Top 10 Fintech Trends 2022
Since the onset of the pandemic, the stir caused by the wave of fintech has overshadowed traditional banking and financial methods. In the past few years, tremendous changes have occurred, bringing novel solutions and ideas for banking, payments, data sharing, etc. There are about 315 companies holding a unicorn status in the fintech industry. With such rapid development and the extent of applied technology, the bucket is still brimming with opportunities.
The disruptive technologies that shook the entire system in 2021 ranged from the massive incorporation of Artificial Intelligence and Machine Learning, a deeper involvement of RegTech, Open APIs (Application Programming Interface) used in Open Banking, and BNPL (Buy Now Pay Later).
Though these technologies are still inching towards their peaks, the projected trends for 2022 include a couple of newer areas that are gradually gaining ground.
Top 10 Fintech Trends to Watch Out for in 2022
A Win for Embedded Finance
2021 saw the rise of embedded finance in more and more banks looking to grow their portfolios to suit the needs of their customers. Embedded finance allows the customer to get credit without leaving the platform. With this, companies can provide small credit facilities to customers to enable them to make their purchases. BNPL is one example of embedded finance, which has taken the market by storm. The technologies, payment methods, and solutions offered under this cap are likely to expand in 2022.
The Scope of Web3
Web3 is a buzzword that has attracted a large audience owing to its brilliance combined with quirkiness. With more people wanting to expand their digital assets and purchases, the fintech industry is booming with innovation in this field.
The Growing Importance of Blockchains
Virtual reality has gained popularity for its existence as the digital counterpart of the world, resulting in people purchasing and investing in digital assets using cryptocurrencies. As these currencies are supported and operated using blockchains, the world of fintech is slowly ballooning to accommodate the scope blockchains encompass.
Cross-Border e-Commerce
International payments are soaring due to the influx of technologically-equipped solutions everywhere. P2P payments and transfers are becoming non-negotiable, and banks and companies are targeting easier facilitation of cross-border payments.
Usability of Super Apps
Super Apps like AliPay are dominating specific markets. Super Apps are mobile applications that are not restricted to one service, enabling them to provide a range of services like purchasing groceries, booking taxis, and purchasing clothes and other items all in one place. The adoption rate of the idea of super apps has incentivized many companies to head in this direction. While AliPay and WeChat are active in Asian countries, the Western market is yet to exploit the opportunities Super Apps project.
Efficient RPA
Robotic Process Automation is the engagement of robotic technologies to automate processes to reduce the involvement of humans. This shift enables quicker and more efficient processes that substantially reduce the possibilities of human errors. RPA can be incorporated into a wide range of services, like conducting security and background checks, processing credit cards, customer onboarding, etc.
Practical Biometrics
With regulations becoming more agile and dynamic owing to the fast-moving nature of fintech, biometrics is one field that is said to be the future of the regulatory system. With more people owning and using smartphones, voice commands, face recognition, fingerprints, etc., would be used more extensively for verification purposes in the future.
RegTech
Because of the rapidly changing landscape of fintech, regulatory authorities must stay connected with all developments in all markets. Such dynamism requires regulations and technologies that are agile and more adaptive to the surrounding changes. RegTech is an integral part of fintech, making it one of the most crucial fields in fintech.
Targeting Underdeveloped Regions
There is an enormous strength of unbanked and underbanked people in underdeveloped regions that are yet to become a formal part of the banking sector. A large number of underbanked and unbanked persons presents a new opportunity for fintech to partake in, where it can provide services and products that cater to this category, where traditional banking has not penetrated successfully.
Sustainable Finance
With the climate crisis predominating every sector and field, it is imperative for the fintech industry to build a foundation that offers sustainable solutions. With people going cashless, the onset of sustainable practices is already evident. Sustainable finance is a vast area that is yet to become absolutely constitutional.
Closing Thoughts
The aim of fintech has been the betterment of financial services by building a more customer-centric system. In 2022, these trends are already making rounds. While some technologies may take off immediately, others might require more time and alterations. Customer-centric financial services that are quick, compliant, and efficient are the guiding lights of fintech, which are going to guide the momentum of this industry.
