Datamation content and product recommendations are editorially independent. We may make money when you click on links to our partners. Learn More.
There’s a lot of buzz is surrounding blockchain in fintech (financial technology) circles, but the securities industry is paying more attention to artificial intelligence (AI) and machine learning, at least over the new few years.
In terms of fintech innovations that will have the most impact on their businesses in both the near term (two to three years) and medium term (three to five years), AI takes the top spot (30 percent), according to a recent a study from Investor communications specialist Mediant. Institutional tools that enable firms to unify and manage their existing processes also ranks high in the near term (30 percent), but drops significantly in the short term (18 percent).
Blockchain, the distributed ledger technology best known for its implementation in Bitcoin and other cryptocurrencies, isn’t expected to have as strong an impact over the next two to three years (13 percent), but its influence is expected to grow over the next three to five years (24 percent).
In the near term, institutional tools (37 percent) will have the biggest impact on workers’ individual roles, followed by AI (24 percent), personal finance and wealth management platforms (17 percent) and blockchain (15 percent).
Meanwhile, fintech spending is on the upswing among firms that trade in stocks, bonds and other investment instruments.
Seventy-eight percent of organizations invested more in technology in 2017 than in 2016, while only 15 percent reported that their spending had flattened out. Only three percent trimmed their budgets in 2017.
The top reasons organizations are investing in new fintech solutions include managing operational risk (30 percent), keeping up with a changing regulatory landscape (25 percent) and achieving cost efficiencies. Further down the line, priorities include meeting investor communication needs (14 percent) and tackling cybersecurity threats (10 percent).
“The survey results in the 2017 Trends in Fintech and Investor Communications report show that in years to come, fintech will continue to be crucial for reducing costs, optimizing internal processes, maintaining regulatory compliance, and meeting investors’ needs,” said Stacey Robinson, Chief Technology Officer of Mediant, in a statement.
Mediant’s findings somewhat echo a recent report from the Association for Financial Professionals (AFP). The group found that blockchain and AI adoption rates are low among finance and treasury professionals, currently standing at one and two percent respectively. More than half (51 percent) said their organizations have no plans to implement blockchain.
Pedro Hernandez is a contributing editor at Datamation. Follow him on Twitter @ecoINSITE.
