Over the last decade, the Fintech landscape has grown by an annual rate of about 24% across developed nations within Europe, North America, and Asia according to an overview of market developments by EY. As this growth has become amplified, we see Fintechs proving to have a considerable impact on the financial industry in the way of innovative, customer-friendly solutions that offer greater flexibility than current options provided by traditional institutions. While this works in developed nations, where the customer base wants flexibility, in underdeveloped nations like Sub-Saharan African, there is massive potential. Here is how Fintechs are helping African Nations transition from being unbanked or underbanked to financial inclusion.
FinTech’s Are Providing an Alternative to Cash.
he biggest alternative to date is the mobile application, M-Pesa, which is a mobile phone-based money transfer, financing, and microfinancing service that was launched back in 2007. It allows individuals to deposit, withdraw, transfer, and pay for goods and services with their mobile devices. When an individual sends balances, they use a PIN-secured and SMS text message to other users who can then redeem them as regular money. While there is a fee for sending and withdrawing money, it is small. This banking service is branchless, as banking agents are found at retail outlets or as airtime resellers, rather than as actual bank tellers.
African Citizens Gain Access to Fraud Prevention Using ID Verifications.
There are several spaces and regions within Africa, where intermediaries are inefficient, corrupt, and commit all kinds of financial crimes like fraud. An open ledger would not only replace intermediaries, but it can also increase transaction efficiency. Corrupt individuals would never be able to delete or remove transactions as ID verification would be used to track every transaction in existence.
The Blockchain is Being Used for Transparency.
With an open ledger like the Blockchain, all transactions would be recorded and be accessible to the public. This would allow individuals, companies, and departments to monitor their funding, wealth, and investments without fear of crooked money coming in or out.
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The FinTech blockchain market is growing at a fast pace, due to the rising cryptocurrency market cap and Initial Currency Offering (ICO), high computability with financial services ecosystem, faster transactions, and reduced total cost of ownership.The global FinTech blockchain market size is expected to grow from USD 370.3 Million in 2018 to USD 6,228.2 million by 2023, at a Compound Annual Growth Rate (CAGR) of 75.9% during the forecast period.Download PDF Brochure @ https://www.marketsandmarkets.com/pdfdownloadNew.asp?id=38566589The FinTech blockchain ecosystem comprises vendors, such as AWS (US), IBM (US), Microsoft (US), Ripple (US), Chain (US), Earthport (UK), Bitfury (US), BTL Group (Canada), Oracle (US), Digital Asset Holdings (US), Circle (Ireland), Factom (US), AlphaPoint (US), Coinbase (US), Abra (US), Auxesis Group (India), BitPay (US), BlockCypher (US), Applied Blockchain (UK), RecordesKeeper (Spain), Symbiont (US), Guardtime (Estonia), Cambridge Blockchain (US), Tradle (US), and Blockchain Advisory Mauritius Foundation (Mauritius).
These players have adopted multiple business strategies to extend their global presence and expand their market shares.
Partnerships, agreements, and collaborations have been the key strategies adopted by these industry players to accomplish development and sustain in the competitive market.
In addition, new product launches and upgradations, business expansions, and venture funding are some of the other significant strategies embraced by these market players to grow in the blockchain market.IBM has undertaken partnerships as its major development strategy to create a leading market edge.
As a part of its inorganic growth strategy, in October 2017, IBM partnered with Stellar, the blockchain startup company, and KlickEx Group, the payment company, to launch cross-border payment systems using blockchain that lowers the cost of completing global payments for business and consumers.
This partnership would assist IBM to further enhance its client portfolio in banking, as well as non-banking financial services areas, and penetrate its presence in the growing FinTech blockchain market.Microsoft operates in several countries and primarily serves regions including the Americas; Europe, Middle East, and Africa (EMEA); and Asia Pacific (APAC).
The data analysis of Big Data helps create new products and services based on what consumers want.
With these powerful AI systems, the marketing of financial products will be more about the response to an identified demand than trying to build up demand through advertising campaigns.For Fintech businesses, AI increases efficiency and provides valuable business intelligence that can be used to make better executive decisions about what products or services to offer and how best to sell them.LOWER BARRIERS TO MARKET-ENTRY AND INCREASED COMPETITIONThe proliferation of AI used for data mining and the open source nature of some AI programming is helping to make sure the AI is not controlled only by big governments and multi-national enterprises.This open-source AI allows the algorithms to be used by smaller companies who associate with other companies to leverage their offerings of financial products and services.
https://is.gd/DLAxlJ IMPROVED USER EXPERIENCESThe user experience drives the success stories of AI applications.
AI improves predictive analytics that helps executives make better decisions and, in many cases, can make autonomous decisions more efficiently with little need for human supervision.
Other systems, called “Robo-advisors” simply make trade recommendations that are then used by an investor to help them better manage their financial portfolioHaving a robo-advisor is like having a personal fund manager working on the investor’s portfolio, except there are no commissions to pay.
They build up their client base by making successful and helpful trading recommendations.This means that the programmers of these systems are motivated to make them show high-performance financial results in order to attract new clients.
