Post by lizaseo11 on Nov 9, 2024 5:21:50 GMT 1
Russia is among the leading countries in terms of fintech penetration. The market is growing year after year, despite the geopolitical crisis and sanctions. The market volume in Q2 2024 was 56.2 billion rubles — 10.5% more than in the same period in 2023. The growth is due to the development of its own IT infrastructure and the active implementation of artificial intelligence in all business processes. In the article, we talk about new technologies and innovations in the banking sector.
Innovative technologies in banking
New banking technologies have provided users with simple and convenient access to financial transactions. And the transition from traditional servicing to a digital office has helped banks optimize costs, improve service, and increase customer loyalty.
Simple payments
Over the last 2 years, competition has been focused on modern payment technologies of banks. People are used to paying with one touch, and the market had to look for alternatives: pay services, QR codes, biometric payments, NFC stickers for phones.
There has also been an increase in demand for payment services, which include BNPL services, where the cost of a purchase is divided into equal shopify website design parts and paid over one or two months, and peer-to-peer payments.
Audience segmentation
Segmentation is another innovation in banking that is growing stronger year after year. Businesses strive to offer a narrow audience a solution created specifically for their needs. For example, services for managing a family budget and children's banking.
Artificial intelligence
AI is far from a new technology in the banking sector. In 2024, 95% of Russian companies already use it for credit scoring, improving security and increasing the efficiency of business processes.
But it is assumed that the heyday of the technology is yet to come. Companies are moving from scoring to personalization of service and assessment of emotions. The system based on machine learning technologies recognizes behavioral patterns in the client's transactions and their interests in modern banking products and services in a mobile application almost in real time.
At Alfa Bank, artificial intelligence analyzes data on where to open new branches. And Otkritie uses AI to schedule employees who do sales. This way, clients can find out in advance what time is convenient for visiting.
Cybersecurity
Another trend is continuous cyber threat management. Banks continue to improve the quality of anti-fraud procedures and establish the detection of customer behavior anomalies using AI and related technologies - machine learning, collection and processing of big data, open APIs.
Low-code
Low-Code is another promising digital banking technology. — The approach allows for the release of fully functional solutions quickly and with a minimum amount of written code. In essence, the development process becomes similar to building from a construction set, in which all the parts fit together.
Examples of using low-code in the banking sector:
Mobile app development - rapid development of new features and adaptation to different devices.
Chatbot development – automation of customer service, provision of round-the-clock support.
Creating personalized offers – analyzing customer data and providing them with customized digital banking products.
Digital ruble
The digital ruble is an electronic version of the Russian national currency, developed by the Central Bank of Russia. It will become an additional means of payment along with cash and non-cash rubles. The digital ruble will allow for instant and secure transactions, improve the availability of financial services, and increase the transparency of transactions. Its key advantage is integration with government services and minimization of fees for transfers.
Digital ruble logoDigital ruble logo
According to the head of the Central Bank, Elvira Nabiullina , the start of large-scale implementation of digital currency will begin in the summer of 2025.
Digital financial assets
Digital financial assets, or DFAs, are new instruments in the financial market that represent rights to assets in electronic form. They include tokens, which are digital units that secure rights to property, securities, or monetary claims.
A token is a type of digital asset created on the blockchain that verifies ownership or the right to use a specific asset. Tokens come in different types, such as investment or utility tokens, depending on their purpose.
Regulation of digital financial assets in Russia began with the adoption of the law "On digital financial assets" in 2020. The law introduces a legal basis for working with digital assets, regulates their issuance and circulation, and defines legal requirements for market participants, including exchange operators and issuers. This helps to increase transparency and reduce the risk of fraud.
The growth of digital financial assets issuance in Russia demonstrates that more and more companies are using digital assets to attract investment. In 2023-2024, the number of issued tokens increased significantly, including those of large companies and banks. With the introduction of regulation and interest in blockchain technologies, digital financial assets are becoming a popular tool for raising capital and improving the transparency of financial processes.
DFAs play an important role in the development of the digital economy, facilitating investments and exchange of assets in electronic form, providing new opportunities for market participants.
