The financial industry is witnessing rapid developments in global FinTech market trends that can significantly impact various aspects. Globally, more than 26,000 FinTech businesses are operational, employing nearly 500,000 people. At least one unconventional provider’s money service is used by a third of all banking customers. To help you stay updated on the latest innovation in FinTech driving the FinTech revolution, we have compiled a list of these transformative technologies.
Main FinTech Trends 2024
#1 Embedded Finance
Embedded finance is revolutionizing traditional banking by seamlessly integrating financial services into various non-financial apps and platforms. This trend enables individuals to access financial services effortlessly as part of their daily routines. For instance, when shopping online, consumers can apply for point-of-sale loans or access personalized savings and investment options directly from e-commerce platforms. Ride-sharing apps offer insurance coverage options customized for each individual trip, and even social media platforms introduce in-app banking and payment services.
#2 Neobanking
The pandemic has shown us the potential of home-based activities, and the financial industry has also embraced this idea seriously. The growth of neobanks has been fueled by FinTech advancements. Neobanks resemble traditional banks but without physical branches.
Therefore, neobanks possess all the features of a traditional bank branch. Instead of following the traditional bank branch model, many emerging FinTech businesses are exclusively focused on net banking. This approach benefits both companies and customers through cost reduction and easy accessibility.
According to Statista, the number of individuals with at least one neobank account is projected to reach a peak of 39.1 million in 2025, up from 20 million in 2021. In a time when remote work was crucial for many businesses, the advantages of instant transfers, swift registration, and full online banking access with IBAN and ACH accounts are significant.
#3 Blockchain
In 2024, blockchain technology, which forms the foundation of cryptocurrencies, embarks on an unstoppable journey of evolution. In 2024, stablecoins take center stage and reach new heights. These digital assets remain firmly tied to stable reserves like fiat currencies or commodities. Stablecoins combine the strengths of other cryptocurrencies – offering speed, security, and borderless transactions.
If you think about it this way, the phenomenon of stablecoins is simplicity, accessibility, and lack of restrictions. Physical money, like landline faxes, is gradually becoming obsolete. Just as stablecoins have become a more convenient analog of physical money, online fax is replacing the landline fax. If interested, you can find out more using this link. Now one fax app can completely replace the landline fax and make it easier to send faxes between all people. Moreover, you can both send documents to landline fax and receive them.
#4 Robo-Advisors
Artificial intelligence advancements have opened new doors for investors to benefit from computerized financial guidance. Robo-advisors and personal financial managers utilize AI concepts to assist investors in making optimal financial decisions.
Based on advanced AI data analysis algorithms, Robo-advisers can:
- Analyze massive volumes of data,
- Adapt to a changing environment faster than human advisors,
- Present investors with the most suitable investment options to achieve their objectives.
Rookie investors, who lack access to traditional counseling due to reduced entrance barriers and the availability of alternative investment instruments, particularly favor these AI-powered tools. These tools enable almost anyone to generate profits, even with limited funds.
#5 Gamification
By integrating gamification principles, the financial industry in 2024 will witness a significant transformation. According to Mordor Intelligence, projections suggest a staggering 350% expansion of the gamification market by 2026, compared to 2020 data. Gamification emerges as a vital strategy beyond traditional banking to engage users, promote financial literacy, and encourage responsible financial behaviors.
#6 Smart Contract
The use of smart contracts in finance enables automation without relying on third parties. This means that buyers and sellers can conveniently enter into legal agreements without the need for traditional banking institutions.
The future of smart contracts could see standardization through DeFi fintech applications. Imagine needing a mortgage – instead of going through the traditional process of applying for a loan from a bank and waiting for approval, a smart contract could provide you with the necessary funds in just minutes or even less.
#7 Voice-Enabled Payments
Older individuals used to believe that ideas of future FinTech companies only existed in literature from the 1960s when they watched television shows like Star Trek. Now, voice-enabled cell phones have become a reality.
People now have the convenience of hearing their current balance while making payments or money transfers using voice-enabled FinTech market trends and digital assistants like Siri, Google Assistant, or Amazon Alexa on their mobile devices.
#8 BNPL
By 2026, the global market is projected to witness a surge in the utilization of the BNPL option, reaching a staggering value of $576 billion, a significant leap from its 2021 worth of $120 billion.
Paying heed to the flourishing BNPL trend is crucial for businesses operating in the payment industry, be it B2C or B2B. BNPL providers place utmost importance on user experience. They invest in optimizing app processes, guaranteeing transparent terms and conditions, and providing personalized recommendations tailored to individual preferences and financial behaviors.
Conclusion
Fintech experienced a turbulent year in 2023, and experts anticipate potential challenges ahead in 2024. While optimism remains for market recovery, it is prudent to prepare for a prolonged period of reduced investments. The key to success lies in wise decision-making and capitalizing on emerging global fintech trends.
