The fintech industry has undergone a remarkable transformation over the past decade.
Evolving from simple online banking services to a broad ecosystem encompassing digital banking innovations, blockchain technology, artificial intelligence, and beyond.
This rapid evolution has reshaped how we avail financial services by encouraging innovation, competition, and accessibility in a sector once dominated by traditional financial institutions.
As we stand on the cusp of 2024, it becomes increasingly important to stay abreast of various key fintech trends shaping the future of finance.
These trends offer a glimpse into a future where finance is more inclusive, efficient, and tailored to the needs of the modern consumer.
In this article, we will explore 20 key fintech trends for 2024, each highlighting a unique aspect of the industry’s ongoing evolution and its impact on consumers, businesses, and the global economy at large.
20 Emerging FinTech Trends in 2024
1. AI and Machine Learning Enhancements
The fintech sector continues to leverage AI and machine learning to revolutionize personalized financial services and optimize financial service operations for more efficiency.
An AI in FinTech report by N-iX found that the implementation of AI in the form of chatbots in the fintech sector led to total savings of more than $7.3 billion in 2023.
2. Blockchain and Cryptocurrency Innovations
Blockchain technology and cryptocurrencies are expanding well beyond their origins, with smart contracts becoming increasingly vital in automating and securing digital transactions.
Blockchain’s popularity has made fintech blockchain solutions a viable option for investment all around the world.
Statista’s report on Global Spending on Blockchain Solutions predicts global investments to exceed $19 billion in 2024.
Seeing how blockchain in fintech is relatively new, players in the fintech market are also investing in blockchain videos to help their customers understand things better.
3. RegTech for Compliance Automation
The adoption of Regulatory Technology (RegTech) for compliance automation has surged, as firms seek to efficiently manage their regulatory obligations.
KPMG’s Pulse of Fintech Survey found that while RegTech investment broke records in 2022 by surpassing total funding of $21 billion, it significantly dropped in 2023 to just $2.6 billion.
But with fintech innovations and adoption on the rise, RegTech’s global investment trend is expected to make a comeback in 2024 and in the years to come.
4. Neobanks and Challenger Banks
The growth of online-only neobanks and challenger banks has continued to disrupt the traditional banking landscape and convince people to switch from traditional banking to an all-online banking system.
For instance, neobanks and challenger banks are estimated to gain almost 53.7 million users from the US alone by 2025 according to a Challengers and Neobanks survey by N-iX.
The major challenge for neobanks is gaining the trust of new customers looking for an alternative to traditional banking.
This has led to a massive increase in investment in financial explainer videos that break down the concept of neobanks in simpler terms.
5. Insurtech Innovations
Digital insurance platforms are transforming the insurance industry by offering personalized policies and streamlined claim processes.
When it comes to implementing Insurance Technologies (InsurTech), digital insurance platforms have become a more convenient option than availing traditional insurance.
The adoption of InsurTech is also evident with its current growth in market size, with Zipdo’s Technology in Insurance Statistics estimating the InsurTech market to reach $10.14 billion.
6. Robotic Process Automation (RPA)
RPA is revolutionizing financial operations by automating routine tasks, from data entry to transaction processing.
A 2024 Robotic Process Automation Usage Statistics from DashDevs found that 24% of banking and financial service providers rely on RPA to increase the efficiency of providing services to their customers.
7. Peer-to-Peer (P2P) Lending Growth
P2P lending platforms are significantly impacting personal and small business financing by providing an alternative to traditional bank loans.
A P2P Lending Market Survey from Technavio found that P2P Lending saw a 27.83& YoY growth in 2023 and is estimated to show an upward trajectory.
The survey also found that the market size will grow to over $381.28 billion by 2027
8. Mobile Wallets and Payment Advances
The adoption of mobile wallets and contactless payments has seen a sharp increase, driven by consumer demand for convenience and speed.
The growth in popularity of mobile wallets isn’t going to deter anytime soon as the Global Mobile Wallets statistics from Citcon estimate the mobile wallet market to reach $12 trillion by 2027.
9. Personal Finance Management (PFM) Tools
Apps and tools for personal finance management have become indispensable for consumers aiming to improve their financial health and help them keep track of their expenses.
The Personal Finance Management Report from Business Insider found that 75% of respondents preferred using PFM tools from their primary financial service provider.
Recent trends also showed technical features and ease of use to be significant considerations when choosing the best personal finance app.
10. Cybersecurity Enhancements in Fintech
Emerging technologies are being deployed to combat financial fraud and enhance cybersecurity training in fintech and, in fact, in almost all tech sectors. Due to data sensitivity and cloud accessibility, tips on, for instance, how to choose an LMS, project management software or any other software category, almost always include strong cybersecurity—much more critically in fintech.
