Financial technology, commonly known as fintech is a highly anticipated topic characterized by rapid innovation and development. Looking ahead to 2024, experts have identified several key trends that will reshape the landscape of the fintech industry. Let's take a look at the fintech trends that will transform financial services and industries based on advanced information technology in 2024.
Blockchain integration and the rise of cryptocurrencies:
This trend refers to the use of blockchain technology to create secure and transparent transactions and records in the financial sector. Blockchain integration can make cross-border payments, remittances, trade finance, supply chain finance, digital identity, decentralized finance (DeFi), smart contracts, tokenization and faster, cheaper and more efficient. In particular, the increasing acceptance of cryptocurrencies by traditional financial institutions is expected to grow as regulations become clearer and the value of bitcoin rises, which is expected to reshape the global financial landscape.
Intelligent Automation:
This trend refers to the use of artificial intelligence (AI) and machine learning (ML) to automate various tasks and processes in finance, including data entry, fraud detection, customer service, and compliance. Intelligent automation can improve the efficiency, accuracy, and quality of financial services, as well as reduce costs and errors.
Increased use of AI by fintech companies:
AI is driving fintech innovation, and its use is expected to increase in 2024. The integration of AI into services ranging from robo-advisors to customer service chatbots is expected to revolutionize the way financial services are delivered. In particular, fintech-generated AI will become a trend. This is the use of AI and machine learning to generate new content or data in the financial sector, including text, images, audio, and video. Generative AI in fintech can be used for a variety of purposes, including creating financial reports, generating synthetic data for testing or training purposes, and improving customer engagement through chatbots or virtual assistants.
The Rise of Central Bank Digital Currencies:
Central bank digital currencies (CBDCs) are expected to emerge as a major trend in the fintech industry in 2024. A number of central banks are expected to develop and launch their own digital currencies, which will simplify and increase control over financial transactions.
Big data and analytics:
This trend involves the use of big data technologies to collect, store, process, and analyze large amounts of structured and unstructured data in the financial sector. Big data and analytics enable financial institutions to gain insights into customer behavior patterns, market trends, risk factors, fraud detection, and more, as well as improve operational efficiency and innovation. In particular, 2024 is expected to see an increased focus on robust cybersecurity measures, including biometrics. Biometrics will play a key role in enhancing user authentication and protecting financial information.
An increase in embedded financial solutions and mobile payments:
This trend involves the integration of financial services into non-financial platforms or applications that users already use or interact with. Embedded financial solutions can provide convenience and accessibility for customers who want to manage their finances on the go or through social media platforms. Examples of embedded financial solutions include PayPal's Venmo feature for instant in-app money transfers, Facebook's Libra cryptocurrency project, which aims to be a global digital currency, and Google's Pay app for making contactless payments from your phone. Mobile payments with embedded financial solutions are all about convenience and accessibility, and 2024 will see further development of user-friendly mobile payment solutions that meet the needs of modern consumers and further improve access to financial services.
Focus on global financial inclusion:
The most important theme in the 2024 fintech forecast is the growing emphasis on global financial inclusion. Fintech is playing a pivotal role in extending financial services to the unbanked and underbanked around the world. Initiatives focused on financial inclusion are expected to gain momentum in 2024, with fintech companies leveraging innovative solutions such as mobile banking, microfinance, and blockchain to bridge the gap. By expanding access to financial services, especially in developing countries, fintech can contribute to poverty alleviation and economic empowerment globally.
The fintech industry is rapidly evolving as we approach 2024. These trends are expected to redefine the global financial ecosystem, driving innovation and change in financial technology. However, there may be other new technologies or innovations that could disrupt the financial industry in unexpected ways. Therefore, it is important for financial institutions to stay abreast of the latest trends in fintech and take a proactive approach to embracing change, experts say.
