Financial services have changed significantly in the last 50 years. Moving from a time in which ATMs were scarce, credit cards were a rarity and financial institutions lacked accessibility, we now live in a time where the majority of financial services are at the touch of a button.
The digital revolution has caused the global financial services industry to accelerate rapidly meaning that certain practices, such as cash payments, face-to-face consultancy meetings and ATMs, are becoming less and less commonplace.
Interestingly, the fast changes in financial services has also meant that the ways in which we pay for items and services has greatly changed, including medical services (source: GlobMed) and other high value services.
Gone are the days where you had to book an appointment to visit your bank or wait in line to speak to a financial consultant. The physical act of going to a bank is largely outdated since the addition of digital banking systems, reflected by many physical bank branches closing down their operations.
Digital banking has been revolutionary for the financial services sector meaning that consumers have 24/7 access to mobile banking services. This means that any service, such as transferring money, paying bills, receiving salaries, can be done digitally and instantaneously. This has been one of the fundamental changes in how global financial services have changed in the last decade.
Digital and Contactless Payments
Historically, in order to make a payment, you would need to visit your bank in order to approve the transaction. Now, payments can be done at the touch of a button. Using digital payment apps or specific bank apps, you can pay your bills directly from your mobile phone. This is the case for almost every financial product and service, from online payday loans to mortgages and car finance.
Contactless payments have also been a huge gamechanger for the financial services sector. The majority of retailers and restaurants now accept contactless payments negating the need to carry around any cash or even a physical credit or debit card. With just the tap of your phone you can pay for dinners, clothes and transport.
Digitalization of Customer Service
It can be useful to speak to someone if you are having doubts about your bank account or are seeking financial advice. However, it also involves organising an appointment, waiting until a specific time and date and having to physically go somewhere in order to have the meeting.
Now, thanks to the digitalisation of customer services, the majority of financial services offer a 24-hour chat service meaning that your enquiries can be answered at all hours of the day. Customer service is permanently available and accessible meaning that you can get answers in the moment and can solve any issues instantly.
Budgeting and Money Management
Managing your finances is not always easy; however, now there are a range of different apps to help you with this.
You can track your monthly outgoings down to the category meaning that you know exactly how much you are spending and where your money is going. Budgeting apps can help you set yourself financial goals, put aside money for savings and help you plan on a longer-term basis. There are also apps available to help you divide finances with other people, be it for splitting house bills, sharing the cost of a meal or evening out finances from a group holiday.
One of the biggest changes that has occurred in recent years is the adoption of digital currencies. Digital currencies, such as bitcoin, ethereum and dogecoin, have changed the landscape of the financial services sector.
They operate via a decentralised network and all transactions are stored via blockchain technology. Digital currencies have impacted how we view investments and assets and have offered a new, low-cost way to facilitate secure and fast transactions. As this method gains traction, it is possible that digital currencies may be replacing traditional currencies in certain settings in the future.