitive, business owners and executives must grasp where we are now and where we are heading with financial technology.

So in this article, let’s discuss the top fintech trends that drive the financial market.

Top Fintech Trends Disrupting The Financial Industry

1. Contactless Technology

In the fintech industry, contactless technologies are unquestionably growing. Contactless payments meet the rising consumer desire for quicker, more practical methods of purchasing products and services. Additionally, it’s now simpler than ever for customers to make contactless payments because of the widespread use of mobile devices with NFC (near-field communication) technology.

The three most prominent names in contactless payments in the US are Apple Pay, Google Pay, and Samsung Pay. In addition, a PwC estimate projects that by 2022–2033, there will be $1.08 trillion in global mobile payment transactions, up from $396 billion in 2017.

The popularity of contactless payments is rising due to a variety of reasons. The continued use of EMV chip cards is one. Because these cards are safer than traditional magnetic stripe cards, many merchants now require consumers to use them. In Europe, where EMV chip cards have been widely used for many years, this is particularly true.

The acceptance of NFC-enabled mobile devices as a payment method is another factor boosting the use of contactless payments. In reality, many stores already feature NFC terminals that let customers use their smartphones or smartwatches to make contactless purchases. And as more and more customers become accustomed to making payments via their mobile devices, we anticipate seeing much more growth in this field.

2. Digital-Only Banks or neobanks

The increased competition among banks nowadays forces them to seek new chances to stay afloat. Neobank, the latest fintech trend, is a result of the round for each client, the need to cut maintenance costs and available technology options. A neobank is an internet bank without physical locations or branches. Smartphones, tablets, and personal computers are used for electronic communication and customer service. Neobanks typically obtain banking licenses or join an existing traditional bank as a junior partner.

Currently, there are about 70 neobanks in the world, 40 of which are in the UK. In addition, Sweden will discontinue using cash by 2023, and the other nations are expected to follow suit. As a result, many brand-new banks nowadays opt for a digital-only strategy. Research from eMarketer predicts that between 2020 and 2024, the number of users of neobanks will double.

3. Open Banking

Open banking is a program that enables banks to share customer information with fintech firms and other financial institutions. Programming interfaces (APIs) that let the website or app access the bank’s database can be used for data exchange.

One might ask why conventional banks would divulge their information to other organisations. Open banking, paradoxically, keeps banks competitive. The end-user will benefit from improved service and a more comprehensive range of opportunities, thanks to banks.

You can develop open banking applications that compile all financial data from various banks in one location. Users can deposit their paycheck on one bank’s card, save money on another, and make purchases using the bank’s card with the highest cashback benefit. Financial institutions can use open banking to construct account aggregators. Through a handy app, customers may access all of their accounts.

4. Big Data

Vast collections of structured and unstructured data are called “big data” in the finance industry. Banks and other financial firms can utilise them to forecast consumer behaviour and create plans. The financial industry receives analyses and produces enormous volumes of data every second. Structured data is information kept in-house by a business to provide vital information for decisions to be made at the appropriate moment. An ever-increasing volume of unstructured data is gathered from diverse sources, offering great analytical possibilities.

Modern financial technologies enable Big Data to forecast client behaviour and produce detailed risk evaluations, setting them apart from conventional financial organisations.

5. Advanced Cybersecurity

Cybersecurity in fintech never loses significance and emerges as one of the primary market trends. Financial information is delicate and more susceptible to online dangers. A data leak can be expensive for financial companies.

Every year, more sophisticated security measures will emerge due to the fintech sector’s growing vulnerabilities and risk of cyberattacks. According to Grand View Research, the biometrics market will grow to over $25 billion in the coming years.

Even though fingerprinting is currently one of the most used technologies, consumers are searching for new contactless methods to protect their data and establish their identity. Systems for identifying the voice, retina, ears, vein pattern on the hands, and even DNA will advance in 2022. It is anticipated that the number of industry-specific biometric solutions will increase.

6. Blockchain Technology

Blockchain is a finance technological innovation still emerging but has excellent future potential. In a recent global blockchain study conducted by Deloitte, 76% of respondents said digital assets might displace fiat money within the next 5 to 10 years. Companies can use blockchain technology to protect data, carry out identification and verification processes, record transactions, sign contracts, and improve traceability. The security and dependability of this technology make it advantageous for financial services.

Blockchain should, in theory, be the key technology for developing such a system. Transparency, anonymity, and transaction security are provided for all parties by the immutable data recorded by Blockchain.

