While blockchain has been around for more than a decade, research by order-to-cash specialist Onguard shows almost half (48%) of 1,000 finance professionals surveyed as part of the 2019 Fintech Barometer lack awareness of the technology and the benefits it offers. Of this percentage, 19% say they are unaware of its uses within finance and a surprising 29% of respondents admit they have no idea what blockchain is. This is despite the fact that blockchain technology is being widely slated to shake up the financial world in 2020. Still, before this can happen, it’s clear that more needs to be done to raise the profile of this emerging technology.
Fortunately, despite a large proportion of financial professionals being unfamiliar with this technology, 29% of those surveyed were found to be either already using or planning to use blockchain, a figure that rises to 57% among CFOs. With the CFO playing a major role in the adoption of new financial technologies within their organisation, this is positive news. However, it also serves to highlight that CFOs aren’t currently sharing their knowledge regarding the importance of blockchain with the rest of their organisation.
This lack of communication regarding blockchain is demonstrated by the fact that more than half (52%) of finance professionals claimed that it was never mentioned during meetings. Conversely, when CFOs were asked the same question, 45% stated they talk about blockchain at least once a week, and 17% discuss it every day. Consequently, CFOs must improve their levels of communication regarding emerging technologies with those less senior to increase awareness and prepare for when these new tools become mainstream.
As a significant number of finance professionals lack awareness of blockchain, it’s perhaps unsurprising that only 10% see it as a technology likely to disrupt the industry. In comparison, 38% of finance professionals expect the cloud to have the biggest impact on their sector, followed by artificial intelligence (AI) (32%). Despite the exact uses of blockchain not yet being defined, the level of activity using this form of technology is only going to increase. After all, businesses are already benefitting from enhanced data security and the ability to automate admin processes. The introduction of these technologies will have a largely positive impact on the finance sector, but it is causing some concern among finance professionals with more than a third (39%) believing blockchain and AI will have a major impact on employment.
Whereas in 2018 technologies such as blockchain and AI were often discredited and labelled as ‘hype’, adoption of AI has increased during the past year. Now, this technology is being widely used within the world of finance to automate a range of often time-consuming and menial tasks, such as invoicing and segmenting customers. This is helping finance teams to optimise their order-to-cash process and is significantly improving their ability to predict whether and when their customers will pay.
In the coming year, blockchain’s potential is likely to be realised and its adoption will increase as businesses see it is a viable solution for financial services. Its benefits include making the origin of payments transparent and consequently removing the risk of fraud. However, before blockchain can become the norm, more awareness needs to be raised as to those benefits. So, with over half of CFOs already preparing for such initiatives, 2020 could be the year of the blockchain revolution.