Introduction
The global landscape of the Financial Technology (FinTech) industry looks drastically different from what it used to be a few years ago. This is because of the continuously changing trends through the integration of modern technology, innovative initiatives, and creativity.
Fast forward to a few years from now, and the industry will have changed again. Taking preemptive measures to stay ahead of the curve by understanding the top financial services trends is one of the practical ways to keep up with the ever-evolving FinTech industry.
2024 is already here, and it is time to gear ourselves up to embrace the changes that are in store for the FinTech industry. This article will cover the top 5 FinTech trends one must watch out for in 2024. Read along and be a part of the future of FinTech.
Why FinTech Trends Are Important
A press release from Boston Consulting Group (BCG) New York and QED Investors reported that the revenue of the FinTech industry is projected to grow sixfold from USD 245 billion in 2023 to USD 1.5 trillion in 2030.
Furthermore, the press release highlighted that Asia-Pacific is set to outperform the USA and become the world’s largest FinTech market by 2030. It is worth noting that the FinTech sector, which holds a 2% share in the global financial services revenue of USD 12.5 trillion, is estimated to grow up to 7% by 2030.
These are impressively staggering figures for sure, but the only way businesses and stakeholders in the FinTech industry can leverage and profit from the projected numbers is by knowing the current and future financial services trends of the industry and by knowing how to integrate them readily.
FinTech Trends in 2024 that Can Make a Difference
In the recent past, non-financial platforms have been integrating financial services, and this is likely to grow at a phenomenal rate in the coming years, starting from 2024. The rise of embedded finance in 2024 will be characterized by eCommerce sites that provide loans, social media platforms that include payment features, and payment gateway platforms like PayPal, Stripe, and Square that integrate into regular payment processes.
Future developments in embedded finance are expected to be fueled by generative AI and data analytics, which will result in specialized services and financial products that are suited to particular industries.
Therefore, taking into account the complexities and expenses of creating internal financial services, strategic alliances with top FinTech companies such as SignDesk appear to be the optimal strategy.
- Artificial Intelligence and Machine Learning
It’s amazing to see the opportunities artificial intelligence (AI) and machine learning (ML) bring to the financial industry. This technology has advanced significantly in a short span of time. Customized investment portfolios, improved efficiency, and improved risk management are all made possible through their integration.
By 2024, AI and ML are some of the new FinTech trends anticipated to help the finance sector even more in identifying fraud and risk. AI-enhanced chatbots have become indispensable for finance apps, offering customized advice and real-time support.
- Decentralized Finance and Blockchain
Financial transaction management is made possible by Decentralized Finance (DeFi), which eliminates the need for external intermediaries. By combining cryptocurrency and blockchain technology, customers can access services—such as lending and investing—without the need for conventional middlemen like banks or other financial organizations. DeFi, as one of the new FinTech trends, has been advocating for the creation of an international P2P (peer-to-peer) financial network in order to decentralize the world’s financial markets for a few years now.
According to Grand View Research, decentralized finance was valued at 13.61 billion USD in 2022 and is expected to increase tremendously over the next few years. By 2030, analysts predict that revenue growth will reach 231.19 billion USD.
Driven by legislative actions, open banking is expanding internationally and helping both new players and established financial institutions. Through APIs (application programming interfaces), open banking makes it easier for banks and third-party providers to share financial information.
An API, for instance, can let customers access several bank accounts from within a single app. This type of link promotes consumer transparency and gives financial managers the ability to oversee operations without wasting time on labor-intensive manual payment procedures.
Consumer need for quicker, more convenient, and more secure payment methods drives innovation in open banking. It is anticipated that in 2024, open banking will play a bigger role in facilitating unique payment experiences, but with more regulation to safeguard customer privacy and promote fair competition.
- Gamification in B2B FinTech
Utilizing new technology by users is crucial. Financial software would stagnate and be unable to generate the necessary subscription fees to remain viable without their acceptance.
Financial chores become more participatory and pleasurable through the introduction of game-like features in fintech services, a practice known as gamification. Producing material tailored to individual users is frequently involved (think of reward systems for finishing minigames, scratch cards with offers, etc.)
Gamification is undoubtedly becoming more popular not just in the finance sector but also in commercial and retail domains since it increases user experience and engagement, thus making it one of the most important new Fintech trends to watch out for.
Conclusion
By combining technology and finance, fintech is expected to shape a new landscape in 2024 that is characterized by disruption, innovation, and accessibility. With these revolutionary developments redefining consumer views and financial interactions, the sector is moving toward a future that is more digitally integrated and easily accessible.
However, it’s crucial to know which FinTech trends have the greatest potential to affect your company before embracing them all. Overcommitting can lead to financial waste and uncertainty. Consider each trend’s potential benefits for your company and develop a plan of action accordingly.
If you need some guidance on which of these FinTech trends work best for your business, then SignDesk is the right business partner. We will not only analyze and define the financial services trends that work for your company but also ensure seamless integration.