Payments in virtual and augmented reality
Payments in virtual and augmented reality open up new possibilities for shopping in digital worlds. Users will be able to make transactions without leaving the VR/AR environment using gestures, voice or gaze. This simplifies the payment process and creates a more interactive experience, especially in games, virtual stores and educational platforms.
Mobile Banking Trends
Today, a mobile application for Android or iOS is the main means of attracting and retaining users. More than half of customers prefer to use bank services through an application. Therefore, the main task of a business is to increase functionality using innovative banking technologies.
Personalization
Banks will continue to expand their analytics capabilities to get to know the user better. Collecting customer data to create customized offers and improve user experience, transferring interactions with the bank and functions of a physical office online, and forming an ecosystem approach are some of the main trends in the segment.
Fast payment system
The Fast Payment System, or FPS, is a service of the Bank of Russia that allows users to make instant transfers between accounts in different banks. The system ensures convenience and speed of payments, and also reduces the cost of transfers, which makes it attractive for both users and businesses.
SBP has been actively developing since 2019. Today, its arsenal includes payment for goods and services using a smartphone via a QR code, NFC, button, link and from a linked account.
Mobile Internet Banking
Most official applications of Russian banks are not available in the App Store and Google Play. Companies diligently circumvent restrictions and add new versions, but they are quickly removed. Therefore, some users have migrated from mobile banks to web applications, which provide customers with functionality and convenience similar to traditional ones, but work through a browser.
Over the 2 years of sanctions, banks have made a serious step forward in the development of web applications. Today, the web offers a standard set of functions: opening new banking products, transfers, support.
Some banks have made a serious step forward. Their web has almost completely adopted the functionality of the mobile application:
Alfa-Bank has implemented the function of opening a joint account and scanning passport data when a new client orders a product.
Gazprombank added a chat and the ability to dispute a card transaction.
In the T-Bank web application, you can apply for an installment plan, become self-employed, and provide access to your account.
Chatbots
Chatbots still have a reputation for being a tool for solving simple problems, and when it comes to a complex issue, the user does not even try to delegate it to a text robot and immediately asks to be transferred to a human operator - despite the fact that the bot can handle it quite well.
The chatbot for entrepreneurs from PSB can issue invoices, pay taxes and fines, repeat payments from history, and issue a pre-approved loan. The tool covers basic business needs.
Banks will continue to develop chatbots that simulate a conversation with a real person and are aimed at instantly responding to a request.
Stories
Banks create content platforms within their applications with informational messages, individual offers and useful services.
Banks use stories to promote their products, talk about useful functions, and introduce new features. And some successfully integrate not only financial but also non-banking services — air tickets, insurance, event tickets, and sales of goods.
Digital accessibility
Access to financial services is an important part of an adult’s life. Everyone can face limitations – an injury, a trip behind the wheel, a small child in their arms.
More than half of the population in Russia has special needs: 13 million people with disabilities, 37 million pensioners, and approximately 30 million people with temporary health restrictions. By creating accessible mobile applications for iOS and Android, banks meet the needs of half of the country's population. This is not only social responsibility for the bank, but also a competitive advantage.
Open Banking API
In the last two years, one of the banking innovations has been Open Banking technology. It opens up many opportunities for banks:
- Improves customer engagement and retention rates.
— Allows you to collect and analyze more information about your customers and offer them personalized services.
— Deeper scoring allows banks to issue more loans at favorable rates, which can attract additional audiences.
For users of banking services, Open Banking primarily means an increase in the quality of services. For example, an increase in the speed of processes and more user-friendly interfaces, an expansion of the product line and a convenient search for favorable offers.
What's the bottom line?
In conclusion, 2024 has become a landmark year for the banking sector in Russia, demonstrating a noticeable development in banking technologies. Artificial intelligence, fast payments and low-code not only increase efficiency, but also make financial services more accessible and personalized for customers. The introduction of digital financial assets and the digital ruble opens up new horizons for investment and simplifies financial transactions.
Competition in the mobile banking market is intensifying, and banks are actively looking for ways to attract and retain customers through user-friendly web applications, chatbots, and content platforms. The focus on digital accessibility and open banking highlights banks’ desire not only to improve their efficiency, but also to provide quality service to all categories of users.