We have all witnessed the value of Ethereum and Bitcoin soar throughout 2021, with assets held in cryptocurrencies and decentralised finance totalling at least $40 billion. It already has an impact on macroeconomics and is a worldwide trend.

7. Buy Now Pay Later (BNPL)

One of the fintech trends with the quickest rate of growth is BNPL services. Customers can postpone paying for items or services they’ve bought in-person or online, thanks to BNPL. According to the analysis, the global market for BNPL will increase from $24 billion in 2020 to $67 billion in 2025.

The rise in popularity of BNPL can be attributed to various factors. It provides users with a practical approach to managing their finances. Second, it can assist firms in increasing sales and fostering client loyalty. Third, BNPL enterprises can provide interest rates and payment periods that are competitive.

8. Fintech Super Apps

An app that offers a broad range of services and is widely used is referred to as a super app. It is, in other words, a comprehensive solution that satisfies the requirements of its users. Super applications are becoming more and more common, particularly in the financial industry. Super applications are in a prime position to disrupt the fintech sector, which is ripe for it.

Super apps are becoming increasingly common in the financial sector for several reasons. They offer a one-stop shop for all of your fintech needs to start. Users who wish to access all their financial services in one location will find this convenient.

Also, many great apps work with a variety of partners. Users now have access to a wide range of services and goods they otherwise might not be able to find in one location.

Super apps are frequently developed with a mobile-first mentality. They are therefore created for usage with smartphones and other mobile devices. This is crucial since more and more individuals use their cell phones as their primary means of internet access and financial transaction.

9. Regtech

Government agencies and the financial markets present the demands for banking companies. These regulations are so numerous that businesses frequently struggle to follow them. As a result, companies spend a lot of money on lawyers to handle this procedure or risk paying fines if they don’t comply with fintech legislation.

It is hard to adhere to every legislation, especially when these regulations keep expanding. Because of this, demand for regtech is rising right now. It enables financial institutions to monitor the accuracy and legitimacy of their operations automatically.

Client identification, data processing and protection, and risk analysis are all responsibilities of the regtech industry. This makes it easier to follow the law and stay out of trouble.

Regtech enables processing massive amounts of regulatory requirements every second about each line of business thanks to automation, Big Data, and Machine Learning. These automated systems are set up to search for trends in past data continuously. As a result, using regulatory technologies to identify problematic cases or detect fraud becomes simpler.

10. Embedded Finance

Embedded finance connects payments for investment instruments, insurance, loans, and debit cards with virtually any non-financial platform. For e-commerce enterprises, embedded finance services are advantageous since they speed up transactions and help boost client loyalty. Before this, customers had to visit the bank, submit a loan request, complete an evaluation process, and then wait for approval.

However, thanks to embedded financing, users may now quickly and easily obtain credit and make any purchases they need online. Particularly for embedded payments, the projection for this growth is impressive.

Conclusion

Fintech has limitless potential because innovation is built on rapidly changing technological technologies. Companies work to meet customers’ needs who desire better and more varied financial services.q

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FINTECH

Kazang Pay launches card acquiring service in Zambia

Published

1 day ago

Christopher

Kazang (www.Kazang.com), the prepaid value-added services (VAS) and card acquiring business within JSE-listed fintech Lesaka Technologies, has launched its Kazang Pay card acceptance solution for merchants in Zambia. Kazang Pay makes it affordable for merchants to accept card payments on the same Kazang terminal they use to sell prepaid products and services.

Kazang Pay launches card acquiring service in Zambia

The Kazang Pay enabled terminal in Zambia accepts VISA debit and credit cards as well as mobile wallet payments. Payments are settled to the merchant’s Kazang wallet on the same day. It’s as easy as letting the customer tap or insert their bank card and enter their PIN on the secure scramble PIN pad.

Kazang operates around 12,000 VAS terminals in Zambia. The goal is to enable the majority to accept card payments over the next six months. Benefits to merchants include low transaction fees and no monthly terminal rental fee for those that meet a modest monthly transaction threshold as well as the opportunity to grow their business through card acceptance.

Kazang is Zambia’s largest VAS point-of-sale terminal provider, enabling mobile money payments, bank and mobile money cash in and out, bill payments, airtime, Zesco, and many other prepaid services on one platform. The addition of card acceptance makes the platform even more comprehensive for merchants and consumers alike.

