Fintech products offer major benefits, which is why they’re so popular. By handling many tasks that a person might otherwise handle, they streamline financial transactions, analysis, investing, and other processes. Being able to complete essential banking tasks via an app is a lot easier than traveling to a branch and waiting for a teller to be available.
That said, some people may be concerned that the rise of fintech will make humans obsolete in banking and financial services. They also fear that financial institutions will no longer offer the personalized, human touch that technology simply can’t provide.
These are understandable concerns, but that doesn’t mean they’re accurate. Fintech will not make humans unnecessary to banking and financial services; it will simply shift their roles. The following examples illustrate how.
High-level executives and managers at financial institutions often benefit when they collaborate. Sharing ideas and strategizing together results in everything from improved customer service techniques to new product ideas.
Unfortunately, many don’t have the time to collaborate as frequently as they should. That doesn’t need to be the case. McKinsey Global Institute estimates that financial managers spend as much as 34% of their time on tasks that could be automated with technology. The extra time fintech products provide could instead be devoted to working with teams to solve business problems, recruit better talent, and improve overall management methods. Everyone from executives to lower-level employees can benefit as a result. More collaboration could also benefit customers in the form of better service. This would be a clear example of fintech actually making financial services more people-friendly.
Teaching Soft Skills
Successful professionals in the financial services industry often point out that developing and maintaining positive relationships with colleagues and clients is essential. They understand that spending time interacting with others provides them with “soft skills” that translate to better professional relationships in general.
This is something machines cannot offer. Although AI may be able to represent the branded “personality” of a business, it can’t (yet) learn to relate to people on a genuinely emotional level. This is particularly good news for older employees in this sector who may be concerned about the rise of fintech.
Boomers are retiring. Millennials are taking over the workforce. Generation Z isn’t far behind. However, Millennials and members of Generation Z don’t have decades of experience working in their given fields. They haven’t had the same opportunities to develop soft skills as those who have been in the workforce for longer periods of time. In addition, members of younger generations may not have had the same opportunities as older generations to develop good “people skills.” Since technology has reduced face-to-face communication, young people simply don’t have the same opportunities as previous generations to refine their emotional intelligence and improve other soft skills—particularly in professional circles outside their families and friends.
The situation makes older finance professionals strong assets to the companies that employ them. As younger employees begin to replace retirees, they’ll need help learning how best to establish and maintain good relationships with customers and colleagues. In addition to their considerable technical knowledge, older employees provide value to companies because they can offer a more people-centric perspective in a tech-centric world.
Understanding Customer Needs
Many professionals in the financial services industry must divide their time between customer-facing tasks and behind-the-scenes tasks. The more time they spend behind the scenes, the less time they have to truly get to know their customers.
Fortunately, fintech can provide a solution to this problem. For instance, consider fintech’s growing role in wealth management. Identifying quality investment opportunities for clients typically involves analyzing large amounts of data—and the more data, the better. This can be a time-consuming process, but an AI program could analyze huge streams of data 24/7, all while doing so far more efficiently than a human ever could.
Still, the advisor plays an important role—one that may actually become more important thanks to AI.
While AI can analyze data, it can’t get to know a client on a personal level to help them articulate and prioritize their specific financial goals. Humans can also distill the sometimes-overwhelming amounts of data AI can yield, translating raw numbers into meaningful information that clients can understand. Furthermore, AI can’t develop a long-term relationship with a client based on mutual trust. That’s absolutely essential to many financial services, including wealth management.
With AI handling data analysis, wealth management advisors can spend more time helping clients interpret this analysis and use it to make better choices. As a result of spending more time with clients and offering them more insights, wealth management advisors can boost overall customer satisfaction and trust.
These are all points to remember when considering whether technology will ever replace humans in the banking and financial services industries. Again, although it’s easy to understand why someone might have this concern, closer examination shows that fintech will actually improve the human element in financial services. That’s one more reason to embrace it.