Emerging technologies driving change across the financial services industry

7th December 2021.

Richard Healey, Product Development Director from Paylink Solutions, shares his thoughts on emerging technologies and the features he believes will support the regulator’s ambition of driving change across the financial services industry through improved access, digital processes and the way debt advice is delivered.

Currently fintech is focussed on helping customers understand their affordability in the quickest and simplest way to determine a
solution and improve their financial wellbeing. More integrations than ever are being used to automate this process – most notably credit reference integration for up-to-date credit scoring and lender information, along with Open Banking to help customers create an accurate view on their day-to-day living. 

With all the new emerging technologies, which do you think will have the biggest impact over the next few years?

Artificial intelligence (AI) and low code will have the biggest impact on fintech over the next few years. It will be used to change the emphasis on the market, allow businesses to understand customers’ circumstances and proactively engage strategies before a payment or financial commitment is missed.

Open Banking is now an established fintech, but how can it be adapted to provide an even deeper insight into someone’s financial situation?

Open Banking was initially developed to understand people’s affordability much more accurately than a manual income and expenditure review. We’re going to take this a step further though and use Open Banking to provide our clients with a daily customer update and real-time overview of their financial situation. This will then allow our lending and collections clients to predict whether a customer is likely to be unable to make a payment for that month.

The technology can also be used to understand when the best time of the month to set up payment plan might be, as well as offer competitive products to improve a customer’s financial situation. This would include maximising their income and switching them to a more affordable product to decrease their expenditure.

What role do you think AI will play in improving customer journeys?

AI will also allow us to understand how best to engage with customers through behavioural science, which will subsequently influence the development of enhanced business processes and customer journeys.

This behavioural data would show how and when is best to interact with customers to ensure they’re provided with more personal and organic journeys, rather than through existing hard-coded processes.

How would AI assist customers applying for a lending product or who need to set up a repayment plan?

Customers would be able to set up bespoke, flexible payment plans, using data and technology to determine the most suitable plan based on their existing financial circumstances. This would also benefit the client through more customer commitments being successfully made and subsequent increased kept rates.

Flexible payments will also introduce new dynamic to the self-employed market that was hit particularly hard during the pandemic.

Do you see any potential challenges to the integration of AI?

The challenge with AI is how it works with legacy software. However, this also provides a massive opportunity for fintechs to work with banks and lenders across the debt advice sector to upgrade their legacy apps. This investment would enable financial businesses to take full advantage of what AI can offer and improve the way they interact and engage with customers.

How do you think low code will support the development and delivery of fintech?

It’s predicted that by 2024, low code technology will account for two thirds of application development, but I think it will be huge over the next few years as businesses adapt to the ever-changing industry and gain a speed advantage over competition.

We already use low code development, which has allowed us to scale and enhance our digital platforms. It enables us to develop our digital solutions much more quickly, which when working in an ever-changing financially regulated environment, means we’re able to adapt quickly and ensure effective risk management and governance.

Traditional development and developers are irreplaceable – but as with the technology they deliver, I believe their roles will adapt as low code becomes more prevalent.

What new technologies are Paylink Solutions set to integrate moving forward?

We constantly look for ways to enhance our software for clients and their customers, with a particular emphasis on helping people with vulnerabilities and improving accessibility to reach a wider demographic.

We believe the increased usage of Open Banking will play a big role in helping organisations identify vulnerabilities earlier by adding indicators that can be reported on. For example, repeated prescription costs could be a sign of long-term illness, or regular transactions to gambling sites could indicate an addiction that the client needs further support with. It will give the agent clues to initiate further conversations, enabling customers to get additional help.

Voice biometrics will improve security and remove barriers to people who may suffer with cognitive impairment and struggle with lengthy login processes. The implementation of translation services across products and websites will encourage online journeys with many more people who are currently unable to access platforms which are predominantly in English.

Touch and face ID

We’re set to enhance the login process to our application by allowing people to use touch or face ID to access their data. Our app will integrate with mobile devices’ existing touch/face ID authentication service – so people can choose whether to use this feature or stick to logging in using the traditional password method.

Voice recognition

Another feature we’re set to introduce is voice recognition, which again will enhance the app’s accessibility. When completing their digital I&E journey, users will be able to ‘speak’ to the app, and the app will be able to ‘speak’ back – removing the need for typing. This will be particularly useful for people who have a vulnerability that affects their ability to use the current process.

PISP

Open Banking payments are also set to be launched within our application to create an easier to manage user process. This will allow users to simply log into their online banking and make payments directly from their account. It also means users don’t have to give their card or bank details to a third party, or even have their card present when making a payment.

This form of payment also benefits merchants as the transaction cost is lower than with alternative payment methods, such as by using a credit/debit card or PayPal. Plus, payments are immediate, so there’s no need to wait several days for a transaction to clear.

Richard’s reflections….

From a market perspective, the technology features we already have – and are set to – put in place reflect how Paylink Solutions is able to quickly respond to and meet ever-changing regulatory, client and customer demands.

We work alongside sister company PayPlan – one of the UK’s largest free debt advice providers – to deliver digital solutions across the debt advice, lending and collections industries and provide a holistic debt advice journey that is accessible to all.

Improving the digital capability of financial support, and providing people with more accessible free debt advice, is a key Government focus, and together with PayPlan, we’re committed to raising standards across the industry.

Financial wellbeing is at the heart of what we do – and making sure people can access financial support and receive debt advice is key. However, this can only be delivered by using the most pioneering technology and we will continue to adapt as new digital trends emerge.

Find out more about Paylink Solutions here.