From digital currencies to non-fungible tokens (NFTs), emerging technologies can streamline workflows, supercharge growth and unlock new streams of revenue. Digital transformation is disrupting nearly every industry, and the financial services sphere is no exception: Singapore, specifically, is home to about 50,000 new start-ups a year, of which about 5,000 are tech start-ups. And of these 5,000, about 1,500 reside in the fintech space, notes Dr Patrick Thng, Singapore Management University (SMU) Senior Lecturer of Information Systems and Director of the Master of IT in Business (MITB) programme, Financial Technology and Analytics track.
“Singapore has a thriving start-up ecosystem comprising venture capitalists and investor accelerators,” says Dr Thng.
It is a brave new world for the fintech industry, and financial professionals need to stay ahead of the curve and take advantage of this tremendous growth. We chat more with Dr Thng to learn why the fintech industry is an investors’ thematic focus, brimming with career opportunities.
The digital transformation of the financial services industry
For a long time, traditional financial institutions have been struggling to keep up with the pace of innovation; and investors, customers and other stakeholders are seeking alternatives for their financial needs. This motivation, coupled with the rise of innovation, has triggered the fintech revolution.
“We cannot just see fintech and emerging trends as a standalone phenomenon. We need to consider shifting global trends, financial services trends, and technology trends,” explains Dr Thng, during a recent brown bag workshop organised by education platform Headhunt.
Fintech is often seen as disruptive, providing innovative solutions to problems that traditional financial institutions have not addressed. According to the World Bank, nearly 1.7 billion people are unbanked. Fintech can help provide the unbanked population access to financial products and services typically only available to people with traditional bank accounts.
With a surge in technological breakthroughs, the demand for fintech skills is on track for exponential growth.
With the emergence of sensor technology in the Internet Of Things, a large volume of data can be captured and better understood through sophisticated analytical tools and techniques. Meanwhile, blockchain technology can provide a secure and transparent system for recording transactions, help to reduce fraud and increase trust between financial institutions and their customers.
Areas of opportunity
If there is one thing the financial industry is pressured to focus on in recent years, it is innovation. From developing new products to streamlining processes, the sector is now at the forefront of change.
The rise of end-to-end digital banking encompasses every interaction that a customer has with their bank. From account opening and funding to transactions and payments, end-to-end digital banking requires fintech solutions that can provide a seamless experience and support omnichannel interactions.
“The best banks in the world manage their risks well,” says Dr Thng.
Currently, the designers of “black box” AI algorithms do not have the luxury of time to explain how or why machine learning decisions were derived. The Explainable Artificial Intelligence (XAI) systems can clarify decision-making processes to human users. This is important because as AI becomes more widespread and adopted in critical applications such as healthcare, finance, or manufacturing, users of these technologies need to be able to trust that the decisions made by the systems are correct and fair.
“With explainable AI, we’ll be able to illustrate to auditors, bankers and prospective customers what’s taking place in the black box model that banks adopt when running their AI applications,” adds Dr Thng.
Skills to thrive in a fintech future
Organisations at the forefront of innovation are constantly looking for talented individuals in such fast-moving industry, digital banking and technology skills are a must to drive change.
The financial services industry has been undergoing transformational changes, especially in the last decade, due to new competition, stringent regulations and digitisation, and the MITB programme equips professionals with the state-of-the-art skills to help push the envelope for financial institutions in this new era.
All businesses, especially financial institutions, need to be customer-centric to meet their changing needs and address their pain points. Dr Thng emphasises how fintech professionals can empower their organisations to lead the pack through customer journey mapping and a strong understanding of the customer experience.
“Many new fintechs are adopting what we call agile systems development — which comes from the notion that each mini development phase must produce some functional deliverable before moving to the next phase,” observes Dr Thng.
Data analytics too plays a vital role in the field of finance by aiding financial institutions to make better decisions and improve their operations. Consequently, MITB equips its students to master the programming language and apply diagnostic and descriptive data analysis.
“I’m confident that the SMU MITB programme will equip you with many of these key skills to navigate contracts, fundraising, and other essential competencies for running a start-up,” says Dr Thng.
To leapfrog your career, enroll in SMU’s MITB programme which will prepare you to lead digitalisation initiatives and seize opportunities in fintech.
Visit smu.sg/mitb to learn more about thriving in this age of digital disruption.