However, the 2023 Pulse of FinTech Market Survey by KPMG found that the global funding in fintech cybersecurity saw a drop in 2023 with estimates of a rise in investments with the popularity of AI-based security solutions in 2024.
11. Big Data and Analytics for Personalization
Big Data is at the forefront of personalizing financial services, allowing for more tailored products and services in the fintech sector.
Perhaps the biggest advantage of Big Data in Fintech is enjoyed by banks as the latest study by Zipdo found that banks see a $300 billion increase in potential cost savings from using Big Data and AI-based applications.
12. Voice Technology in Banking
The integration of voice technology in banking is enhancing customer interactions, with voice-assisted services becoming more common.
One such trend that’s gaining traction is voice-based payment which uses voice-authentication to provide a more secure payment experience.
And a recent Research and Markets study on the Global Voice-based Payments Market backs this up, predicting a market growth of over $14.66 billion CAGR by 2030.
13. Sustainable and Green Finance
Financing projects with a positive environmental impact is gaining traction, with sustainable and green finance initiatives on the rise.
Advancements in fintech have presented a lot of opportunities of growth in the sustainable finance industry with the growth trajectory on the upward in 2024 and beyond.
And we see this clearly in the Sustainable Finance Market Growth Statistics from Global Market Insights here.
14. Embedded Finance in Non-Financial Products
Embedded finance is expanding, with financial services being integrated into non-financial platforms and products.
The popularity of embedded finance comes from how convenient it makes financial services and non-financial collaborations.
We get a hint of this in OpenPayd’s Embedded Finance Survey in which they found that more than 55% of companies will start including embedded finance solutions in their products in the next 2 years.
But understanding complex offerings like embedded finance is no walk in the park and fintech companies understand this very well.
This explains why there is a preference for fintech explainer videos among fintech companies in recent years.
15. Quantum Computing’s Role in Fintech
Quantum computing is beginning to influence fintech, with its potential to revolutionize data processing and security on a scale that far exceeds the capabilities of traditional financial services.
A study by Deloitte Insights found that the financial services industry’s spending on quantum computing is set to increase massively and amount to almost $34 billion.
16. Open Banking and Financial Data Sharing
Open banking and financial data sharing are fostering innovation and enhancing customer experiences.
Insider Intelligence and eMarketer’s survey on Open Banking in the UK found that almost 41% of the UK’s population were users of open banking and is set to see a sharp increase by 2026.
17. Digital Currencies and Central Bank Digital Currencies (CBDCs)
The rise of central bank digital currencies (CBDCs) marks a significant shift in the financial landscape and brings new opportunities to the fintech industry.
Statista’s February 2024 report on the CBDCs found that more than 111 countries have seriously started the development of their own Central Bank Digital Currencies.
18. Cross-Border Payments
Innovations in FinTech are transforming cross-border payments, making international transactions faster and more cost-effective.
FXC Intelligence’s report found that the consumer and B2B cross-border payments market size is set to grow to $65 trillion by 2030 and a majority of this growth has been possible due to the increased adoption of fintech in recent years.
19. The Rise of Financial NFTs
Non-Fungible Tokens (NFTs) are becoming increasingly popular in representing asset ownership and transfer on the blockchain.
And with the integration of blockchain into fintech, NFTs have become a viable financial investment offering alongside cryptocurrency in 2024.
And the WorldwideNFT Revenue Statistics from Statista also point out this fact, estimating global revenue to surpass $6.9 billion by 2025.
20. The Gig Economy and Fintech
Fintech is providing tailored solutions for freelancers and members of the gig economy, addressing their unique financial needs.
By making cross-border transactions and online payments simpler, FinTech has helped the gig economy grow in ways never seen before.
So much so that a Prove’s report on Gig Economy from a FinTech lens found that the gig economy has surpassed $455B in Gross Volume Transactions, thanks to the innovations in fintech.
Conclusion
As we took a closer look into the current fintech trends for 2024, it’s clear that the potential impact of these developments is profound.
From the integration of blockchain technology and the rise of decentralized finance to the adoption of AI and machine learning for personalized financial services, these trends signify a pivotal shift towards a more accessible, secure, and efficient financial landscape.
This transformation presents not only challenges but also immense opportunities for innovation and growth in personal and corporate financial strategies.
By embracing these changes, individuals and businesses can leverage the advancements in fintech to enhance their financial well-being, operational efficiency, and competitive edge.
As we navigate through these exciting times, staying informed and adaptable will be key to thriving in the ever-evolving world of finance.
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