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Everything Changed In 2020. Will Fintech Ever Be The Same?

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2020 is the year consumers, merchants, financial institutions and businesses alike learned to quickly adapt to new behaviors, procedures and mandates in response to COVID-19. Coping with the virus forced accelerated adoption of new technologies and protocols, especially when it comes to fintech.

It wasn’t until we were faced with the risk of going to the grocery store that we realized how easy it is to have groceries delivered to our doorstep, or until we were afraid to exchange cash that we adopted contactless payments. And while many of us will happily go back to picking our own produce or taking out a crisp twenty-dollar bill, some will never return to their old ways.  

With all that has changed in the fintech world over the past nine months, here are some insights into what trends will stay with us and what won’t in a future, post-pandemic world.


What’s here to stay:

1. Contactless payments. We’ll continue to see massive adoption of cashless, contactless locations and online shopping will continue its explosive growth. We’ve all seen growth of contactless at bigger merchants, but now we are seeing it offered at local flower shops, hardware stores and restaurants. In a recent study of small and medium-sized businesses conducted by FIS FIS , about half of the merchants surveyed offered a new payment method in the past year while focusing on flexibility and new delivery options in response to COVID-19. The same study also found that 60 percent of merchants expect to increase their investment in digital technology in the next year.

2.      Fintech engagement with banks, merchants and emerging services. Since consumers are already in a change mindset, the time is ripe for entrepreneurs to invest in a new product or a small business idea. To succeed, entrepreneurs will need to think about the world as it is today with an eye on the world as it will be. There continues to be rich opportunities for delivery services for restaurants, or remote, digital engagement for retail businesses like hair salons. The application of new fintech solutions will be the common thread that provides opportunity to what’s next for banks, merchants and emerging services.

3.      Your online footprint is growing. During the pandemic, consumers have shifted their buying behavior to online channels in droves, but this swing also puts the consumer at greater risk of fraud. As you proliferate your data online, there are more accounts to manage with a greater potential of data theft. While this isn’t something to fret about, it’s worth understanding that you’ll need to be more diligent in monitoring your financial activity. Now that consumers have signed up for a variety of ecommerce sites, it is expected that most consumers will stay on them even once we’re past the pandemic. While we expect some behaviors to return post-COVID, what we’re seeing now was part of a larger trend and digital banking and shopping will only continue to grow in the years to come.


What’s new is old again:

1.      Leeway on loan repayments. Consumers should no longer count on their bank saying it’s okay not to pay their bills for the next six months. Being able to put everything on hold for their account holders this year had just as much to do with bank self-preservation as taking care of those affected most by the pandemic. December is when many bank leeway programs are ending as most offered a six-month deferment and it’s hard to see those programs extending without any kind of federal or legislative action. The leeway programs will be more individualized going forward rather than one size fits all.

2.      Bank branch appointments and in-person interaction will return. Today you have to call your bank and set up an appointment before you go in. Post-pandemic it will be easier to gain access to the bank once public health is restored and this could help a wider swath of the population get access to bank services. Surely, bank customers and employees will continue to practice social distancing, hand sanitizing, mask use and we will see an increased use of Plexiglas barriers to protect everyone from airborne spread of the virus before this whole thing is over.

3.      The small business market will go back to taking cash. While this may seem at odds with the fact that we have embraced contactless payments, paper money and coins will not go away anytime soon. Cash may not be king but it’s certainly still a prince and an essential financial tool for the millions of unbanked or underbanked people in the U.S. without access to a bank or credit card or simply choose not to use them. Small businesses and merchants do better by their customers by allowing them to pay in their preferred ways—be it contactless payments with a device like a smartphone, dipping a card, or exchanging paper and coin. While cash use will likely not go back to pre-pandemic levels, we’re still decades away from seeing an all-digital payments world in the U.S., and no one running a business is going to turn away cold hard cash anytime soon.


When the “new normal” becomes just “normal”

Although much of the not-so-distant future looks a bit like our recent past, COVID-19 had dramatically altered the way consumers and businesses handle business transactions, even the things that “go back to normal” are still going to look and feel different.

Even once we can safely leave the masks behind and physical contact isn’t met with copious amounts of hand sanitizer afterward, the engines of our financial technology future will continue chugging forward. We’ve seen how digital payments and commerce has helped keep business afloat amidst this trying year, and that technology is only going to get smarter, faster and more intuitive. In a year that uprooted so much of our lives, fintech was there to help us make it through, and I think it will only keep growing from here.

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