The launch of Kazang Pay in Zambia follows the introduction of the solution in South Africa, where around 60,000 small and micro merchants use Kazang Pay to accept card payments. In Zambia, there are around 3.8 million debit, credit and ATM cards in issue and 41,000 point of sale (POS) terminals in place. The value of POS transactions has grown to K 111.4 billion by 2022 from less than K 20 billion in 2018, according to the Bank of Zambia.

Says Leon de Wit, managing director at Kazang Zambia: “Zambia has made enormous strides in terms of financial inclusion, with card usage and penetration growing at a rapid pace. With Kazang Pay, merchants can now easily accept card payments on the same all-in-one terminal they already use for vending of VAS products.

“Card transactions help merchants to grow basket sizes and potentially attract more customers, and at the same time, reduce the risks and costs of handling cash. Moving towards digitalised payments will also enable merchants to track sales, manage cash flow, and create a footprint that could make it easier for them to access loans.”

Ashley Naidoo, director of Kazang Pay in South Africa says: “Our Zambian merchants have eagerly embraced our card acquiring service as a valuable part of our one-stop solution. Following the launch of Kazang Pay in Zambia, we have seen higher VAS sales across our merchant base and much-improved merchant retention and with our card acquiring solution we now appeal to a broader merchant base.”

Distributed by APO Group on behalf of Kazang.

ABOUT KAZANG:
Kazang (www.Kazang.com) is a leading provider of cash and digital solutions to merchants in Southern Africa’s informal economies. Our fintech solutions include a diverse range of value-added services (VAS), card acquiring, secure cash vaults and supplier payments platforms. Operating with a network of approximately 90,000 active devices, we process approximately 2.2 million transactions daily in markets such as South Africa, Namibia, Botswana, and Zambia.

We are dedicated to helping small and medium merchants grow and succeed, through increasing their sales, making their businesses more efficient and reducing their risks with its holistic portfolio of products and services. Kazang is a member of Lesaka Technologies (https://LesakaTech.com).

ABOUT LESAKA TECHNOLOGIES, INC:
The Connect Group and Kazang was acquired by Lesaka Technologies, Inc. in April 2022. Lesaka Technologies, (Lesaka™) is a South African Fintech company that utilizes its proprietary banking and payment technologies to deliver superior financial services solutions to merchants (B2B) and consumers (B2C) in Southern Africa. Lesaka’s mission is to drive true financial inclusion for both merchant and consumer markets through offering affordable financial services to previously underserved sectors of the economy. Lesaka offers cash management solutions, growth capital, card acquiring, bill payment technologies and value-added services to retail merchants as well as banking, lending, and insurance solutions to consumers across Southern Africa.

Lesaka has a primary listing on NASDAQ (NasdaqGS: LSAK) and a secondary listing on the Johannesburg Stock Exchange (JSE: LSK). Visit www.LesakaTech.com for additional information about Lesaka Technologies (Lesaka ™). $LSK / $LSAK

Bitcoin

Binance expands crypto access in West and Central Africa with mobile money integration

Published

1 day ago

Christopher

Binance expands crypto access in West and Central Africa with mobile money integration

This new service currently supports only BUY transactions, further simplifying the entry point for new crypto users in these regions

Binance (www.Binance.com), the world’s leading blockchain and cryptocurrency infrastructure provider continues to drive innovation and expand access to cryptocurrency in Africa, now allowing users in Benin, Cameroon, Ivory Coast, Democratic Republic of Congo (DRC), Togo and Senegal to purchase crypto directly through mobile money payments enabled through local partnerships.

This new functionality further strengthens Binance’s commitment to providing simple and secure access to cryptocurrency for users across the continent, reinforcing the platform’s vision of financial inclusion.

Samantha Fuller, Spokeswoman for Binance says “We remain focused on advancing financial inclusion and delivering user-friendly solutions for crypto adoption across Africa. This expansion into West and Central Africa is a significant step in our mission to increase crypto adoption, providing millions of people with more direct access to the global digital economy”.

This new service currently supports only BUY transactions, further simplifying the entry point for new crypto users in these regions, while providing them with a reliable and secure platform to acquire digital assets.

How to buy crypto:

Log in to your Binance app and select [Add Funds] from the homepage.
Choose your local fiat currency you wish to use by selecting the currency in the top-right column.
Follow the instructions to complete your crypto purchase.
Distributed by APO Group on behalf of Binance.

