Every sector is important for the economic growth of the country. But few sectors are so important that they can either make or break the economy. One such sector is Banking, which is why it is the talk of the town. Today we will see how technology is impacting the banking sector, and what we can expect in the future. Let’s begin our discussion with the institutions that keep an eye on the banking sector in their respective country. In India, we have the Reserve Bank of India, and in the US, we have Federal Deposit Insurance Corporation. These institutions make sure that the banking sector in their country is making the most use of technology to become efficient and provide excellent services.
Role of Technology in the Banking Sector
We will start from the very basics. The banking sector uses the money deposited in the banks to earn money. For this, people need to trust the bank. Here’s where technology supports the banking sector. When people face concerns, they directly get in touch with the bank using features offered by technology such as chatbots. Technology allows banks to provide secure and quick service to their customers. The customers are more likely to continue depositing money and use the services offered by the bank if their queries are resolved on time.
The bank needs to maintain its reputation in the banking sector so that it can acquire more customers. They use technology to up-sell and cross-sell their products and services to the customers. With modern technology, the time taken to deliver the message is almost the time in which the customer gets the first response. So, you see how technology is eliminating human errors, increasing security, and helping the banking sector to reach out to more customers.
How Technology is the Backbone of the Banking Sector?
By now, we are so used to technology in the banking sector that without it, we wouldn’t know how to function. Technology has made our banking experience very convenient. The impact of technology in the banking sector is so significant that without it, the services will come to a halt. What would happen to the banking sector without technology? It will collapse and since this possibility is almost impossible, let’s not think about it. With time, we will keep developing new technologies and both the banking service providers and their customers will benefit from it.
Impact of Technology in the Banking Sector
We have seen how technology has changed the way the banking sector operates. Now we will see what exactly are the impacts.
Back in the days, when technology was still at a very developing phase in the banking sector, people used to stand in the queue to get basic services. Do you remember standing in ATM and Passbook printing queue for hours to get work done that should only take a couple of minutes? The tragedy at the time was standing in the ATM queue for hours for withdrawing cash, and by the time it’s your turn, the ATM runs out of cash.
Thanks to technology, you don’t have to face such situations anymore. Technology brought Digitization to the banking sector that changed our perception of banking. Now with a few clicks, you can do net banking and check your balance easily. What more could we ask for? Isn’t getting timely and reliable service all we need? Even banking service providers can easily maintain documents now more than ever with technology.
The advantage of online banking service is that it is more transparent than traditional banking. Even if you are someone who doesn’t understand the banking services well. You can always consult the ones that do by showing them the services online. The major positive impact of technology without which we can’t continue our discussion is security. Now with technology, we have two-factor authentication, the use of passwords, and many more security processes. This has minimized the scope of fraud in the banking sector.
We very well know that technology is not just all positive, it comes along with downsides. But again, it depends on how we use it. If you are careless about your data just because you have the technology, then you’ll have to bear the costs of it. You can surely rely on technology for safeguarding your personal data, but you can’t afford to be careless about it. Who would you blame if your bank data is compromised? Such fraud activities are carried out online in very little time.
Even though technology safeguards your personal data, keep in mind that the same technology is used by hackers to steal the data and make money out of it. There is no need for robbers to go all the way to banks to steal money and assets, the hackers can simply use technology and in no time they can hack without leaving traces. None of this is meant to create fear among you, but you should be careful about the service providers that you select and ensure that they prioritize security more than profits.
Now let’s look at how technology in the banking sector can directly impact you. We have seen how automation has replaced the jobs in different sectors, the banking sector is no exception. Automation has given commendable outputs and this is why the banking sector is focusing on it. But if this continues, we will have fewer job vacancies in this sector.
Technology is helping the banking sector to create awareness about its presence among the general public and increase its customer base. Now they can easily reach out to as many people as possible using technology and attract them with its products and services. There are risks with technology in the banking sector, we can still prevent them, but functioning without technology is like reaching a dead end. We don’t know what we will do without technology in the banking sector, but we do know that if we use it cautiously, we can improve our banking experience.