Move over, Silicon Valley tech giants. Finance is drifting away from its “Wolf of Wall Street” reputation to become the next happy haven for tech talent.
In fact, software engineers are one of the most in-demand roles in all of finance, and 96% of financial institutions say software engineering is “critical” or “very important” to their company’s future, as these skilled professionals help enhance security, build consumer-friendly apps, and drive back-end process efficiencies.
Similarly, the financial sector employs 9% of all data analysts and data scientists—experts that specialize in financial risk modeling, financial product design, customer analytics, and fraud protection across banks, lending institutions, insurance companies, investment advisories, and credit bureaus.
Given that 78% of people prefer to bank online or in-app these days, UX designer has emerged as a fast-growing role within finance as companies expand their service to include more account features like budgeting tools, calculators, and financial literacy resources.
At the best finance companies, you’ll find all the resources you need to perform your job effectively, a welcoming environment of like-minded people who are willing to give a bit extra to get the job done, a healthy work/life balance, and a greater sense of purpose.
As someone once said, “Money makes the world go round but people make the world go forward.” Young people looking for a way to make a difference in global economies and improve standards of living at scale will find a sense of purpose in the finance sector.
What Makes Finance a “Tech” Industry?
It’s easy to forget that the Apple iPhone has only been around since 2007—meaning the finance-app-packed smartphone and accompanying fast money is a fairly recent development within the past two decades. Freed from the confines of plastic cards and trips to the bank, commerce is now part of everyday life, whether we’re getting on the subway using our digital wallets, checking mobile bank statements, or swapping E*trade investments on our lunch breaks. Every industry is a tech industry these days, but the seismic shift in finance is only just getting started.
Here are 10 sweeping tech trends that will define the future of finance:
1. Cloud-based Solutions
McKinsey estimates the world’s top 500 companies will pour more than $1 trillion into cloud technology by 2030. Now that legacy storage systems are out and the cloud’s in, banks are able to collect and analyze vast amounts of data, including consumer market trends, to improve offerings and operational efficiency. By lowering costs associated with storage, infrastructure, downtime, and security protocols, financial institutions can build mobile apps, digital wallets, and investment platforms.
2. Digital Experience Platforms
Though online banking dates back to 1997, the digital experience continues to evolve. When customers log in to their digital experience platforms, they’re greeted with personalized CD rates, pre-approved loan offers, credit card rewards, relevant educational seminars, and the ability to make transfers between different accounts with the click of a button. Financial institutions are joining third-party budgeting and money management apps to offer services to expanded networks.
3. Digital Payments
PayPal launched in 1998, kicking off a wave of fintech that made connections between consumers and merchants easier to manage than ever before. Newer players like Zelle, Stripe, Square, and Klarna continue to transform an industry estimated to be worth $2 trillion by 2025. The march toward a cashless future continues.
4. Natural Language Processing, Chatbots, and AI
Thanks to advances in Natural Language Processing (NLP), chatbots can now handle repetitive transaction processing, route calls more efficiently, and improve customer service outcomes. By some estimates, chatbots can save banks 30% on customer service costs, too. ChatGPT’s big splash this year has shown that there are still a few surprises left—and perhaps we’ve only really scratched the surface of what Artificial Intelligence (AI) can do: extract insights from unstructured data like customer reviews and social posts, model complex risk factors, process loan documents quicker, mitigate security breaches, and generate up to $1 trillion in additional revenue for the global banking industry.
5. Use of Predictive Modeling
As we aggregate massive amounts of data, our ability to comb through market crashes and ascensions will naturally improve. Investment firms are developing predictive models to execute trades based on complex algorithms and real-time market data. These models can help investors identify patterns in the market, foresee future shifts with greater accuracy, and optimize investment decisions.
6. Automated Fraud Mitigation
Biometrics like facial recognition software, fingerprint analysis, and retinal scans are beginning to replace older forms of identity verification. Surveillance for suspicious activity is increasingly automated and runs 24/7. In fact, financial institutions are able to compile information from multiple sources to often identify suspicious activity before fraud occurs—and should the system detect a breach, security protocols activate instantly to mitigate damage.
7. Blockchain Technology
As the breakthrough technology behind cryptocurrencies like Bitcoin, blockchain represents one of the biggest opportunities in the financial sector today. From instantaneous international money transfers, to self-executing contracts, to identity-verifying storage units—the potential applications are endless. The concept of Decentralized Finance (DeFi) looms in the distance as a potential market disruptor, as it’d allow virtually anyone with money to become an investor and potentially earn interest on their lending. In the near future, a financial institution will have to pivot to integrate DeFi into its ecosystems or become a DeFi platform operator itself. And through digitized tokens like stablecoins, banks have a tremendous opportunity to expand services to the 1.7 billion people around the world who are currently underserved by financial institutions.
8. Robotic process automation
Robotic process automation (RPA) is a common tool to run repetitive processes. In finance, think: generate reports, approve payments when certain conditions are met, consolidate document packages into a folder, or flag a high-risk loan application. While machine learning requires tons of data to effectively run its processes, RPA runs off a series of “if this / then that” rules written into a program. Financial service providers are among the highest adopters of RPA due to the ability to increase staff efficiency by 35-50% and reduce reliance on overseas processors by 75%. Everyone wins with the technology to offer customers greater convenience, expedite service, reduce error, and free staff from menial grunt work.
