More and more private banks have sprung out in the recent years, banking is one sector that needs tremendous innovation to increase their growth and improve their customer’s wealth simultaneously. Here is a list of powerful fintech ideas for banks.
Artificial Intelligence backed lending risk assessment
Artificial Intelligence (AI) is the way forward, using Artificial Intelligence, banks can calculate the risks associated with lending people the money they need for their financial emergencies or starting a business. Using Artificial Intelligence bank-wide can use the learnings from previous experiences that are fed into the system by researchers and then it can be trained to look for patterns and analyze the outcome. Once the output is satisfactory, it can be used to assist managers and loan sanction officers with its recommendations. Implementing Artificial Intelligence can reduce the risk to a greater extent. This idea is at the top of the powerful fintech ideas for banks list.
Blockchain-based faster fund transfer
On our list of powerful fintech ideas for banks, this idea features as number two on the list. Blockchain-based fund transfer, Ripple is one of the startups that is working on drastically minimizing the time taken to transfer money across the world. Traditionally, the whole payment transfer process would usually take 1 to 3 days. Whereas using Ripple or Stellar (XLM) would significantly reduce the transfer time to less than 3 seconds and lessen the exchange & conversion fee. Banks can offer immediate transfer of funds between users while ensuring the safety and validity of the transactions done through these platforms.
Smart Contract Cross-border lending
Banks have the power to lend small loans for small-scale enterprises that are in dire need of finance to either upgrade their infrastructure or expand their presence. A Smart contract backed Cross-border lending allows them to avail the funding while agreeing to pay the interest over a stipulated time. Tieing up with international credit agencies and using the Artificial Intelligence backed Risk Assessment Engine could help in evaluating the borrower’s profile. The smart contracts would be the agreement between the bank and the borrower. This is our third most favorite on the list of powerful fintech ideas for banks.
AI-powered Wealth & Investment portfolio management
This revolutionary idea is number 4 on the list of powerful fintech ideas for banks. Wealth & Investment portfolio management is a very important offering by any bank where Personal wealth managers advise customers to invest in a variety of financial products and services that the bank offers. Most often the returns are unsatisfactory or the wealth manager accidentally misguides and the customers’ investment takes a hit. An Artificial Intelligence powered portfolio management system can always assist the wealth manager in taking better decisions for an improved success rate. Note that AI can only be a supplemental tool in wealth management and it cannot replace a human, as customers doing larger transactions usually prefer a person to talk to and get an opinion from them.
Smart Contracts for Insurance
In the driverless vehicle era, the banking and Insurance industry needs to go through a paradigm shift as well. Insurance companies that offer reimbursement for damages, so far relied on reports filed by police if the law enforcement left out any detail, it would be cumbersome or it won’t be possible to get a reassessment done. Driverless vehicles rely on sensor data for assessing the extent of damage, which party’s fault was it etc. Financial institutions can use this data to disburse or reject the claim. This idea on the list of powerful fintech ideas for banks could transform the insurance industry as we know it.
Cryptocurrency based Merchant payments gateway
Cryptocurrency is slowly becoming a mainstream mode of payment, as more and more customers are willing to pay using cryptocurrencies, it would only make sense that banks take the giant leap in supporting cryptocurrencies (Of course in countries where cryptocurrencies are legal) thereby making it convenient for businesses to start accepting them. Merchant services that start accepting payments can tap into more customers who can pay using the cryptocurrencies. The banks also have the opportunity of earning additional revenue through merchant fees. This is our final idea on the list of powerful fintech ideas for banks.
If you have any other powerful fintech ideas for banks, do let us know in the comments.