The Current Fintech Landscape in 2023 & Future Expectations

Holding an MBA in Finance & Corporate Strategy from Management Development Institute, Gurgaon, Parag has been associated with Nucleus Software for over 23 years now and has played an instrumental role in crafting efficient business strategies for the company and guiding it towards the pinnacle of success. In a recent conversation with Siliconindia, Parag Bhise, CEO, Nucleus Software gave us an insightful overview of the fintech landscape so far this year, and discussed its future prospects entering the New Year. Below are the excerpts from the exclusive interview

Share your thoughts on the fintech landscape so far in 2023.

Post covid, there has been a serious transformation happening in the industry, wherein it has done really well and bounced back to its old glory. The organizations have achieved the required profitability, and there has been a robust credit score and asset quality as well, which was all possible due to underlying technologies. Digitization has been a true enabler for the financial services industry both during and post-covid. The growth that the BFSI segment has achieved can be attributed to the technology support that it has in place.

Throw some light on the major concerns fintech organizations had while entering 2023. How is the scenario now?

The primary concern for tech organizations back then was an extremely dynamic changing tech environment coupled with numerous fintechs entering the market and evolving customer demands. The demands and expectations were changing very quickly, and the industry was expected to respond to them at a faster pace. However today, the situation has stabilized a bit, but there is an urgent requirement for the robustness of fintech solutions. Also, organizations are now required to balance between being dynamic, robust and scalable.

According to you, what were the most significant advancements for the fintech industry in 2023?

Putting it broadly since it covers a humongous number of aspects and use cases, digitization has been the most significant development our industry has witnessed in 2023. BFSI companies are enhancing their digital landscape very significantly by using APIs, STPs and by integrating with various fintechs who have entered the market recently. This way, they are striving to have a strong digital strategy in place to achieve optimum business growth. We have even seen few of our clients growing multifold in just one year due to their digital business strategy. Such is the power of digitization and having a robust digital strategy in place. On the other hand, while there has been a lot of hype about Gen AI, I feel it will still take a while before the real use cases of this technology is realized to derive potential value for businesses.

Going forward into a new year, how do you expect tech usage to evolve in 2024?

With an increasing number of use cases coming to the fore, Gen AI is expected to start witnessing widespread adoption in 2024. The use of chatbots by BFSIs for customer support will increase even further, and these chatbots will evolve to the next level by leveraging Gen AI technology. As a result, they will become more intelligent, efficient and might even become capable to take a few decisions on behalf of the customers. Secondly, the use of Advanced AI methods to detect and prevent frauds will become mainstream. Although a lot of research has been happening in this area for some time, I feel now is the right time to use these techniques.

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