Since the dawn of the personal computer and the Internet, technology has impacted how businesses are run in ever-increasing ways, including how companies and consumers manage their finances. Digital technology such as e-commerce platforms, social media, and mobile applications, are now used to facilitate a majority of modern-day transactions. As digital and technological innovation continues, it is crucial that you are aware of and take advantage of these developments as you draw up your banking strategy.
5 Ways Technology is Changing Banking Strategies for Businesses
That said, here are five significant ways technology has changed the ways businesses bank, and how they might affect the future of your organization.
1. Online Banking is the New Norm
With the prevalence of e-commerce in the post-pandemic world, the vast majority of financial transactions are carried out over the Internet. Two-thirds of adults reported carrying out a digital transaction in 2021, according to a World Bank study.
To take advantage of the shift toward online banking, consider providing your customers with a way to pay for your goods and services online. This could be a simple website or a social media page with links to a payment provider.
2. Finance Management Involves A Lot of Software
Nowadays, even the largest enterprises rely on pieces of software such as Quickbooks and Peachtree to manage their finances. These accounting tools enable account reports to be generated instantly and integrate seamlessly with bank accounts and payment platforms to accurately track your income and expenses, as well as manage your employee payroll, inventory, and stock-keeping. You should do research to find out what tools work best for you, and take advantage of them right away.
3. New Forms of Currency
It’s impossible to neglect a very recent and disruptive development in the financial industry: cryptocurrency. These digital currencies are created and stored on decentralized computer networks called blockchains, and their value is entirely dependent on market forces. Despite their novelty and inherent volatility, the most popular ones such as Bitcoin and Ethereum are already being adopted as payment options by many businesses globally. They have, in turn, spawned a cottage industry for items such as NFTs (non-fungible tokens), decentralized games, cloud storage, crypto fintech, and many more.
If you’re looking to get involved with cryptocurrency and other forms of digital assets, then you need a banking partner you can trust. Western Alliance Bank is one such bank, with years of industry experience, as well as an expert team well-versed in all things financial technology and digital banking solutions.
4. Computer Algorithms Are Being Used to Maximize Profits
As computers have become more powerful, trading firms on Wall Street have begun to leverage the power of computer science and machine learning to analyze market trends and make trades to maximize profit. This is known as quantitative or algorithmic trading, and it presents a great opportunity to improve returns on investments. Many businesses are finding ways to insert technology into their decision-making processes, as computers offer the advantage of speed and accuracy, as well as being data-driven.
5. Cybersecurity is a Major Focus Point
Today’s news is full of classified business data leaked by hackers and malicious third parties. As businesses integrate digital technology into their accounting and financial workflows, more efforts and resources are being invested in cloud security and data integrity to ensure that confidential business and customer information is kept private.
Stepping into the Future With Digital Technology in Banking
Every business—including yours—stands to benefit from adopting technology into its financial and banking strategies. Find ways to integrate technology into your organization, or provide digital solutions to your customers, and you will begin to reap the rewards.