About Binance:
Binance is the world’s leading blockchain ecosystem and cryptocurrency infrastructure provider with a financial product suite that includes the largest digital asset exchange by volume. Trusted by millions worldwide, the Binance platform is dedicated to increasing the freedom of money for users and features an unmatched portfolio of crypto products and offerings, including trading and finance, education, data and research, social good, investment and incubation, decentralisation and infrastructure solutions, and more. For more information, visit: https://www.Binance.com

Risk Warning: Digital asset prices are subject to high market risk and price volatility. The value of your investment may go down or up, and you may not get back the amount invested. You are solely responsible for your investment decisions and Binance is not liable for any losses you may incur. Past performance is not a reliable predictor of future performance. You should only invest in products you are familiar with and where you understand the risks. You should carefully consider your investment experience, financial situation, investment objectives and risk tolerance and consult an independent financial adviser before investing. This material should not be construed as financial advice. For more information, see our Terms of Use and Risk Warning.

BANKING

Financial Analysis: A Comprehensive Study of The Well-Being of A Country

Published

11 months ago

softchris4ol

Financial Analysis: A Comprehensive Study of The Well-Being of A Country

Understanding the financial stability of a country requires a thorough understanding of financial analysis. In order to offer insights into the overall financial stability and overall wellness of the country, it entails evaluating a range of economic indicators, financial performance, and market movements.

In this article, we will delve into the fundamentals and importance of financial analysis in evaluating a country’s economic situation.

Financial Analysis: A Comprehensive Study of The Well-Being of A Country

THE HISTORY ABOUT FINANCIAL ANALYSIS

Ancient Beginnings:

The roots of financial analysis can be traced back thousands of years. The ancient Mesopotamians, Egyptians, and Greeks were among the pioneers of documenting financial transactions, creating basic records of assets and liabilities. These early attempts laid the groundwork for the concept of financial analysis through the study of financial statements and ledgers.

Medieval Europe:

During the Middle Ages, Europe witnessed the rise of merchant guilds and the emergence of double-entry bookkeeping. Italian mathematician and Franciscan friar, Luca Pacioli, is often credited with formalizing double-entry bookkeeping, publishing his seminal work “Summa de arithmetica, geometria, proportioni et proportionalita” in 1494. The concept of balancing debits and credits within financial records formed the basis for modern financial analysis techniques.

Industrial Revolution:

The Industrial Revolution in the 18th and 19th centuries revolutionized business and the need for financial analysis grew rapidly. As companies expanded and diversified, investors began demanding more comprehensive financial reports to assess the potential risks and returns of their investments. The birth of limited liability companies further accelerated the need for financial analysis, as shareholders sought transparency in the performance of their investments.

Modern Era:

The 20th century witnessed significant advancements in financial analysis techniques. The advent of electronic computing in the mid-1900s enabled the processing and analysis of vast amounts of financial data, leading to the development of sophisticated financial models and ratios.

The Great Depression of the 1930s laid the groundwork for modern financial analysis as regulators sought effective ways to prevent future economic crises. The establishment of the U.S. Securities and Exchange Commission (SEC) in 1934 brought about standardized reporting requirements, including the filing of audited financial statements. This increased transparency and standardized financial reporting provided analysts with a more accurate and consistent basis for their analysis.

The Rise of Quantitative Analysis:

In the latter half of the 20th century, the growth of computing power and the availability of large data sets propelled financial analysis into new territory. Quantitative analysis, utilizing statistical models and mathematical algorithms, started gaining prominence. Financial analysts began incorporating complex mathematical methods to assess investment opportunities, risk management, and portfolio optimization.

Modern Financial Tools:

With the advent of the internet and the digital age, financial analysis has become even more accessible and data-driven. Sophisticated software programs, data analytics tools, and artificial intelligence have revolutionized the way financial data is analyzed and interpreted. In recent years, technologies like machine learning have been leveraged to develop predictive models that can assess future trends and make accurate financial forecasts.

MEANING

Financial analysis is the process of evaluating businesses, projects, budgets, and other finance-related transactions to determine their performance and suitability. Typically, financial analysis is used to analyze whether an entity is stable, solvent, liquid, or profitable enough to warrant a monetary investment.

Financial analysis is a fundamental tool that allows organizations and individuals to assess the past, present, and future financial health of a business or investment. Through a systematic examination and interpretation of financial statements, ratios, and other key indicators, financial analysis helps in making informed decisions, optimizing resources, and improving overall financial performance. In this article, we will delve into the meaning of financial analysis, its prominent components, and its significance across various sectors.

