Top 5 Fintech Trends to Watch in 2022

  • Sabrina Akramova, Editor & Content Manager at Financial IT

  • 14.01.2022 05:45 am
  • #fintech #trends #banking #nft #blockchain #payment #bnpl

An astonishingly rapid rise in demand for innovations after the COVID-19 outburst in early 2020 has been a reminder of the power technologies have over the whole world. Fintech is not an exception. Although it seems that contactless payments, blockchains, and NFTs appeared almost instantly, they are the products of decades of research and hard work. It would be more correct to say that it takes years to create a trend in the sphere of IT. So, what fintech trends are worth watching in 2022?

Trend #1 

Buy-Now-Pay-Later (BNPL) goes popular

Ten years ago, people could not imagine an opportunity to shop at favorite stores and pay over time. Today, the latest technological advancements make online shopping and contactless delivery services available even in remote parts of our planet. Nevertheless, the progress keeps going further. In order to empower customers to access what they love and need, while still allowing them to keep their financial well-being under control, many retailers started collaborating with such apps, as Klarna or Afterpay to make the payment process easier. These applications complete similar tasks as credit cards, however, they typically charge very low interest or even no interest at all as long as users pay for the purchased items on time. 

Today, more than 17 million users in the UK have paid with the help of BNPL applications at least once so far. According to the insights, the significant rise in the customer base of Klarna was witnessed in 2020 after the most part of the world went online due to stay-home policies. What’s more interesting, BNPL is not a millennial trend anymore – users in their 40s and 50s are adopting online shopping with split purchase installments quite successfully! The main reason for this is BNPL’s convenience and flexibility – consumers are free to pay at their own pace without visiting the physical store. 

Trend #2

Banking systems become even more digitized 

How many people still associate the banks with long queues, endless paperwork, and busy staff? Although there are many banks that still stick to the traditional methods of serving their customers, digitized banking systems present outstanding performance and bring real results. Such new banks as Atom Bank in the UK, MobileBank in the US and Fidor Bank in Germany can be called “digital banks” for the list of provided “digital-only” services, which include:

- Simplified process of signing up for a new account by uploading personal photographs and providing a minimum of information.

- Ordering plastic cards from home with the help of mobile applications.

- Keeping track of account balances through application without visiting the physical bank.

In 2022 the number of digital banks will significantly rise due to increased demand for “digital only” banking systems and cut-throat competition. Moreover, Omicron waves may restrain citizens from visiting public places, which will push digitization even harder than in 2020.

Trend #3

Further evolution of blockchain

Which topics were the hottest in 2021? Undoubtedly, blockchains, cryptocurrencies, metaverse, and NFTs. Presentations on CES-2022 proved the fact these buzzwords have true potential to transform websites into “blockchain-based user interfaces” and traditional payment methods into “cryptocurrency payments”. We will probably be witnessing complex NFT-integrations with popular games, the emergence of extensive NFT-markets in a virtual world, however, there’s a lot of uphill climbing ahead. Increased public awareness about blockchain will definitely take several years until it becomes mainstream.

Trend #4 

Fintech regulations will go more complex

As rapid changes were always scary, government officials tend to get nervous about new technologies, AI and unfamiliar algorithms. As a result, fintech regulations need to get more complex for further protection of personal data and effective risk management. Cybersecurity is a completely new sphere of IT and concerns about data protections bring new rules. According to Cybersecurity Ventures, cybercrime damage cost constituted about $6 trillion in 2021, which is overwhelming! 

The year 2022, on the contrary, is predicted to bring new national standards, improved algorithms, and fintech regulations, which will help to decrease the annual loss. 

Trend #5

From competition to collaboration

Financial institutions and banks used to be competitors for a long time, but this is not a deal anymore. Even if competition can be beneficial for the development of any business, there is a common goal – to digitize financial transactions around the world and keep the products up to date. This can’t be done without proper exchange of information, mutual trust, diversified assistance & support. In addition to this, the majority of Gen Y and Gen Z are already forming a working population, whose changing demands are gradually drawing a new vibrant market. Thus, banks and financial institutions have no other choice but to adapt to the increasingly challenging needs of modern society. 

It is important to view this unique situation positively as long as new entrants in the FinTech industry are focusing on substantial and sustainable Business Value with the help of main development triggers – innovations. Innovations bring convenience, convenience brings new standards, new standards bring development!

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