As the fintech industry is well aware, the last year has not been without its difficulties. From ongoing Covid-19 global pandemic, to rumours of an imminent recession and huge layoffs, the financial industry has experienced tremendous uncertainty. In this blog, we discuss everything you need to know about the future of the fintech industry ahead of the year.
Across the last year, the fintech industry has seen substantial innovation, with new payment products and services reshaping how people pay and get paid. There has been a noticeable increased focus on blockchain, rising popularity in Buy Now Pay Later schemes, and open banking is even starting to make an impact.
The cost of living troubles, economic uncertainty, and the recession will only continue to encourage change within the next year. We’re going to see more firms become more innovative as they seek support and stability during these challenging times. Bigger tech companies are set to invest in financial services, whereas the smaller businesses will be planning to adopt various payment trends as they draw in the interest of the consumer.
With that being said – what can we expect to see within the next year, and are they existing payment trends set to continue?
What to expect in FinTech?
Mobile Payments – The amount of smartphone users continues to increase each year, and by 2024, mobile payments is expected to hold 43% of the e-commerce market.
Since the Covid-19 crisis, mobile payments have continued to grow in popularity over the last year. The popularity of mobile wallets, QR codes, and tap-to-pay solutions will continue to rise in the next year as the demand of quick and easy payments is always wanted by customers.
Customer Experience – The financial pressures of the cost of living crisis has emphasised the significance of customer experience to many businesses. Customers are looking for organisations that understand their financial difficulties and offer flexible payment alternatives that suit them and handle their challenges as inflation continues to rise at an all-time high – this is highlighting the importance of listening to what customers are currently wanting and incorporating that into the buying process
Brand loyalty is currently at an all-time low, with individuals keen to switch from one brand to another if their customer experience or payment experience falls short of their expectations. Due to this, we will be seeing more businesses start to focus on improving their customer experience because of the long-term importance of brand loyalty.
AI – By automating procedures and utilising AI’s valuable learning capabilities with data, businesses have the opportunity to save a lot of time and effort. Customer data can be used to help better analyse payment behaviours and intent to pay, as well as to develop personalised collection activities that are tailored to suit the needs of customers.
Gathering insights from various data streams within an organisation will provide a wider perspective of customers’ needs, which will allow you to create more of an accurate and personalised payment function. This added visibility in a company will definitely be an asset in the next year.
Customer Demand – Personalised payments have emerged as a crucial distinction among most tech companies. Consumers simply want to feel valued and supported, especially during a financial crisis – and having things like flexible billing dates that can align with payday for consumers will build a stronger relationship between both parties.
People will always be looking to have greater control over their finances, especially when money is tight. With the demand for greater financial autonomy rising, you should expect to see a shift from outdated payment methods like direct debits, especially when cash pressures are intensifying during the current cost of living crisis.
It’s tough to predict how the next year is going to turn out. However, it’s certain that 2023 will be a big year for the fintech industry, with new regulations, market trends, and various technological transformations.
Fintech related trends could also have an impact on an organisation that aren’t necessarily part of the sector. Therefore, DeFi and Blockchain, RegTech, AI and contactless payments are all trends to look out for across the next year.
This next year is going to be interesting for the fintech industry – let us know your thoughts!