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Emerging Technologies And Mobile Banking Trends

December 20, 2022by Michael Ezeadichie0
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Emerging Technologies And Mobile Banking Trends

Today, it is hard to imagine that mobile banking was first offered in its infant stage twenty years ago. Mobile banking is currently undergoing rapid technological evolution, even though it first offered the opportunity of carrying out transactions by SMS.

The COVID-19 pandemic sped up the development of financial technology, which, in turn, enabled mobile banking to gain increasing significance when social isolation became the norm. In Nigeria, the value of mobile transactions initiated during the pandemic, however, increased significantly, as evidenced by statistics from the NIBSS, the researchers noted.

Payments were made using mobile devices in 2020, making up 43% of all transactions. 35% of these payments were made using USSD, and 78% of all transfer transactions were made using mobile devices. Mobile transactions surged, according to the Nigerian Inter-Bank Settlement System (NIBSS), from about NGN 8 trillion in 2021 to over NGN 12 trillion as of September 2022. The mobile inter-scheme transaction portal showed that usage increased by 3,406.95 per cent from 4.36 million times to 152.99 million times,” the report stated.

Emerging Technologies And Mobile Banking Trends

Security is always a concern, even though improved customer experience is a built-in benefit of mobile banking’s technological development. Customer experience and safety are thus the primary motivators behind most mobile banking innovations in the future. We examine some of the most significant current banking developments that may impact the industry shortly.

 

Emerging Technologies In Banks In 2022

 

In the banking sector, emerging technologies have repeatedly altered how consumers interact with their money, what they expect from banks, and how these banks operate. Modern processes are simplified and made more effective, mistake rates are decreased, communication is improved, and consumer perceptions of and interactions with money are altered.

 

However, banks stand to gain the most from this technology. Chatbots and automation, two emerging technologies in the financial services sector, cut labour hours, enhance client connections and boost profitability. Even though the effect of emerging technology on financial services will vary depending on the function, you may probably adapt to many of them and gain a lot from them.

 

1. Digital Experience Platforms For Banks

 

Digital experience (DX) platforms are nothing new, but contemporary technologies enable financial institutions to modernise a still-relatively-young financial services technology. For instance, hybrid cloud (cloud/server) solutions offer consumers accessibility and privacy. Furthermore, hybrid platforms enable real-time intelligent data integration for advanced analytics, personalisation, and digitisation.

 

The introduction of API platforms, where users may link their financial data to other apps and vice versa, is among the most significant of these advancements. Many financial institutions have opposed API, but as a result of both local and international regulations requiring businesses to provide open API, many Nigerian companies are now doing the same.

 

Consumers can benefit from open banking in many ways, including by sharing information with third-party budgeting applications and using money-management tools, which enables smaller financial institutions that cannot afford to provide these services directly to customers to do so.

 

2. Blockchain

 

Blockchain is an emerging financial services technology trend revolutionising the financial world as we know it, although its adoption is still somewhat slow. Blockchain, which is the technology that underpins Bitcoin, has been adopted by major financial institutions like JP Morgan Chase and is viewed as one of the most significant opportunities available to banks and other financial institutions right now.

 

Despite being one of the most popular emerging technologies in the financial services sector, blockchain is not yet widely available. While some businesses are creating broader solutions, most banks implement blockchain independently using checking, money processing, trade finance, etc.

 

Smaller financial institutions may face serious obstacles if they lack the resources to find a solution. But with the recent rapid uptake of blockchain, it will soon overtake other standard solutions for payments, fraud prevention, loan processing, smart contracts, and more.

 

3. Chatbots And Artificial Intelligence

 

The digital transformation of banking is increasing, including chatbots and other AI-based tools. They are used by financial organisations of all sizes, ranging from big banks to tiny credit unions, and are pretty popular. Artificial intelligence (AI) affects back-office operations, product delivery, risk management, marketing, and security, while chatbots are its most widely known application.

 

AI impacts back-office operations, product delivery, risk management, marketing, and security. Machines utilise basic algorithms to handle everything from data entry to risk assessment to loan form processing, saving top banks hundreds of thousands of employee hours.

 

The developing financial services industry technologies are also easily accessible to smaller banks, with capabilities to automate certain operations such as documentation, data exchange, data analysis, customer communication, and much more.

 

Meanwhile, speed and mobility have become major priorities for all individuals and organisations in today’s environment. As a result, businesses in every industry attempt to support their physical operations with digital solutions. Of course, a sector like finance, which has an impact wherever people go, has not been immune to digital banking trends.

 

It is now unimaginable for a bank not to have a digital banking solution and to operate solely through physical branches. Almost every bank has a mobile application, and there is fierce competition among these mobile applications. Banks that provide the most current and functional solutions surpass their competition and rank first.