Thus, current trends in banking technologies are shaping not only the future of financial services, but also creating new opportunities for businesses and customers, making the fintech market dynamic and promising.
Innovative technologies in banking
New banking technologies have provided users with simple and convenient access to financial transactions. And the transition from traditional servicing to a digital office has helped banks optimize costs, improve service, and increase customer loyalty.
Simple payments
Over the last 2 years, competition has been focused on modern payment technologies of banks. People are used to paying with one touch, and the market had to look for alternatives: pay services, QR codes, biometric payments, NFC stickers for phones.
There has also been an increase in demand for payment services, which include BNPL services, where the cost of a purchase is divided into equal shopify website design parts and paid over one or two months, and peer-to-peer payments.
Audience segmentation
Segmentation is another innovation in banking that is growing stronger year after year. Businesses strive to offer a narrow audience a solution created specifically for their needs. For example, services for managing a family budget and children's banking.
Artificial intelligence
AI is far from a new technology in the banking sector. In 2024, 95% of Russian companies already use it for credit scoring, improving security and increasing the efficiency of business processes.
But it is assumed that the heyday of the technology is yet to come. Companies are moving from scoring to personalization of service and assessment of emotions. The system based on machine learning technologies recognizes behavioral patterns in the client's transactions and their interests in modern banking products and services in a mobile application almost in real time.
At Alfa Bank, artificial intelligence analyzes data on where to open new branches. And Otkritie uses AI to schedule employees who do sales. This way, clients can find out in advance what time is convenient for visiting.
Cybersecurity
Another trend is continuous cyber threat management. Banks continue to improve the quality of anti-fraud procedures and establish the detection of customer behavior anomalies using AI and related technologies - machine learning, collection and processing of big data, open APIs.
Low-code
Low-Code is another promising digital banking technology. — The approach allows for the release of fully functional solutions quickly and with a minimum amount of written code. In essence, the development process becomes similar to building from a construction set, in which all the parts fit together.
Examples of using low-code in the banking sector:
Mobile app development - rapid development of new features and adaptation to different devices.
Chatbot development – automation of customer service, provision of round-the-clock support.
Creating personalized offers – analyzing customer data and providing them with customized digital banking products.
Digital ruble
The digital ruble is an electronic version of the Russian national currency, developed by the Central Bank of Russia. It will become an additional means of payment along with cash and non-cash rubles. The digital ruble will allow for instant and secure transactions, improve the availability of financial services, and increase the transparency of transactions. Its key advantage is integration with government services and minimization of fees for transfers.
Digital ruble logoDigital ruble logo
According to the head of the Central Bank, Elvira Nabiullina , the start of large-scale implementation of digital currency will begin in the summer of 2025.
Digital financial assets
Digital financial assets, or DFAs, are new instruments in the financial market that represent rights to assets in electronic form. They include tokens, which are digital units that secure rights to property, securities, or monetary claims.
A token is a type of digital asset created on the blockchain that verifies ownership or the right to use a specific asset. Tokens come in different types, such as investment or utility tokens, depending on their purpose.
Regulation of digital financial assets in Russia began with the adoption of the law "On digital financial assets" in 2020. The law introduces a legal basis for working with digital assets, regulates their issuance and circulation, and defines legal requirements for market participants, including exchange operators and issuers. This helps to increase transparency and reduce the risk of fraud.
The growth of digital financial assets issuance in Russia demonstrates that more and more companies are using digital assets to attract investment. In 2023-2024, the number of issued tokens increased significantly, including those of large companies and banks. With the introduction of regulation and interest in blockchain technologies, digital financial assets are becoming a popular tool for raising capital and improving the transparency of financial processes.
DFAs play an important role in the development of the digital economy, facilitating investments and exchange of assets in electronic form, providing new opportunities for market participants.
Payments in virtual and augmented reality
Payments in virtual and augmented reality open up new possibilities for shopping in digital worlds. Users will be able to make transactions without leaving the VR/AR environment using gestures, voice or gaze. This simplifies the payment process and creates a more interactive experience, especially in games, virtual stores and educational platforms.
