On Demand Loans Real Time Service: Essential User Feature by the Banks in Society 5

Abstract: Investing for a Sustainable Future is driving major client buying behaviors and long-term corporate strategies. We are currently at the transition between the 3rd Industrial Revolution (the computer / Internet based information industry), and the 4th Industrial Revolution (driven by digital transformation, AI, IoT, Blockchain), emerging into the 5th Industrial Revolution. This transition drives an unprecedented connection of business to purpose, democratizing technology for consumers with ease of use and integration of cyberspace with physical space In addition, Covid-19 has acted as a catalyst accelerating the virtual way people work, learn, buy, and how businesses interact with their consumers, partners, and one another, which will be forever changed. With much of life shifted online, such use of embedded finance products, transacting with e-commerce systems, etc. now demands a new level of data gathering, sharing, and management. This change in life drives the optimization of the entire social and organizational systems. In the Financial Services industry, “Buy Now, Pay Later” (BNPL) is one of the strongest trends, that redefines processes around digital payments, embedded lending, and e-commerce. With BNPL, retailers could minimize the risk of capital management during a period of huge economic uncertainty, worldwide lockdowns, and the temporary closure of non-essential physical stores. BNPL type process naturally evolves into digital frictionless user experience, replicated across channels, expanding into services such as event tickets and vacations (tailored to behavioral patterns and personalized shopping recommendations), offerings on interest-bearing financing and over-the-top payments with any merchant via their smartphone apps, QR codes, and virtual cards, making a range of goods and services more affordable.What would be the next moves? Winners in this market will be companies that combine strong consumer and merchant relationships into a composite cross-industry business process that translates to a robust value proposition and a potentially new set of business models. BNPL does not only produce monetary benefits. Because the providers have relationships with consumers and merchants, they generate powerful insights from the data exhaust, and can provide merchant partners with valuable data to understand :•Who their customers are and their target customer segments. •The types of products customers prefer. •Where customers shop. •Trading and micro-lendingIn the future, Data wallets will enable both individuals and businesses to control their participation in the new ecosystems based on their preferences, augmented by ecosystem-centric loyalty schemes, providing the foundation for new engagement models.Sustainability Linked Loans (SLLs) will support the achievement of the borrower’s environmental and social objectives, & United Nations ESG / sustainability metrics. People, Jobs, Economic Inclusion, and Sustainability will be at the heart of everybody. Banks need to turn BNPL into an opportunity, by applying technology and optimizing, automating, and even monetizing, through exponential technologies like BPA and AI. Banks should leverage their huge base of retail customers with a variety of credit products, and many established banking providers, that have merchant acquiring services. It is essential for businesses that intersect payments, lending, and e-commerce to formulate a BNPL strategy

Keywords: BNPL, data insights, human centric

DOI: 10.54941/ahfe1002254

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