How Has Technology Changed the
Way We Manage Our Finances?
Our habits surrounding finances have been forever changed by technology. Advancements in financial technology (fintech) and new products mean that we now conduct our finances in an entirely different way to 15-20 years ago.
We’ve compiled a quick rundown of some key lifestyle areas which have been changed through technology and their financial implications.
Our Banking Habits
Previously, pretty much all serious banking matters – opening an account, applying for a loan, etc. – needed to be conducted in person. You’d need to visit a branch and discuss terms face-to-face.
Comparing that to now, the online capabilities within banking have come on leaps and bounds. Online banking has allowed us to take care of many major financial processes from the comfort of our home.
Some newer banking establishments have even done away with their high street presence. The control rests a lot more with the customer than ever before, since their mobile app has effectively replaced the physical bank.
How We Shop
As eCommerce platforms have become essential for businesses within the modern retail landscape, the way we shop is a lot more varied to merge the physical and digital channels.
Rather than just popping into a bricks-and-mortar shops, we research products online and might even organise a click-and-collect service. There’s also the option to simply stay at home and have it delivered instead.
While people still use their credit and debit cards linked to traditional banks, prepaid debit cards have entered as a way for people to manage their spending more closely. You can top up a card with a certain amount from an app and cap when you’re spending when shopping.
How We Pay Our Bills
While bills have historically been paid using a variety of methods – cash, cheque, bank transfer – people have moved towards paying via direct debit. Online banking makes it considerably easier to set these up and removes the risk of missing a payment.
People don’t even need to have their direct debits linked to a current account. The prepaid cards or mobile wallets which people have can be used as the primary source of funds. This can make managing outgoings easier as you can put your paycheck into different pots.
How We Invest
Stocks and shares are no longer fenced off as they have been traditionally. While stocks and shares ISAs have been around for a while and you could invest money via a third party, there are now trading apps you can use.
These allow you to take control of your investments and play the stock market in order to grow your investment. While this can require a broad knowledge and deep understanding of the market, those who learn how to trade successfully are rewarded.
Forex apps in the hands of the many have seen recent headlines as traditional firms have even been outmaneuvered by the public using these apps.
Technological advancements in every industry are showing no signs of slowing down. Our relationship with our finances has been forever altered by technology, with things like cryptocurrency waiting in the wings to become mainstream for years. Importantly, these advancements are designed to be beneficial for the consumer and give them a greater degree of control over their finances.