Change is a necessity for development and progress. In this day and age, the role of finance is going through major evolution. It is a new age which means that finance professionals are facing a new array of challenges, risks, and responsibilities. New technologies are changing the game of how things used to work. And customers are going with the flow.
On the other hand, if you have a financial firm, be ready to run with the changes to ensure you keep your customers and a place in the market. Financial firms have to find new ways on how they can take up their new roles in a modern environment.
The Financial Trends You Need To Know
If you run a business, and are looking for a short term role to help you tide over shortage of business funds, knowing the latest finance trends can help you quite a bit.
Here are a few emerging trends that you need to know.
- The evolving CFO role.
The role of the Chief Financial Officer has gone through some major changes over the past few years. Corporations rely a lot on the prowess of the CFO from the bean counter to the boardroom.
CFOs are facing new challenges and risks. In the past, there have been major scandals where their roles were scrutinised. Thus they always have to live up to the boardroom and customer needs.
The role of a CFO has been changing due to some reasons. They include the following.
- The growth of technology.
Technology is one of the most important external forces to shape businesses. Technology is everywhere, thus, CFOs need to be wary of the emerging changes that take place in the technological sector.
- The declining importance of the role of COO.
In most corporations, the role that used to be the COO’s, has been divided between the CEO and CFO. The CEO takes over management, operational backgrounds and supply responsibilities. On the other hand, the CFO is in charge of IT and procurement.
- Increased interest rates.
High rates of interest have been some of the trends to take the financial sector by storm. As the rates of interest rise, the financial institutions, such as banks get higher profits.
These rates can increase where there are strong economic environments. In such a space, the demand for a consumer base is always rising, and the need for loans. If loans increase, banks become augmented in the process. High-interest rates have an impact on the growth of the economy, price of the currency, and profitability in business assets. If you are looking for money or loans, you need to ensure that you will not end up paying a high interest rate.
- Fee-based fiduciary investment ideas.
Investors are becoming more financially aware of how they get compensated. A fee-based investor refers to a hybrid advisor, who can charge fees, as well as get commissioning off of certain products.
On the other hand, a fee-only advisor is able only to adhere to fiduciary terms. This means they cannot take up commissions. They work best for affluent families who have a problem of keeping up with their finances.
Fee-based advisors are recommended for less wealthy clients who might not be able to afford fee only clients. Fee-based investments and advisors are becoming very popular nowadays. This is because of the flexibility they offer, and the source of a stable revenue collection.
- Demand for financial transparency.
Customers demand a transparent approach when it comes to their finances. Thus this means that financial institutions have to be informative with their goals, history and performance.
Research has it that 94% of customers would trust their finances to institutions which offer transparency. Consumers feel more comfortable making decisions and revealing all their financial information.
Moreover, internal transparency maintains communication between the management and employees. Thus fully creating a conducive working space.
A financial institution needs to embrace transparency. Here is how that can help.
- It is the only way to get positive reviews and ratings from customers.
- Have a positive social media visibility.
It’s also why a business that needs short term loans, needs to find out reliable lenders like UnsecuredFinanceAustralia – which could help them get their money in quick time.
- Automated production.
A lot of financial institutions are rushing to make automated technology as part of improving customer service and productivity. This offers a chance to outsize the gains of the institution.
Machines have already been put into place and take up 10%-25% of the work performed. This has resulted in high increased tasks. Some include software programs which automate repeated tasks.
Although there have been some challenges, the future of robotics and AI is maturing and developing.