Financial analysis involves scrutinizing financial data to evaluate the performance and profitability of an entity. It assists in quantifying the effectiveness of financial decisions, identifying trends, predicting future outcomes, and benchmarking against industry standards. By analyzing financial statements, investors, analysts, and other stakeholders gain valuable insights into the financial position, liquidity, solvency, and operational efficiency of an organization.

FUNDAMENTALS OF FINANCIAL ANALYSIS IN A COUNTRY

Gross Domestic Product (GDP): GDP is a primary indicator used to gauge the economic performance of a nation. Financial analysts analyze GDP growth rates and its components, such as consumer spending, government expenditure, investments, and net exports. This analysis helps in determining the overall strength of the economy and identifying areas of potential growth.
Trade and Balance of Payments: Trade analysis focuses on a country’s imports, exports, and balance of payments. Evaluating trade patterns helps identify sectors driving the country’s economic growth, trade imbalances, and potential risks to the economy from external factors such as changes in global demand or disruptions in supply chains.
Inflation and Interest Rates: Analyzing inflation rates and interest rates provides insights into the stability of a country’s economy. High inflation erodes purchasing power, while high-interest rates can impact borrowing costs, affect consumer spending, and investment behavior. Financial analysts assess the impact of inflation and interest rates on an economy’s overall competitiveness and economic growth potential.
Government Debt and Fiscal Policy: Analyzing a country’s government debt levels and fiscal policy is crucial in understanding its financial sustainability. A high level of government debt may lead to increased borrowing costs, reduced investor confidence, and potential risks to economic stability. Evaluating fiscal policies helps determine whether a country is managing its finances effectively and implementing sustainable economic growth strategies.
Stock Market Performance: The stock market reflects investor sentiment and provides valuable insights into a country’s economic outlook. Analysts evaluate key stock market indices, such as the country’s primary exchange, sector-specific indices, and market capitalization trends. Monitoring stock market performance allows for an understanding of investor confidence, economic growth expectations, and potential risks to the financial system.
Banking Sector and Financial Institutions: A robust banking sector is essential for economic stability. Financial analysts assess the health of the banking system by evaluating indicators such as non-performing loans, capital adequacy ratios, and the overall stability and soundness of financial institutions. Understanding the well-being of financial institutions helps gauge the potential risks to the overall economy, including credit availability, liquidity, and financial contagion.
Regulatory Environment and Governance: The regulatory environment and governance play a critical role in attracting investment and fostering economic growth. Financial analysts assess the effectiveness of regulatory frameworks, transparency in financial transactions, and the overall credibility and efficiency of institutions responsible for enforcing regulations. Evaluating the regulatory environment aids in understanding potential risks and opportunities for sustainable economic development.

SIGNIFICANCE OF FINANCIAL ANALYSIS IN A COUNTRY

Financial analysis plays a vital role across various sectors, serving the following purposes:

Evaluating Financial Performance: By conducting a comprehensive financial analysis, companies can assess their performance, profitability, and financial stability. This, in turn, helps in identifying areas for improvement, developing strategic plans, and making sound financial decisions.
Assessing Investment Viability: Investors rely on financial analysis to evaluate the profitability and risks associated with potential investments. Through detailed scrutiny of financial data, investors can determine the financial health and growth prospects of a company, aiding in making informed investment decisions.
Facilitating Lending Decisions: Financial institutions utilize financial analysis to assess the creditworthiness of loan applicants. By analyzing financial statements, evaluating ratios, and assessing the risk profile, lenders can ascertain the borrower’s ability to repay loans and make sound lending decisions.
Supporting Strategic Decision-Making: Financial analysis aids in strategic decision-making, such as expansion, diversification, or mergers and acquisitions. Understanding a company’s financial position and performance provides a foundation for evaluating the feasibility and potential outcomes of such decisions.

CONCLUSION

Conducting a comprehensive financial analysis provides valuable insights into the economic landscape of a country. By evaluating indicators such as GDP, trade patterns, inflation rates, government debt, stock market performance, banking sector health, and regulatory environment, financial analysts can gauge the overall financial health, identify potential risks, and recommend strategies for sustainable economic growth. Accurate and timely financial analysis acts as a compass, guiding policymakers, investors, and businesses to make informed decisions and contribute to the overall prosperity of the nation.