New technologies like artificial intelligence (AI), 5G, distributed ledger technologies and quantum are transforming financial services which can offer new possibilities to both consumers and financial institutions, said World Economic Forum (WEF).
A report published on the WEF website said, "While financial executives largely recognize the promise of emerging technologies, many financial services firms are struggling to develop comprehensive innovation strategies given the sheer number of technologies maturing in the industry."
According to the report, as a result of the emergence of new technologies, customers will see new financial services and products such as just-in-time lending, outcome-based investment products, data-linked green bonds etc.
"Financial institutions will need to be fundamentally different in order to take full advantage of the opportunity technologies offer," the report said.
The report highlights four innovation pathways to be explored by the financial institutions- establishing ecosystems beyond finance, integrating physical and digital processes, reorienting transaction flows, and reimagining core functions.
Drew Propson, head of technology and innovation in financial services, World Economic Forum, said, "It is not sufficient to look at individual technology implementations. Financial services firms must consider the benefits derived from the coordinated deployment of emerging technologies to unlock the full potential of these technologies."
The report took its information from more than 200 interviews and nine international workshops over the past year as part of the WEF's AI in Financial Services project.