Predictions for Fintech: Balancing hype with realism in 2018 Viewing exciting advances through the lens of pure pragmatism

The vast and constantly shifting ocean of Fintech,
and all that it encompasses, has seen ripples and undercurrents become
indomitable swells in terms of the changes it has brought upon us recently.

As our understanding of the opportunities
and challenged develops, I feel that a pragmatic approach offers us the best
lens through which to view the movements and progression of the Fintech sector.

When talking to customers in 2017, I’ve
noticed that conversations have moved from technology-centric to solution-centric. I
believe this is a result of a wider understanding of Fintech and its practical
implications, as well as the businesses, technologies and methodologies it
touches. In this blog post I will outline some of those conversations and the
way I expect them to impact the sector in 2018.

Meet customer needs in digital
transformation

Customers need solutions which work well
for them, that are simple to understand, and which are delivered quickly. The
ability of Financial Services firms to provide personalized and frictionless
service – anytime, anywhere – via multiple channels is going to be flavor of
the year in 2018; this is exactly how we build in competitive advantage, show
real leadership, and a permanent willingness to improve.

We are seeing banks move away from paper
and analogue, and
focusing increasingly on digital transformation. That’s all fine of course, but they need a robust
digital architecture with slick and reliable processes for this to actually
happen. This in and of itself is fascinating to me, as I think I first heard
the term ‘go paperless’ in 1998…

If the aim is to get closer to what
customers want and accelerate digital transformation, then success requires a
new template, model or approach that supports rapid change. We can bridge
between traditional operations and agile innovation by centering ourselves on
the critical enabler of digital transformation – Data – in all of
its diverse expressions.

Operations like form filling and digital
signature capturing allow banks to capture and analyze information faster and
use advanced analytics to improve the overall customer experience.

Hitachi Vantara focuses on digital
outcomes. We want our customers to achieve cost efficiency and accelerate
time-to-market by rethinking operations and processes and ensuring that their
data is on point and totally at available. What happens when we do this? For
the client it means increased customer loyalty and revenue growth through
improved customer experiences that are based on analytics and insights.

Analytics is especially interesting
because, among other things, it directly transforms video data into competitive
insights. Cameras are everywhere these days and have now become Internet of
Things (IoT) sensors which can provide real-time intel. But to make the most of
this value, organizations need an analytics solution. 

Exploring the possibilities of developed
AI

In 2017, we saw machine learning playing a
major role in creating personalized products, and in 2018 I expect to see the
rapid development of solutions based on artificial intelligence.

Although the technology is still in its
early stages, we are already seeing multiple AI use cases, for example better
customer targeting and segmentation or the automation of processes such as loan
underwriting or chat bots.

AI has also been a focus for Hitachi
Vantara. Our customers benefit from 107 years of experience in operational tech
and 58 years in IT that we combine in the smart IoT platform we call Lumada. Advanced analytics
and machine learning are packaged into solution cores to
solve business problems and
help companies embrace the benefits of real-time optimization and AI.

Pentaho,
a Hitachi Group Company,
announced earlier this year it had created orchestration capabilities that
streamline the entire machine learning workflow and enable teams of data
scientists, engineers and analysts to train, tune, test and deploy predictive
models. Pentaho’s Data Integration and Analytics platform ends the ‘gridlock’
associated with machine learning by enabling smooth team collaboration,
maximizing limited data science resources and putting predictive models to work
on big data faster – regardless of use case, industry or language. So just
think of the AI possibilities this could bring to Fintech in 2018!

Protection and Governance become paramount

Data governance and protection will be
another key trend. Customers are now willing to share more information to
receive more personalized services. However, ensuring protection of this data
is often very challenging, since it is siloed and often unstructured.

Many large financial institutions are now
working on centralizing information to gain a holistic view of their data and
processes. As a result, access control is becoming much tighter, and will
become even more so in 2018.

Companies need to focus on meeting
governance and regulatory compliance rules – and gaining absolute control of
corporate data organization-wide. These solutions securely automate discovery,
extraction, classification, enrichment and categorization across any data
landscape. The aim is streamlined compliance, again with customer-centricity at
its heart.

When it comes to Data
Protection, my approach is “get it done yesterday”.
Old-school data protection has officially been disrupted – and one only has to
think about the companies who have become massive news stories for all the wrong
reasons to see why.

To become truly secure, companies need to
focus on orchestrating backup, business continuity and disaster recovery within
business-defined workflows. Hitachi works to simplify all of our client’s
recovery challenges via a single unified platform; cutting cost, complexity and
risk to meet the service-level requirements with advanced data management and
protection techniques.

With these three pragmatic and
methodological approaches, we can begin to get our heads around the challenges
facing the Fintech industry – both now and in the future. We can also put a
brave foot forward, and hopefully soon walk quickly in step with a
fast-changing environment.

And therein lies the opportunity.