As fintech companies around the world continue to grow, so do the challenges they face. Seen as a major disruptor in the traditional banking industry, fintech has the opportunity to change the financial world. With this comes difficulties with regulations, understanding the industry, cybersecurity, and a lack of human interaction.
Regulations: One of the main challenges in this industry is undoubtedly regulations. Companies in fintech have to keep in mind regulations set by the government as well as rules set by parties running banking infrastructure (i.e., PCI council). It can be tough to understand the many regulatory environments around the world, but, fintech companies can make it easier by working directly with those who make the regulations.
Little Understanding: There are many misconceptions surrounding fintech because there aren’t clear guidelines to follow. Many also think that the industry isn’t safe and will cause major financial disruption. Those in fintech can work to combat the challenges of misconception by educating the public on the exact specifications of this new financial revolution.
Cyber Security: We’ve seen many businesses and governments around the world experience cyber attacks in some shape or form. That’s why it’s important for fintech companies to create a good infrastructure that protects sensitive financial data. According to Trimplement, “Investing in security for a fintech startup needs to be a top priority to ensure customer confidence for your products remains high.” Loss of any sensitive data can be damaging for any fintech organization.
Lack of Human Interaction: Many fintech organization struggle to bring on clients because of the lack of “human touch.” This is what separates these revolutionary institutions from traditional banks; however fintech organizations need to be wary of this. The Global Banking and Finance Review suggests that fintech companies keep their “human touch” by “keeping your customers’ needs and experience at the heart of every new technology you adopt should be paramount.” It’s important for the industry to remain relevant by offering exceptional customer service and support.
If fintech companies around the world remain aware of the challenges the industry faces, they will be able to succeed in the long run.