What is the Future of Financial Services?

In the distant past, people paid for goods and services by bartering. Currency soon entered the market and transformed from cocoa beans into cash. Then, in 1950, the first universal credit card became available to the public. At the time, it was considered the future of financing. Now, credit cards are gradually making way for more convenient ways of not just buying groceries, but also for auto financing. So, what exactly has changed, and what will the near future of financing look like?

New Financial Tech Developments

Some traditional banks are still hampered by core systems developed decades ago. These older systems served banks well at the time they were created and even gave them a competitive edge. Now, they’re holding them back from competing successfully with smaller and more agile banks.

Small banks tend to compete by offering more advanced platforms to both employees and consumers. These feature cloud computing, a modular system design, interoperability, and API management. The end results are flexibility and ease of use to customers. It also makes it easier for banks to add new services and scale their operations up or down as market trends allow. See some of these new developments below.

Online Bill Paying

Consumers have been able to make bill payments online for years. However, in the past, they had to set these up for each billed account and had no central platform to track all payments. Now, most banks offer a centralized, online, bill-paying experience on your desktop. Some also offer mobile bill pay.

Mobile Check Deposit

Checks are becoming a less popular way of making and accepting payments. One reason recipients disliked them in comparison to direct deposits was the necessary trip to the bank. This is no longer the case. People can deposit checks by simply scanning the front and back via mobile bank apps.

Bank Alerts

One of the risks of electronic payments is that consumers could lose track of their finances. Many banks now offer alerts to let customers know via texts, account notifications, or emails when transactions occur and what their current account balances are.

Contactless Credit Card

Most Americans still prefer to use their cards to pay for goods and services, even though they love the contactless approach of mobile phone payments. The contactless card offers the best of both worlds by removing the need to swipe or insert into a chip reader Just hold the card near a payment terminal (known as an RFID reader) and it picks up the signal, communicates with the card and processes the payment.


The frequency of cybercrime threats has made more Americans comfortable with using fingerprint scanning and other biometric information for fraud prevention. This is often built into mobile apps. Users get prompted when signing in and sometimes to confirm a transaction. Face and voice recognition are also on the upswing.

Online Applications

Consumers can apply for virtually any type of loan online these days if they choose the right bank. From home loans to car loans, there is no longer a need to go through the longer and sometime more tedious paper process at a brick and mortar bank branch.

Artificial Intelligence

Banks are using AI more as part of their risk evaluation process. This allows consumers to apply online and get immediate approval, pre-approval, or denial based on pre-established conditions written into the algorithm.


Bank workers tend to have traditional work hours, even at contact centers. There are very few exceptions to this, so to ensure customers can always get answers, many institutions now have chatbots in place to answer basic questions and schedule follow-up appointements or conversations when necessary.


Banks are the ultimate prizes for thieves, and even trusted bank brands have experienced security breaches over the past few years. It’s not just big banks and corporations that are targets. Even smaller banks receive targeted cybercrime attempts by the thousands. The current cybercrime threat pushes cybersecurity to the top of banks’ lists to protect consumer data and finances.

Financial Market Trends

Not all fintech advancements have taken off just yet. Some are still battling consumer wariness in the market. Still, here are some notable trends for the most popular fintech services available:

  • In 2018, for the first time ever, there were more debit transfers cleared than check payments.

  • Only around 6.5% of American households are entirely cash-based.

  • 84% of people who used mobile payments at all had also used it in the past month.

  • Homebuyers prefer a digital mortgage experience, but not to the point of losing direct contact with their lender.

  • 63% of people who use smartphones in America have installed at least one financial app.

  • 59% of Americans with auto loans get electronic statements, and 68% of those who get paper statements still make payments online.

Benefits of FinTech Developments

The most significant benefit of financial tech to date has been the increased convenience. In the past, when people wanted to finance a car or buy a home, they had to go into a brick and mortar bank branch to speak with a lender. While many people still prefer direct contact when they have narrowed down their options, shopping around is now a convenient online process. This complements the fact that many people are also already using online apps, such as Zillow and CarGurus, to shop for their homes and cars.

A second significant benefit is speed. Paperwork has historically taken a long time to process. Subsequently, people had to plan way ahead when making big purchases that required a loan. Processing that paper application could take anywhere from 30 to 90 days. The introduction of artificial intelligence to the decision-making process has definitely sped things up. Now, banks sometimes give an answer in 48 hours or less, depending on the type of credit application and individual circumstances.

A third benefit is security. This might surprise some people who believe that cash is the safest of all. However, cash can get stolen, and there can be no immediate recourse. In contrast, U.S. law makes it mandatory for lenders to resolve unauthorized charges on a credit or debit card once the owner of the account informs the lender within 60 days. Recent developments in fintech have also tackled existing vulnerabilities with credit cards, such as chip technology, contactless transactions, and biometric technology.

Moving the Market

Millennials and Gen Z have particularly taken to fintech, but the rest of the market lags behind. While more than half of Americans have used their mobile phones to make payments in the past year, people who prefer traditional cards outnumber mobile payment users two to one. There appears to be two main reasons for this.

The first reason is that, for the most part, credit cards already meet the needs of the general public. This makes moving to new payment methods seem like an unnecessary hassle. The idea of contactless payment is attractive to many, but contactless credit cards only claimed a portion of this market. Finally, there is the issue of trust. Most people do not yet trust mobile payments and smart phones the way they do credit cards and debit cards.

Upgrade Your Banking Experience

Not everyone is ready to do a retina scan before making their next purchase. Still, there’s no denying the benefits that more conservative Fintech advancements have brought to the table. Isn’t it time you brought your banking experience a little further into the future? Blackhawk Bank offers several online banking services that are not only convenient but safe. We would love to discuss your needs face to face.

Here is a list of the branches nearest you.


Meghan Moss
VP Retail Sales Manager

Read More From Common Cent$