DIGITALIZATION AND INNOVATION IN THE FINANCIAL SECTOR: CURRENT TRENDS AND PROSPECTS

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DIGITALIZATION AND INNOVATION IN THE FINANCIAL SECTOR: CURRENT TRENDS AND PROSPECTS

Abstract: The article examines the impact of digitalization on the financial services industry and the flourishing of innovations in this area. The changes that have occurred in traditional monetary institutions and the emergence of innovative startups are investigated. Research data from UBS and BCG confirms the increase in fintech revenues and the growth in the use of digital services by customers. The article also presents the findings of the discussion of financial sector leaders at the WeWork Innovation Summit and examples of successful use of technology in the banking industry, such as Natwest and Uala.

Keywords: digitalization, financial services, innovations, fintech, mobile banking, startups, technologies.

Digitalization has brought fundamental changes to the financial services industry. With these changes, traditional monetary institutions have also evolved to respond more quickly to customer needs. In addition, innovative startups are emerging one after another, providing digital services to customers around the world. According to a UBS study, by 2030, the global revenue of financial technology ("fintech") companies will reach $500 billion, up from $150 billion in 2018.

The COVID-19 pandemic has further accelerated this trend. According to a BCG study, from February to June 2020, mobile banking usage increased by 34%, while branch usage decreased by 12%. Now more than ever, bank customers expect to receive services from their smartphones and laptops, wherever they are.

The WeWork Innovation Summit was moderated by Nick Giraudeau, WeWork's Global Head of Financial Sales, and featured a discussion among the three leaders about innovation happening in the financial sector. Panelists spoke about the challenges faced by both fintech technologies and traditional monetary institutions, as well as the future of financial innovation.

Andy Ellis, head of venture capital at Natwest, has used technology to help NatWest Bank grow at a faster pace. "Eight or nine years ago, many banks were hesitant to adopt changes for fear of system downtime," Ellis says. "Now it's all about continuous code deployment and modern architecture."

By launching a digital product at NatWest Bank, Ellis shows the organization that "quick action is possible" by combining institutional banking knowledge with the dynamic energy of a startup.

Innovation is needed to lower the barrier to entry for startups like Argentina's Uala. The company uses technology to effectively scale its operations and has grown to manage

more than 3 million accounts with about 600 employees. Pierpaolo Barbieri, founder and CEO, says that the spread of technology and the improvement of mobile applications are essential to expanding the company's business opportunities.

"Digitalization has been a challenge [in the financial industry] for a long time," "but since the app revolution began, barriers to entry due to KYC (Know Your Customer) and AML (Anti-Money Laundering) issues have increased. solved thanks to advances in field technology.

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