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Fintech & Automation: Convenience or Distraction?

There is no questioning that modern technology plays a major role in the advancement of nearly every industry. Manufacturing, transportation, telecommunications, entertainment, and financial services are just a few of the many industries actively using advanced automated solutions to increase efficiency and improve operations. But has the rush to adopt these newer technologies created more convenience for businesses and their consumers? Or has it simply become a distraction?

Some would argue that the fintech industry has completely reshaped how companies approach their customer service and sales processes — many times for the better. However, others view the conveniences of AI technology, chatbots, and automated banking services as more trouble than they’re worth, diminishing the importance of human interaction and negatively impacting the customer experience. Which viewpoint is correct?

Below we’ll discuss how the fintech industry has developed over time, along with the benefits and concerns associated with it so that you can decide for yourself.

The Rise of Fintech and Automation

Fintech, or financial technology, has been around since the beginning of the 21st century, cutting across multiple business segments and driving new efficiencies in the financial sector — though some of these efficiencies may not have been overly apparent to consumers until recently. It wasn’t until about five years ago that the term “fintech” really started to mean something to businesses and their customers.

Fintech has fundamentally changed the way businesses interact with their customers today. Representing a disruptive group of technologies, fintech is responsible for pioneering new approaches in customer service, online payments systems, business security protocols, and many more advancements. These newly created efficiencies have materialized into a variety of business solutions, including:

  • Chatbots: Utilized in customer service and pre-sale communications to streamline customer-facing interactions.
  • Blockchain Software: Leveraging the distributed ledger system to enable smart contract management, more efficient digital payment processing, and better transactional transparency.
  • Biometrics: Increased security protection through advanced authentication protocols.
  • Machine Learning: AI-enabled technology that mirrors human interactions by using advanced algorithms and historical records to provide predictive behavioural analytics, fraud detection, and process automation.

The guiding principle of fintech is to provide more efficiency through automation while giving businesses the ability they need to meet the growing demands of their customers. Much of this has been achieved with the development and use of AI-enabled technologies.

Benefits of AI-Driven Technologies

The benefits that AI-enabled technology and automated business solutions provide is hard to ignore by modern business leaders. Today, more and more organizations put significant resources into the development of their websites, mobile applications, and business software, all with a focus on creating user-centred designs that both engage their users and create ideal workflows.

AI-driven applications make it possible for businesses to enhance their throughput, maximizing productivity levels and creating more opportunities for scale. For example, automated solutions like chatbots can supplement first-level support staff and immediately answer basic support questions while automatically forwarding more complex interactions to human agents. This automation not only reduces internal bandwidth expenditures and operating costs but also ensures customers receive immediate answers to their questions when they need them.

Artificial intelligence also plays a vital role in the banking industry, evolving how banking institutions interact with their customers while creating more accessible ways for them to manage their finances. AI helps to streamline many banking processes, from omnichannel finance management to cash transfers and bill payments, delivering a better customer experience and more personalization.

The Downside of Too Much Automation

While fintech and automation can provide benefits for both businesses and consumers, there are also downsides to having too much of a “hands-off” approach to technology.

Chatbots and other AI-driven messaging services may seem like they’re the perfect solutions for busy consumers, but machines will always be dependent on some form of human interaction to operate efficiently. Customers may also become offended or annoyed if they aren’t able to interact with a real person, and this can cause issues for a brand’s integrity.

Furthermore, companies that become overly dependent on automation may become more vulnerable to cybersecurity threats. A single missed software update could leave automated processes that rely on customer data to be accessible to hackers with malicious intent. Without contingency plans in place in case of data loss or an inability to access cloud-based tools, productivity may shutter to a halt.

Too much accessibility from smartphones and other mobile devices can also cause unnecessary distractions in our everyday lives, and some of these can be dangerous. Not only can this make employees less efficient, but it can lead to disastrous side effects. Distracted driving still plays a major role in accident statistics — many of which are a result of distractions caused by smartphones. In these cases, it could be said that newer technologies may be more trouble than they’re worth, especially if not used in the proper settings.

When considering if the fintech industry and AI-driven technologies are more convenience or distraction, the answer will inevitably come down to the use case and the user. While most individuals remain cautiously optimistic about the future of technology and automation, balance will continue to be the key when it comes to enjoying these advancements without sacrificing practicality or efficiency.

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