It has been a long time since people stopped using the banking service as they had depended on it completely for some years. Gone are the days we plan a bank visit day and that long-awaited queue. What happened to this culture and what really brought in the change?
The simple yet constructive answer to this is FinTech revolution; yes the all-round development of the financial technology is the cause of this drastic shift from real banking experience to an on-going successful virtual banking experience. This is very much possible with the introduction of mobile banking applications, payment gateways and the regular cash transfers through other applications.
This upgraded technology also called for some financial risk along with it, which had to be dealt with in very efficient manner and this was an upturn towards lookout for what could be the clear-cut ways to do so. Now all the Companies have formulated a separate team of personnel for this purpose. Keeping in mind the role and importance of financial risk management the supportive factors are discussed here. This will support your better understanding.
Factors for risk management:
- Huge Market: technology has also lead to growth in the market size in general, we can witness the emergence of many start-ups which are doing a really amazing job in every sector. With this the increase of the financial role and also the financial risk increases.
The risk management team has to validate and benchmark on standards to be preventive and work safely. Another point to understand is that there is a huge opportunity for the growth of cybersecurity platform as there are varied organizations which require unique functions for their security to be maintained. Hence it is indeed important to keep in line with the technology and also the methods to make it function in a smooth and effective manner.
- Artificial intelligence: as we are aware this is a very effective feature of risk management in the financial sector. Its ability to handle the huge volume of data is the unique and the best reason for opting for AI. With the emergence of technology, there could be some loopholes which need proper attention, hence AI proves to be a good support system at such times. It helps to make the process easy and less stressful. For example, when there is an online loan application, the verification process has become very well scheduled with many parameters which completely prevent fraudulent activity.
Hence with all that growth into the booming future, let us have the focus also on the regulation of clear management methodologies also to ensure the real fruits of success.