Top Fintech Trends Reshaping Finance

A Statista study projected that the revenue of the global fintech industry increased sharply between 2017 and 2023. In 2023, the industry's total revenue was estimated at 79.38 billion U.S. dollars and will exceed 141.18 billion in 2028.

If you are considering a career in banking and finance, you will have access to many more opportunities and can choose from a diverse pool of banking and finance jobs across various domains.

In this article, we’ll look at the top trends that rule fintech to help you understand the future of fintech companies and jobs. Furthermore, we’ll discuss the best courses to pursue a career in fintech.

What is Fintech?

So, what exactly is fintech? Fintech, short for financial technology, combines finance and technology.

Any technologies that help people and businesses easily use financial services are examples of fintech. The services could be anything related to finance -­­­­­­­ banking, insurance services, loans, investments and beyond.

Some more examples of fintech that we use in daily life are:

• Mobile banking
• Peer-to-peer payment services
• Automated portfolio managers
• Trading platforms, etc

Did You Know?

Fintech was born out of the 2008 recession. Amid widespread distrust in traditional finance, entrepreneurs like tech titan Elon Musk looked for solutions that eventually birthed a wave of innovative fintech companies.

Now, entrepreneurs, companies, and other individuals widely use fintech to streamline complex financial processes.

According to Forbes, 68% of people are willing to use fintech tools as they make their financial journey more personalised and seamless.

What are the Five Key Fintech Trends to be Aware of?

1. Embedded Finance

Embedded finance is one of the most popular fintech industry trends of 2024. And it is likely to gain more popularity in the coming years. Imagine a world where banking fits effortlessly with your everyday routine, like getting instant car insurance while buying a car.

Overall, embedded finance combines banking services into non-financial products and platforms.

Examples:

• Google Pay and Apple Pay embedded payments.
• Buy now pay later options (BNPL) – popular among millennials and Gen Zs because they prefer this option over credit cards. (Source: CNBC)

2. Artificial Intelligence and Machine Learning

The emergence of AL/ML is considered one of the significant impacts of technology on financial markets.

The AI/ML fintech market is poised to hit $26.67 billion by 2026, growing at a steady rate of 23.7% in 2021-2026. (Source: DataArt)

Fintech companies use AI/ML technologies to automate processes such as fraud detection, risk assessment, and personalised financial advice. It helps companies cut costs, enhance efficiency, and provide personalised solutions.

Examples:

• Plaid, a financial services company, uses AI and ML models to stop fraud and protect your money in real-time.
• AI-powered chatbots for customer support and financial inquiries

3. Digital Banking

When was the last time you used actual cash to pay for something? The rise of digital banking has reduced the need for physical cash and credit cards in many financial transactions.

The global digital banking platform market is projected to grow each year by 11.25% by 2026. (Source: MarketsandMarkets)

Examples:

• Cashless payments
• Investment services

4. Regtech

One of the latest emerging technologies in fintech, Regtech(Regulatory Technology), is the use of information technology to simplify regulatory and compliance processes.

A growing burden of regulatory compliances leads to many fintech companies focusing on providing regtech solutions.

Every business faces a mountain of paperwork, such as accounting records, tax reports, and income reports. These reports are to be submitted to regulatory institutions for annual checks.

In this scenario, regtech detects any issues that do not comply with rules and regulations. Think of it as a financial watchdog powered by smart technology.

Examples:

• KYC and Anti-money laundering software
• Regulatory reporting software

5. Blockchain

Fintech companies use blockchain technology to create a system (a common ledger of transactions) where everyone can trust the record of transactions. Imagine a public scoreboard that everyone can see and agree on.

A PWC analysis reports that in 2025, blockchain will be adopted on a large scale in global economies. (Source: PWC)

Examples:

• The bitcoin system is the best-known application of blockchain.
• Decentralised Finance (DeFi) applications, non-fungible tokens (NFTs).

What are the Benefits of Fintech?

You are probably familiar with traditional banking, a classic yet relevant approach to financial services.

Traditional banking is done by financial institutions licensed to accept deposits and grant loans to an individual or business. Corporate banks, retail banks, or investment banks are examples of traditional banking.

Fintech companies are viewed as traditional banks’ main competitors because of the differences in their practices and procedures.

Let’s look at what sets fintech apart from traditional banking.

1. Structure and Function: Customer Focus

Ever heard of the infamous saying ‘the customer is the king’? Fintech takes the phrase quite literally. Fintech companies are innovative and customer-oriented. They aim to simplify complex financial procedures.

Fintech companies use evolving tech like big data, artificial intelligence, machine learning, and cloud computing for personalisation.

On the other hand, traditional banking is more process-oriented than fintech. They are more regulated than fintech companies. Typically, a central bank or national government institutes regulate these conventional banks.

2. Business Models: Flexible and Competent

Traditional and fintech companies provide the same services but in different modes.

For example, to create an account or to get a loan from a traditional bank, you may need to go to their branch, do paperwork, and confirm your identification.

Fintech companies, on the other hand, run virtually using practical mobile applications or an API (Application Programming Interface) interface.

3. Growth Potential: Exponential and Increasing Value

The growing importance of technology for companies and people to manage personal and business finances gives a competitive advantage to fintech companies over traditional banking.

Moreover, the young generation is increasingly opting for digital banking as an easy way to manage their finances.

Now, going back to the question, ‘What does this mean for you’?

Hundreds and thousands of jobs have been created because of the fintech boom, which shows no signs of slowing down. Some of the future fintech jobs include:

• Financial analyst
• Fintech AI specialist
• Cloud and cyber security operations
• Blockchain

London School of Business & Finance, Singapore Campus (LSBF SG Campus) is known for its popular Banking and Finance courses. LSBF provides high-quality education with industry-relevant curriculums and placement drives.

You have several options in banking and finance courses:

• Postgraduate programmes: Perfect for in-depth specialisation and research
• Diplomas: Ideal for upskilling and boosting your career.
• Undergraduate programmes: Lay the foundation for your banking and finance career.

 A blog written by Serin Thankam Sam and edited by Taylor Gardner.

FAQs

1. Is fintech the future of finance?

It is safe to say that fintech is not just a passing trend. It is transforming the financial landscape and driving the finance industries’ future with emerging technologies like blockchain, artificial intelligence, open banking, regtech, etc. Fintech is changing how people and organisations manage finance. Their focus on convenience, accessibility, and personalisation is drawing an ever-growing user base.

2. How has fintech changed the finance industry?

One major area in which fintech has notably changed the finance industry is transforming the customer experience. Fintech has made financial services more efficient, accessible, and personalised. It’s changing the way people think about and manage their finances.

The emergence of open banking, embedded finance, artificial intelligence, and central bank digital currencies promise a more dynamic and personalised future for the finance industry.