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by Yap Heng Kiong
According to the EY FinTech adoption index – Germany Key findings, of the 623 responses, globally, only 1.8% cited trust as the key reason to choose FinTech services over a traditional institution.
Many Fintech solutions such as those based upon Blockchains infrastructure and Bitcoin payments have changed how customers access financial services and products. Consumers are being moved away from highly regulated financial services towards more decentralised systems. So does adopting this new Fintech ecosystem really poses no trust and security issues? Or consumers are just so bedazzled by the other aspects of Fintech such as ease of use and more attractive rates that trust and security issues are being neglected? Just this year, I received a SMS alert notice from a local bank informing me of a suspicious transaction of one my credit cards making a purchase online. The transaction, however, did not go through due to the missing credit card verification value. Can such frauds be similarly prevented in Fintech solutions such as Blockchain? Blockchain is the public ledger network which keeps track of the balances for all users and updates them as Bitcoins changes hands. In a decentralised system, consumers need to understand the importance of having greater control over security as no single entity is trusted to verify any form of transactions. This can be seen from the fall of the largest Bitcoin Exchange, Mt. Gox in 2014, which caused the lost of over 460 million dollars worth of Bitcoins, reportedly stolen by hackers. How safe then are Fintech solutions? Since the arrival of social media networking, you begin to realise that every time you engage in an online activity telling people where you are, or asking for recommendations around you, you give up some of your privacy such as your location. Similarly almost all Fintech solutions involve obtaining customer’s private data to generate useful financial insights. Customer's private data are also collected to better predict customers' needs and to provide better user experience. Can Fintech companies provide better customer experience and yet able to protect their customers against cyber threats? Fintech companies are increasingly gaining more control over their customers' financial information and data through the use of technology. To help Fintech companies better protect their stakeholders, more are adopting higher protection such as multi-factor authentication and One-Time-Passwords to minimise the overall risk.
With fast growing popularity of Fintech solutions, the financial services industries are well becoming a major target for cyber crimes. The challenge facing most fintech companies just like the other financial institution is how to keep the customer’s data secure. Fintech solution providers should focus more on risk management and making sure that Fintech business is secured enough to ensure safe banking and financial services are delivered.
Resources:
http://www.techbullion.com/safe-fintech-ecosystem-infrastructure-money-markets/ https://www.wired.com/2014/03/bitcoin-exchange/
2 Comments
4/1/2020 09:28:04 pm
easy to set up account and i can quickly get the credit
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4/1/2020 09:38:08 pm
i hope with the easier all proces can get rate more down
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