 

What Are The Latest Mobile Banking Trends To Watch?

 

Banks have been working hard to deliver financial operations on mobile channels since smartphones have become an essential part of our lives. The applications for mobile media in banking are growing daily; as such, mobile banking trends in Nigeria are also shifting in this manner.

 

1. Contactless ATM Interaction

 

ATMs came into existence many years ago as a new mobile solution that eliminated the requirement for essential banking services to be performed at a branch office.

 

The requirement for a debit card to make purchases today casts doubt on ATM performance. As a result, eliminating the need for debit cards and enabling simple, contactless transactions through the interaction of the mobile banking application and ATM has become a mobile banking trend.

 

Typically, a QR code is displayed on the ATM screen for mobile devices to read, or a contemporary solution such as NFTs is employed. As a result, bank customers may easily access the nearest ATM, displayed on a map, via their mobile applications whenever they need it.

 

2. Machine Learning & Artificial Intelligence

 

One technological advancement that has the potential to influence both the present and the future of digital finance is machine learning. Banks that use machine learning in their mobile operations can predict user requirements more accurately. Banks can guarantee that they always provide customers with the best service in this way. Online banking is also significantly more secure against fraud thanks to machine learning processes enabled by big data.

 

When powered by machine learning, artificial intelligence (AI) chat robots successfully assist customers in performing appropriate tasks and delivering customer care.

 

3. Mobile Wallet & Virtual Payment

 

Cash or credit card purchases can occasionally be highly hazardous and problematic. Customers can get around the issues these transactions bring up by using mobile wallets and contactless mobile payment methods like QR codes and NFTs. These techniques make it simple to manage purchases without ever visiting the cashier.

 

The ability to use contactless mobile payments is a feature that significantly improves the consumer experience, particularly in the post-pandemic period. Customers who use a mobile wallet to make their purchases can shop whenever and wherever they choose while still controlling their spending.

 

4. Biometric Authentication

 

Banks take several security precautions to ensure that customers using their financial services do so safely. These precautions seem as complex protocols in mobile banking, like password control and SMS confirmation when opening a mobile app.

 

Technology advancements have brought about the emergence of authentication techniques that utilise the individual passwords stored within the user’s body. Users can access their bank accounts much more quickly and securely using biometric authentication techniques like fingerprint reading and face and eye scanning.

 

5. Voice Recognition

 

Another trend in mobile banking is to make it possible for the applications to recognise voice instructions and carry them out. Voice commands allow users to access the desired action quickly and easily without navigating numerous menus.

 

Additionally, the speech recognition function is crucial for accessibility. Voice instructions make banking much more comfortable for individuals who are blind or visually impaired. Therefore, the voice command capability is available in practically all new financial programs.

 

Benefits Of Mobile Banking In Nigeria

 

1. Improved Customer Experience

 

An effective client relationship is crucial in the banking industry. Your chances of keeping the client and bringing in new ones increase if you own a positive, polite, and healthy relationship with them. Mobile banking is an excellent option for folks who aren’t always able to visit the actual location during business hours because it’s accessible around the clock.

 

2. Enhanced Security

 

Money-related issues have always been touchy. Protecting your assets and your activities on the applications fall under the category of security, which is a crucial component of bank operations. It needs more than that to sign in to a banking app because it’s not your social networking account where the username and password would be sufficient to gain access.

 

Most banking apps demand multi-factor authentication, including your phone number, mail, government-issued identification, or even a fingerprint and face scan. No matter how much money you intend to send, this authentication is also necessary to execute transactions. These precautions are made to ensure maximum security because hazards or malicious harm are always a possibility.

 

3. Added Services

 

The fact that mobile banking applications offer more edge-cutting services than conventional financial institutions is another benefit of using them. You may use the app to send money anytime, activate a new credit or debit card, deposit a check, and monitor your finances remotely.

 

Limitations Of Mobile Banking In Nigeria

 

1. Technical Issues

 

Mobile banking may have limitations due to problems that appear during development and occasionally after the application is released. To please your client, it’s crucial to identify and address any problem with the software using the assistance of a testing agency.

 

2. Security

 

Banks strive to create the safest, most secure system possible, yet they frequently fall short. A preponderance of banking apps reportedly lacked adequate code protection with streams of data leakages to other mobile apps. Also, most solutions utilise APIs simply data carelessly, allowing hackers to take it with ineffective encryption techniques.

 

Conclusion

 

The synergy between emerging technologies and mobile banking is already raving in the financial sector of the Nigerian economy, thereby compelling banks and other financial institutions to adopt the innovations to make their operations aptly customer-centric and efficient.


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