Everyone is aware that the internet and technology, in general, are disrupting the flow of most industries and even entire markets. Technology is one of the most influential factors in our lives today; introducing a single device, such as the smartphone, has entirely changed how we communicate, purchase, learn, and even sell things. However, the thing that is of interest to most people is how technology will influence money, financial markets, and our economic well-being at large?
As a business owner, investor, or job goer, it’s in everyone’s best interest to know the kind of impact technology can have on our lives in terms of finances. However, considering how broad of industry finance is, it’ll help narrow our focus on a few key sectors of this industry.
1. Banking
Banking is the backbone of any economic environment. Banks are a way to source funds for both sellers and buyers, but they are also essential to carry out basic transactions. Banks have been rapid in adopting banking software as it helps them reduce costs while increasing functionality. These benefits are also carried forward to businesses and business clients as they use banking services. More importantly, while there are advantages, there are also drawbacks, the biggest of which is digital security. With more people making online purchases because of convenience, fewer people are paying attention to how they can make these transactions safe. Banking is definitely getting easier, but people still need to know how to do these things safely.
2. Real Estate
One of the biggest pieces of the financial pie is taken up by real estate and commerce pertaining to physical property, whether it is domestic or commercial. While there are several reasons why the real estate market is booming, one of the big influencing factors is how easy it is for people to trade properties. Through the internet, people are no longer only selling to local clients, but rather, they can advertise their properties to a national and even international audience. Combined with the fact that the internet has made these marketing strategies cheap and even free in many cases, there is no reason for sellers and buyers not to use this option. Many people are now doing real estate deals as an extra source of income since it is so easy to find, list, and sell properties through digital mediums. As the internet grows and technology finds its way into the hands of more users, we are likely to see this trend grow in the future.
Even though the recent turbulence that we have seen in stock markets worldwide, it is still a very big industry and one that affects a lot of people all over the world. While technology can do little to directly influence the market, the access to the stock market that it affords to the average person has a big indirect effect on it. Rather than physically going to the stock exchange, people now use trading apps that allow them to perform all of their tradings directly from their phones. This convenience, combined with the latest digital payment solutions, means it’s easier than ever for the average purchase to start stock trading. The stock markets are seeing a lot of mobile activity, and this is, in turn, driving stock markets to new highs as there are just so many people in the market to buy and sell. With more advanced services such as AI-assisted trading also coming to the market, we can see stocks growing in popularity in the future.
3. Digital Currency
Digital currency is a financial asset that depends entirely on technology for everything, from its creation to its existence to its liquidation. This is truly a modern financial tool that incorporates a plethora of technologies to function. As major corporations and even governments begin to regularize the use of digital currencies, we are likely to see this asset increase in value and usage across the world as well. Digital currencies are a completely new way for people to invest, and even though people might be a little hesitant today, they will change the way markets operate in the near future.
The main challenge with speculating the potential changes to the financial industry due to technology is the fact that technology itself is so volatile. At times it can enhance a sector, whereas other times, it can completely eliminate an entire portion of the financial industry. Moreover, technology also has a big impact on individual businesses, so as technologies change, businesses change with it. There is no denying that technology is not only here to stay but that its roots as well are getting deeper into every industry and sector of the global economy.
