Available to download is a free sample file of the Global Fintech Market report PDF. The field of financial technology is undergoing tremendous change, and there are a great deal of fascinating trends and breakthroughs to keep an eye on. Another significant development in the field of financial technology is the blockchain protocol.
- In 2022, be prepared to take the adage “there’s an app for that” to the next level.
- Allows users or organisations to set up “flight-delay” insurance policies to automatically payout if flights get delayed by two hours or more, removing the hassle of filing a claim manually after something happens.
- All the FinTech trends we have discussed were emerged due to the consumers’ needs.
- Outside the world of finance, many technology firms owe their success to the right business models, coupled with the right processes and operations as well as targeting the right pain points that their customers face.
- On the customer-facing side, fintechs must also strive to provide a human touch for service interactions.
However, it is still progressing so that the illiterate section of the society could access safe financial services as well. As financial transactions become increasingly digitized, cybersecurity has become a major concern for the fintech industry. Companies are investing in advanced security measures to protect against data breaches and cyber attacks. Innovative solutions such as blockchain can aid companies in keeping data secure and almost unhackable. Blockchain technology enables ultra-secure payments and transactions without any intermediaries, which significantly reduces costs. Based on the statistics, blockchain will be responsible for storing 10% of global GDP by 2025.
Simply put, embedded finance refers to the integration of financial tools or services within the offerings of nonfinancial institutions. It covers financial services such as banking, credit and investment and has extended its reach to adjacent areas like payment processing and insurance. Artificial intelligence and automation are driving the transformation of financial services.
As the Fintech industry continues to revolutionise the digital banking landscape, a recent report by Invest India revealed that India’s Fintech adoption rate rose to 87%, exceeding the average global rate. With the Indian government launching initiatives such as Digital India with financial inclusion as its primary objective, the fintech industry is expected to grow at an unpredictably rapid rate. The adoption of innovative technologies by fintech companies to prevent cybercrime and financial fraud is providing further impetus to the market growth. Moreover, the introduction of personalised artificial intelligence , which is more objective and reliable than other investors, is also expected to bolster the market growth.
What are the 8 Latest Trends in FinTech?
Below is an overview of fintech today showing how diverse and full of opportunities the sector is. The overview can become a source of inspiration for people thinking about investing in fintech or starting a business related to it. The popularity of digital marketplaces for various types of products is increasing day by day. The rapid pace of change in society today—be it social, technological, or both—has created what appears to be an entrepreneur’s paradise, as demonstrated by the proliferation of fintech startups.
These worries, on the other hand, are expected to become less of an issue if neobanks continue to expand their customer bases and solidify their positions in the financial industry as a whole. However, with so much going on, it can be tough to keep up with all the latest trends and innovations. Victoria has over 15 years of experience in IT, keeping track of the current and future trends in the sphere, sharing expert advice and relevant industry experience. New apps allow us to keep track of our spending, plan the budget, manage savings, and do many more things with our money. Treat them as your personal assistants who are dealing with all the necessary but time-consuming money-related tasks.
Top 10 Biggest US Banks by Assets in 2023
Over the years, the fintech industry has evolved in significant ways, leading to the transformation of companies into customer-centric businesses. Thus, finding a place among a plethora of companies ranging from startups to tech companies to established firms all over the world is not easy. Artificial intelligence and Machine learning are used for various purposes in FinTech solutions. The increasing internet penetration and the rising ownership of smartphones around the globe, along with the rising adoption of cashless currency, have revolutionised the payment and money transfer segment. Fintech has had an ambitious effect on the financial and lending markets since the beginning of the 2020s. Given fintech’s growing influence on financials, 82% of financial companies plan to increase their fintech partnerships in the upcoming years.
This is because young or online businesses are often deemed “high risk” by traditional bank lenders and denied access to credit. Among all forms of embedded finance, buy now pay later is a notably growing sector. This payment option enables purchasers to buy products now and pay for them later, usually by splitting the purchase sum into multiple installments to be settled over time.
Every trend plays an integral role in fostering the development of the fintech sector while considerably improving the quality of life of consumers and making society more inclusive and progressive. Investors are now more interested in the feasibility of the business models of various fintechs than just their technological prowess. Outside the world of finance, many technology firms owe their success to the right business models, coupled with the right processes and operations as well as targeting the right pain points that their customers face. We already see rapid change in who accesses financial services and how they do it. The finance-oriented application provides advanced yet innovative solutions to improve financial services.
