Industry experts predict the trends that will dominate fintech by 2024:
- Increased use of digital assets: Alex Balazs, CTO at Intuit, suggests that Digital assets will be at the forefront of fintech growth due to its expanding use case, such as tracking automobile titles and property deeds. The technology enables aspects like age verification without revealing actual birth dates and speeds up loan approvals.
- Fintech to become more data-driven: Richi Hartmann, director of community and office of the CTO at Grafana Labs, believes that technology will be leveraged to optimize IT budgets and to closely correlate cost and profit centers.
- Preparation for Payment Services Directive 3 (PSD3): Financial services companies need to prepare for PSD3, a new set of rules governing the EU payment markets that is expected to come into force by the end of 2024. Companies need to review and adjust their processes and compliance protocols accordingly, says Marius Galdikas, CEO at ConnectPay.
- Shift to Banking-as-a-Service model: Galdikas also predicts a shift towards Banking-as-a-Service, wherein providers could also handle onboarding, authentication, monitoring thereby allowing fintechs to concentrate on their core business.
- Convergence of fintech and healthcare: Ryan Brown, regional VP, Trial Landscape at H1, predicts that FinTech will merge with HealthTech to provide tailored healthcare services and increase patient trust.
- Move away from passwords to secure financial assets: In light of the growing adoption of passkey technology by tech giants, Anna Pobletts, head of passwordless at 1Password, expects the fintech and banking sector to follow suit in 2024.
All these predictions suggest a rapid evolution in the fintech landscape, driven by technological innovations and regulatory shifts. Whether it’s the embrace of digital assets or a data-driven approach to operations, these changes present both opportunities and challenges to traditional and new players alike in the sector. The increasing convergence of fintech with sectors such as HealthTech and the potential implications of the proposed PSD3 regulations also suggest a need for companies to maintain a flexible and adaptive approach to their business strategies.
Moreover, Galdikas’ view of a shift towards a Banking-as-a-Service model highlights the potential for technological solutions to streamline operations and reduce the complexity of regulatory compliance. Similarly, Brown’s anticipation of a merger between fintech and healthcare could open up new avenues for collaboration and innovation. Finally, Pobletts’ comments underscore the ongoing trend towards passwordless authentication, which could provide a competitive advantage to financial services companies through improving both security and user experience.
As the fintech sector continues to evolve, it seems certain that the role of technology will only become more central. The task for companies within the sector will be to stay ahead of these trends and find ways to leverage them for success.