Well-established names like Betterment, Schwab, Vanguard, and Wealthfront have joined startups like Robinhood, Scalable Capital, and Nutmeg to provide automated financial advice. Robo-advisors have primarily helped investors adjust their portfolios, but now people can tap Status Money and Mint.com to determine how much to save and spend, or to Tally and Turbo Tax for strategies on how to minimize credit card debt or tax payments. The Brookings Institution predicts robo-advisors will continue to serve the market and level the playing field between wealthy and vulnerable households. While many robo-advisors serve distinct niches today, there’s much interest in building a more holistic robo-advisor capable of solving any personal finance conundrum.
10. Alternative Lending
Big tech is wading into the lending market—with Amazon, Facebook, and Google pursuing strategies to earn merchant loyalty through small business capital. Apple’s “buy now, pay later” installment loan is yet another example. Driven by deep need during financial crises, sophisticated data-driven credit models and the digital operating environment keeps costs low for service providers, opening the door for a new wave of alternate lenders to get involved.
Why Are Fintech Roles in High Demand?
So by now, you get the idea: technology is ubiquitous in finance. In fact, there’s a whole sub-industry centered around the marriage of finance and technology industries. The term “fintech” was coined in the seventies, but didn’t pick up traction until the 1990s once online banking took wing. Initially started to help business owners and consumers better manage their financial operations, today’s fintech spans across industries and sectors, from education and retail, to nonprofit organizations and wealth management.
In short, fintech applies to any innovation in how money is stored, managed, or exchanged—and the demand for talent runs deep.
Despite 182% tech job growth in the first quarter of 2022—including impressive gains in the US, UK, and Japan—vacancies are up 136% year-over-year. Common challenges like lack of gender diversity and excessive turnover for senior roles continue to dog staffing efforts. Even some of the largest countries that have traditionally produced much of the world’s tech talent, such as India, face difficulty finding skilled workers.
In response, not only have budgets increased, but organizations are re-evaluating the whole employee value proposition—schedule and location flexibility, retention bonuses, and employee experience—to attract the best and the brightest to their industry.
Industry players like JPMorgan Chase and Goldman Sachs have adopted less formal dress codes, flexible work hours, and higher salaries to appeal to the next crop of employees. Consumer banks have converted stuffy branch offices into hip cafes with complimentary money coaching geared toward Millennials.
What’s more, employers are starting to look beyond “brand name company experience” to consideration of candidates with strong technical and interpersonal skills and consumer product experience.
Imagine the Possibilities with a Tech Role in Finance
You’ll find many of the same skills cross over with a career transition from finance to tech. Attention to detail, critical thinking, analysis, ethics, and communication are just a few of the many skills you’ll flex in either industry setting. Given the deep talent shortage and growing importance of tech in finance, employers are relaxing old prerequisites like bachelor’s or master’s degrees and inviting sharp talent from boot camp programs to join diverse teams.
It’s never too late to find work you love, especially in one of the following roles:
- Software engineer: Software engineers are among the 10 most sought-after roles in finance, according to CIO Magazine. In fact, 96% of financial service companies surveyed say software engineering is “critical” or “very important” to their organization’s future. By learning skills like Java, Python, React, Microsoft Azure, and NoSQL, you’ll write code, automate processes, develop applications, and facilitate consumer-facing digital services. Companies hiring software engineers run the gamut from Capital One, Wells Fargo, and Chase, to Barclays, Fidelity, and Square.
- Data analysts: Finance is also among the top industries hiring data analysts. While a data scientist is tasked with determining causal relationships between pieces of data, analysts focus on determining what’s in the data and how to clean and structure it in a usable format. You’ll communicate with teams to find out what to obtain from the data, create dashboards using tools like Tableau to find the information you need, and report statistical analysis that helps identify trends and solve problems. Though we live in uncertain times, data analytics is the lighthouse in the darkness, illuminating the path to better financial forecasting and management.
- Data scientists: Data scientists take data analysis one step further by using data and code to solve challenges related to algorithmic trading, consumer experience initiatives, fraud protection, risk management, and stock market predictions. You’ll learn about NLP, machine learning, and AI as part of your coursework. Financial service employers hiring data analysts include companies like Barclays, Bloomberg, Experian, HSBC, and Vanguard. Presently, only 11% of the world’s data scientists work in finance, so there’s definitely high demand for your skills and room for growth.
- UX Designers: UX designers combine creative vision and communication skills with technical abilities like data analysis and critical thinking to produce user-friendly websites and applications. Manan Shah got a degree in finance and began his career as an asset management auditor with Lehman Brothers and then Neuberger Berman. After completing a General Assembly bootcamp, he landed a rewarding career as UX designer at JPMorgan Chase. For Shah, UX design checked all the boxes for him: “Am I the kind of person who asks how things could be made better? Do I want a seat at the table to advocate for the person actually using the product? Do I like to find new ways to do things, like hacks?” Now he works with interesting, open-minded people who are helping users see their finances in a holistic way, which he finds very rewarding. UX has a niche for everyone, Shah says, whether you gravitate toward navigational architecture, content editing, back-end frameworks, or the arts.
Use GA as your tech skill stepping stone into finance
Whether you worked in banking or you’ve just always had an interest in money management, General Assembly bootcamps offer a straightforward, practical path into the field of finance with curriculum developed by industry experts and tailored to meet the needs of top employers. We’ve trained over 60,000 learners from all backgrounds in the most in-demand tech skills, pairing them with mentors and internships and providing extensive job search support to ensure their long-term success.
Wondering if a finance career might be love at first byte? Take our Tech Industries “Meet Your Match” Quiz to find out!