But ensuring adequate financial services to unbanked and underbanked populations has the very real potential to have a positive impact on global poverty. Financial technology has initiated solutions like mobile money and agency banking to improve financial inclusion in many regions of the world. In the year 2021, FinTech apps will be able to provide all types of banking services to the illiterate among us. As more people will opt for digital banking, there will be a significant decline in paper-based banking. As of 2020, people have become comfortable in accessing financial services through online apps and messaging. Even if you don’t work in the fintech industry, trends pertinent to this sector could still have a profound impact on your business.
Planning in Uncertain Times
The complexities of the Asian regulatory environment can be a major barrier for FinTech companies operating in the region. Regulatory compliance obligations differ from country to country, creating a complex landscape that can be daunting for foreign companies. These differences can make it difficult to conduct Asia FinTech market research successfully.
Finally, we are watching AI and how it improves security for payment technologies. AI and machine learning software are able to detect fraud instantly and automatically, making mobile payments even fintech trends for digital payments more secure. I think our strength as a company is that we know exactly what we can bring to the table; a platform that bridges the gap between ‘traditional’ financial operations and crypto.
Can AI be the future of Financial Crime?
The landscape of fintech is constantly changing – what worked five years ago may not be as relevant today as newer technologies come into play. This means that businesses need to stay up-to-date on the latest trends and advancements to ensure their solution remains competitive in an ever-changing environment. In addition, privacy and regulatory requirements are often complex and difficult to comply with; any breach or non-compliance could result in hefty fines or other penalties.
Costly services of financial planners are now becoming more affordable with the help of these digital platforms. This market also has many opportunities for attracting new clients and enlarging the market share. It is because the barrier for entry is way lower with robo-advisors ($5,000) compared to human advisors ($100,000 to $200,000).
Companies like Earnin, Dave and SoLo Funds are proving the effectiveness of the donation-based revenue by operating it at scale. But it’s important to ensure that the donations are completely optional and do not provide donating users special access to services or a “pay to play” situation. Traditional financial institutions saw an opportunity by providing financial data to these banks. Banks now share more financial data with platforms, making banking more user-friendly. Startups have a little regulatory leeway, but there’s only so far they can go solo with their own platforms.
Top FinTech Trends to Consider in 2021
This model forces every bank to release data securely so that authorized information can be shared easily on multiple platforms. As of 2021, Neobanking is widely available and, companies can work either get their license or work with a brick-and-mortar bank to offer their financial services. With the help of secure finance-oriented applications, users won’t waste another second on routine tasks.
Machine Learning and Artificial Intelligence
We asked PDP participants to share their most important takeaways from their PDP experience. Implementation and integration of new technologies is slow and progress can be unsteady. This is especially true if you are trying to integrate with legacy systems. To stand out in the noise today, a successful innovator will increasingly require a clear and demonstrable path to monetization, without relying on sleek interfaces or showy gimmicks. While the greatest opportunities may lie overseas, this is not just an issue for those interested in a global reach.
On the customer-facing side, fintechs must also strive to provide a human touch for service interactions. And thanks to this trend, Gen Z’s and the unbanked now have an easy way to access payment processing services from their homes. “Let’s talk more about blockchain technology, and its enablement of peer-to-peer transactions,” says Santhana, naming blockchain as a fintech trend. Both the concept and practice of alternative finance have been around for some time, but they hadn’t risen to popularity until the recent e-commerce and startup boom.
Due to the intuitiveness of the solution, it has received immense interest amongst buyers. For example, a study shows that 55.8% of consumers have used a buy now pay later service in 2021, up from 37.65% in 2020 – an increase of over 50% in a single year. Also, the percentage of Gen Z’s using autonomous BNPL has grown 6x from 6% in 2019 to 36% in 2021. Every company receiving, transferring, and receiving payments must adhere to this regulation. Financial Crimes Enforcement Network This regulatory body ensures that all US-based FinTech follow anti-money laundering regulations. A major reason for this growth is that blockchain-verified data is secure.