The fintech industry has seen a huge surge recently, with worldwide revenue estimated to reach $324 billion by 2026.
It has grown into an international powerhouse, combining the best of traditional financial services with cutting-edge technology to build innovative products and services that have revolutionized the way we do business.
Fintech start-ups are now seizing this opportunity with advancements in payment systems, banking, insurance, and more for growth and increased revenue.
Here are the eight new trends in fintech that you need to know about to stay ahead of the curve.
So, without further ado, let’s discuss the latest Fintech trends of 2022 and beyond.
Find Out The Top Fintech Trends To Look Out for 2022 and Beyond
1. The Rise of Embedded Finance Solutions
Fintech start-ups are on the rise, and one of the hottest areas in fintech right now is embedded finance.
Embedded finance solutions are those that are built into existing platforms and apps, making it easier and more convenient for users to access financial services.
More and more companies are looking to embed financial services into their existing products and platforms.
This makes it quick and convenient for customers to access financial services and allows companies to tap into new revenue streams.
This significant trend is driven by the increasing demand for financial inclusion and the need for businesses to provide more seamless customer experiences.
As fintech start-ups continue to innovate and expand their solutions, we’re seeing a lot of growth in several specific areas within embedded finance solutions, including:
👉 Financial transactions: Companies like Square Cash and Venmo allow people to pay friends or family members through their smartphones without needing cash or credit cards.
👉 Data analytics: Newer fintech companies are building real-time risk detection software into everything from card processing networks to car insurance policies. It enables them to offer new insurance plans based on drivers’ behaviors and traditional risk factors.
👉 P2P lending: Traditional banks have been slow in adopting P2P lending strategies, so fintech start-ups have jumped in with innovations like peer lending platforms and online investment groups for funding small business loans.
2. The Rise Of Digital-Only Banks
In the past few years, several digital-only banks have launched and gained traction with consumers. These banks are often lauded for their sleek design, user-friendly interfaces, and competitive fees.
And it’s no wonder they’re becoming more popular— traditional banks simply can’t keep up with the pace of innovation.
Digital-only banks provide all the same services as traditional banks but without brick-and-mortar locations. This makes them more convenient and often more affordable.
Also, customers don’t have to stand in queues, do the paperwork, or visit the branch physically. These are some of the crucial reasons why consumers prefer digital-only banks instead of traditional banks.
3. Adoption of Robotic Process Automation
Robotic process automation (RPA) is one of the hottest trends in fintech as RPA can automate repetitive, rule-based tasks usually performed by humans. This can easily free up employees to focus on more strategic work and help reduce errors and improve compliance.
RPA is being adopted by start-ups in various industries, from banking to insurance to healthcare. In addition to reducing costs, companies that use this technology often report improved customer service levels and increased employee satisfaction.
RPA offers an attractive, low-risk way to dip your toes into new technologies like artificial intelligence (AI). Companies implementing RPA can easily integrate AI technology into their workflow and upgrade from RPA to more advanced AI solutions.
Also, you don’t need to be a large, multinational corporation to benefit from RPA. A growing number of smaller fintech companies are taking advantage of RPA.
For example, KlickEx Group leverages RPA tools from Blue Prism to speed up manual processes around foreign exchange and international payments.
The company has since launched KlickPay, which enables individuals and businesses to make faster cross-border payments through digital wallets.
4. Super Apps Race Will Intensify
Recently, we’ve seen a proliferation of super apps like WeChat and Alipay. These are all-in-one platforms that offer a wide range of services, from messaging and payments to transportation and e-commerce.
The competition in this space will only intensify in the coming years as more and more companies jostle for positions.
👉 Payment start-ups like Venmo and Square Cash have begun to go head-to-head with chat app giants like Facebook Messenger.
👉 Uber’s ambitions have led it into direct competition with other on-demand service providers like TaskRabbit and DoorDash.
👉 Uber also introduced its platform for retailers to sell goods directly from their stores using the Uber app.
👉 India’s Paytm has partnered with Starbucks for customers to order coffee and food from within the app.
5. Adoption of Blockchain Technology
In recent years, there has been a growing interest in blockchain technology and its potential to revolutionize various industries. The fintech industry is no exception, with start-ups exploring how they can use blockchain to create more efficient and secure financial systems.
One of the most promising applications of blockchain in fintech is in the area of payments. By using blockchain, start-ups can create payment systems that are faster, cheaper, and more secure than traditional systems.
The other promising area for blockchain in fintech is in the area of lending. Blockchain will allow lenders to process loans more quickly and securely.
For example, when a borrower applies for a loan, the lender checks their credit score on an immutable ledger. If they get approved, then funds will automatically be transferred to their account without any paper checks or signatures being necessary.
Blockchain also promises increased security from hackers since the information stored on it cannot be altered once it’s written onto the ledger.
6. Biometric Security Systems
One of the latest trends in fintech is biometric security systems. Biometric security systems use physical or behavioral characteristics to authenticate users, and they’re becoming increasingly popular due to their high level of security.
These systems provide an extra security layer, making it harder for hackers to steal personal information. They’re also becoming increasingly common on PCs and laptops due to their higher level of security.
Biometric security systems can identify someone based on a fingerprint scan, an iris scan, a voiceprint analysis, or an image of their face. They’re also getting cheaper to manufacture thanks to advances in technology.
You can hire dedicated developers to build an efficient application for your Fintech business.
Moreover, there are three primary types of biometric security systems: fingerprint scanning, face recognition, and voice recognition.
Every time you unlock your device using one of these methods, it provides a higher level of protection than if you used a PIN or password.
That’s because not only can someone obtain your passcode, but they could potentially steal your phone and use it to access all of your sensitive information and personal details.
But with biometrics, you never have to worry about that. It automatically encrypts data once it recognizes your unique ID, so even if someone could hack into your device, they wouldn’t be able to access any of the information without knowing your ID first.
7. Rise of BNPL (Buy Now Pay Later)
BNPL is one of the emerging fintech trends of fintech that has garnered the attention of several start-ups and entrepreneurs. BNPL (Buy Now Pay Later) is a unique payment option for consumers that allow them to buy products and pay the bills later.
Consumers get this facility at ecommerce checkout and the point of sale. It is mostly used and loved by consumers of different geo-locations, which has resulted in an increased number of BNPL users.
A recent study by Juniper Research found that the number of BNPL users will increase to 900 million by 2027, up from 360 million in 2022.
This way, BNPL has huge potential to attract new customers and take your start-up business to the next level.
8. Mobile Payment Innovations
People are now less reliant on cash and are eager to pay more quickly for their services and products. That’s why we have recently seen the emergence of non-bank players competing with traditional banks.
Non-bank players provide value-added services in various fields, including retailers, start-ups, telecommunications, etc.
For instance, we have already seen Apple introducing the Apple Pay system to enable users to pay quickly for goods and services. Hence, we can expect more from mobile payment technology to pay bills more easily and conveniently.
As we move further in 2022, we will see above mentioned Fintech trends to make financial services better and secure.
The trends will improve the financial inclusions, enhance transparency, and faster transaction processing, ultimately leading to the rise of the Fintech industry.
If you are also eying to get the maximum output, you need to have an efficient Fintech solution to grow your business.
You can contact Quytech, a premier-class fintech app development company that has successfully completed and delivered various Fintech solutions to its clients all over the world.