Mobile Banking Trends
Today, a mobile application for Android or iOS is the main means of attracting and retaining users. More than half of customers prefer to use bank services through an application. Therefore, the main task of a business is to increase functionality using innovative banking technologies.
Personalization
Banks will continue to expand their analytics capabilities to get to know the user better. Collecting customer data to create customized offers and improve user experience, transferring interactions with the bank and functions of a physical office online, and forming an ecosystem approach are some of the main trends in the segment.
Fast payment system
The Fast Payment System, or FPS, is a service of the Bank of Russia that allows users to make instant transfers between accounts in different banks. The system ensures convenience and speed of payments, and also reduces the cost of transfers, which makes it attractive for both users and businesses.
SBP has been actively developing since 2019. Today, its arsenal includes payment for goods and services using a smartphone via a QR code, NFC, button, link and from a linked account.
Mobile Internet Banking
Most official applications of Russian banks are not available in the App Store and Google Play. Companies diligently circumvent restrictions and add new versions, but they are quickly removed. Therefore, some users have migrated from mobile banks to web applications, which provide customers with functionality and convenience similar to traditional ones, but work through a browser.
Over the 2 years of sanctions, banks have made a serious step forward in the development of web applications. Today, the web offers a standard set of functions: opening new banking products, transfers, support.
Some banks have made a serious step forward. Their web has almost completely adopted the functionality of the mobile application:
Alfa-Bank has implemented the function of opening a joint account and scanning passport data when a new client orders a product.
Gazprombank added a chat and the ability to dispute a card transaction.
In the T-Bank web application, you can apply for an installment plan, become self-employed, and provide access to your account.
Chatbots
Chatbots still have a reputation for being a tool for solving simple problems, and when it comes to a complex issue, the user does not even try to delegate it to a text robot and immediately asks to be transferred to a human operator - despite the fact that the bot can handle it quite well.
The chatbot for entrepreneurs from PSB can issue invoices, pay taxes and fines, repeat payments from history, and issue a pre-approved loan. The tool covers basic business needs.
Banks will continue to develop chatbots that simulate a conversation with a real person and are aimed at instantly responding to a request.
Stories
Banks create content platforms within their applications with informational messages, individual offers and useful services.
Banks use stories to promote their products, talk about useful functions, and introduce new features. And some successfully integrate not only financial but also non-banking services — air tickets, insurance, event tickets, and sales of goods.
Digital accessibility
Access to financial services is an important part of an adult’s life. Everyone can face limitations – an injury, a trip behind the wheel, a small child in their arms.
More than half of the population in Russia has special needs: 13 million people with disabilities, 37 million pensioners, and approximately 30 million people with temporary health restrictions. By creating accessible mobile applications for iOS and Android, banks meet the needs of half of the country's population. This is not only social responsibility for the bank, but also a competitive advantage.
Open Banking API
In the last two years, one of the banking innovations has been Open Banking technology. It opens up many opportunities for banks:
- Improves customer engagement and retention rates.
— Allows you to collect and analyze more information about your customers and offer them personalized services.
— Deeper scoring allows banks to issue more loans at favorable rates, which can attract additional audiences.
For users of banking services, Open Banking primarily means an increase in the quality of services. For example, an increase in the speed of processes and more user-friendly interfaces, an expansion of the product line and a convenient search for favorable offers.
What's the bottom line?
In conclusion, 2024 has become a landmark year for the banking sector in Russia, demonstrating a noticeable development in banking technologies. Artificial intelligence, fast payments and low-code not only increase efficiency, but also make financial services more accessible and personalized for customers. The introduction of digital financial assets and the digital ruble opens up new horizons for investment and simplifies financial transactions.
Competition in the mobile banking market is intensifying, and banks are actively looking for ways to attract and retain customers through user-friendly web applications, chatbots, and content platforms. The focus on digital accessibility and open banking highlights banks’ desire not only to improve their efficiency, but also to provide quality service to all categories of users.
Thus, current trends in banking technologies are shaping not only the future of financial services, but also creating new opportunities for businesses and customers, making the fintech market dynamic and promising.