ADVANTAGES AND DISADVANTAGES

The importance of technology in financial services is represented by the rise of the

financial technology (Fintech). New technology allows the creation of new financial services

to increase the efficiency of key banking functions.

By having the new technology as called as Fintech, one of the positive changes that

would be emerged is we are starting to tackle a range of other banking services. These include

providing alternatives in the payments space, offering loans and delivering financial planning

services, something that in the past was only available to high net worth individuals.

Fintech also provides opportunities to increase financial inclusion and provides

unbanked households and firms with access to loans and savings. Low‐income countries still

have a large part of the population lacking access to services that are widespread in high‐

income countries such as formal savings in financial institutions. Greater competition in the

banking sector, concentration risks, and greater security of remittances are added benefits

which mean reduced costs for participation in the formal economy and easier access to public

services based on improved government databases.

Besides, there are some concerns that raised by the Forth Industrial Revolution. First

thing is when the automated devices are expected to replace human in production, distribution,

and almost all areas. The number of staff would be rapidly decreased. Automated devices are

replacing bank’s production and job in the traditional financial industry are project to weaken

further. The task of this worker may be replaced by robots and more efficient automation

systems. Profit-based companies and organizations are sure love to buying the robots and

automation systems that can double the company's profits.

Besides, the Fourth Industrial Revolution (4IR) disadvantages is a challenge in

providing a new generation towards this Industry 4.0. This is due to the challenge of
implementing it involving issues such as the medium of instruction. In terms of

implementation, the top-down method should be changed to the bottom-up. The ability of

students to learn coding in programming is one of the problems. This is because the existing

teachers are not suitable to teach this subject because they do not have full knowledge about it.

While many graduates of computer science or IT (information technology) are required in the

current 4.0 Industry. Without young people today, the financial market and institution will not

grow. Therefore, exposure to new generation towards this Industry 4.0 is very important toward

the financial market and institution in the future.

Another concern is when an excessive drive for financial innovation may devitalize

investor protection. For instance, it is difficult to tell whether a customer solicited via a non-

face-to-face, online channel properly understands product risks or not, which may compromise

the duty to explain or suitability test.

Ultimately, the Forth Industrial Revolution may possibly devitalize financial stability.

For example, when multiple Artificial Intelligence (Al) services in the financial markets make

the same investment decision, herding or sophisticated forms of unfair trade practices may

occur. If financial services are concentrated in a certain platform for an example blockchain, it

is difficult to rule out the possibility that any unexpected hacking attack program or error will

inflict damage on a great number of financial customers.