Top 9 FinTech Trends to Follow in 2023
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Fintech trends are drastically changing the industry from year to year. According to McKinsey, this decade is a time of unprecedented digital progress. The world strives for digital transformation, and it remains the top priority for businesses these days.
In this regard, the relationship between technology and finance is illustrative. As Deloitte reports, fintech investment increased to $36.2 billion in the third quarter of 2021, up 153% from $14.3 billion in the same period last year, which is the highest fintech funding for any quarter since 1998. Given this fintech market statistics, the app development in this sphere will inevitably witness a rise in in volume and the number of sophisticated technologies adopted.
As the financial technology sector continues to grow and shape our economy, many new ideas and technologies disrupt how businesses interact with customers worldwide. From blockchain-based smart contracts to AI-powered chatbots, here are the emerging fintech trends for 2022. Taking advantage of the latest financial technology trends, our company has developed several solutions within the scope of fintech software development services. Previously, we have already talked about how blockchain is used in real estate.
Why Fintech Apps Are on the Rise
Simply put, fintech apps are demanded because they bring substantial benefits to both users and financial institutions.
Fintech is changing our relationship with banks and traditional financial institutions, lowering barriers to entry, and changing attitudes. By covering the underserved areas of banking, the technology allows the development of previously unprofitable areas, including retail banking and low-margin business models. In return, greater inclusiveness increases the trust level from customers. And all this happens with the thought of bringing customers top user experience, fueling the development of new fintech app trends.
Main Factors that Will Shape Fintech Industry for 2022
We live in the era of fast development and increased uncertainty, so the rapid growth combined with sudden disruptions are two major factors that possess severe challenges for top tech trends in fintech for 2022. Even though we cannot predict Black Swan events that may happen, here are the top 3 problems the technology is about to overcome in the nearest future: COVID-19, open banking, and regulations.
These factors shape the priority of fintech technology trends in 2022 towards developing high-quality financial services in the social distancing reality that is safe and compliant with traditional banking regulations.
Although the times of global lockdown seem to be over, the impact of COVID-19 on digital transformation remains stable for the coming years. The pandemic forced us to adapt, and the lessons learned are about to stay and generate new opportunities. For fintech trends 2022, COVID was both a challenge and an opportunity that inspired technological solutions, giving rise to new ways of implementing high-technology banking transactions that improve security and efficiency.
These innovations will become more accessible thanks to faster broadband connections (x100), more commonly available worldwide by 2022: fiber optics are already spreading across China and Europe, while 5G networks are being tested globally.
Open banking is a challenge for fintech app development due to security concerns. As the trend requires companies to release APIs to external organizations, a third-party actor may get easy access to capture sensitive data such as payment details. Also, there is no guarantee that they will not be compromised through weak passwords or phishing attacks on those apps. That’s why fintech security will become the major problem software developers will solve next year.
Regulations for finance are always strict, and this factor requires fintech apps to develop quickly but adapt wisely. Next year, technological advancements will play a vital role in many aspects of financial services, including:
- cost savings, as fintech can be considerably cheaper to run than legacy systems
- better data handling to offer better customer service
- improved audit tracking for reducing risk
- faster application processing speeds and overall business cycle optimization.
At the same time, each of these adjustments will pass the strict regulation and discussions on compliance with the traditional finance norms and standards.
Top 9 Fintech Industry Trends for 2022
The fintech industry has grown rapidly in the past few years, and it is expected to continue expanding at a rapid pace. We highlight some of these latest fintech trends and explain how they are likely to change the face of banking in the coming decade.
Artificial Intelligence (AI)
AI algorithms provide an outstanding opportunity to make accurate predictions based on historical data patterns. In addition to providing analytical insights, this AI feature helps gather unstructured Big Data within an enterprise. These factors put AI among the top technology trends for fintech and beyond in 2022.
At the same time, fintech startups can also benefit from adopting some particular technologies. AI can be adopted as the basis for a propensity model, a chatbot using Natural Language Processing, or a face recognition technology for the financial world. AI will reveal its best in large companies that deal with big data sets in all these cases.
Robotic Process Automation (RPA)
RPA, or Robotic Process Automation, is a fintech technology trend gaining traction across all industries. Given its helpful ability to hyper automate the existing processes, we expect RPA tech trends to continue being on a positive trajectory over the next few years, with the adoption of robots and machine learning technologies increasing.
With increased pressure on banks to deliver flexible and personalized solutions to customers, RPA will likely play a significant role in 2022. By harnessing powerful process automation tools, organizations can design and deploy intelligent bots that can interact with software interfaces and applications – making decisions about what to do when specific triggers occur. It follows that RPA is also one of the biggest fintech trends.
Computer programs that simulate conversation with a human user via text, voice, or video are used on messaging platforms across different industries, including customer service, hospitality, social media marketing, and sales. Commonly, it works as an automated customer service agent that answers simple queries via instant messenger (IM).
For fintech, chatbots are useful for increasing trust and serving international customers more effectively. Mainly, they work as informational, transactional, or advisory assistance for users. For example, clients can check their balance and request a new insurance package more effectively and cheaper. And this is another emerging fintech trend that cannot be passed by.
Blockchain technology is an extremely versatile invention, and its potential uses span several industries, with the financial sector already adopting multiple applications. In particular, financial institutions are using blockchain to reduce risks and increase security, while other businesses explore blockchain as a way to cut costs and improve efficiencies. In 2023, the new blockchain technology is expected to move towards greater security and applicability of its smart contracts.
Microservices is another way to achieve greater security in fintech during 2022. Also, they possess great value-for-money to gain more popularity next year.
Also labeled as small form factor (SFF) server architecture, microservers are efficient, dense, and powerful. Each microserver is designed to reduce the size, power usage, and capital expenses, and together, microservers can host small-scale applications and data that don’t need full services from conventional large enterprise hardware.
Voice recognition technology is the fintech trend that is expected to achieve greater popularity in 2022. However, its further development is currently questioned. Notwithstanding the Statista prediction that voice command units will reach 8.4 billion by 2024, there are still many people who still don’t trust voice commands yet. Therefore, the ability to adapt the technology widely depends on its security standards.
Cases like Revolut have shown that mobile banking is likely to change the way we interact with banks to the core. After experiencing the convenience of using mobile wallets to make purchases, users want financial institutions to bring even more convenience to them — and shift all their services into an app.
Among mobile banking tech trends, facial recognition and ensuring a sufficient safety level. Instead of spending lots of time waiting and handling bureaucratic requirements, users can process their loans with a couple of clicks.
Autonomous finance, or "self-serving money," is an AI-empowered innovation that lets design and execute an app's financial plan. All users need to input their personal goals and balances, and the digital assistant will help them start investing, make savings, and forward funds to charity. Thanks to these features, autonomous finance is about to revolutionize the sphere of personal finance.
With a heightened regulatory focus on security and transparency and advanced mobile payments integration, acquiring technology will become among the new tech trends for fintech in 2022. This is especially true in fraud prevention or innovative product development.
Innovative payment services providers such as Klarna or Stripe are already paving new ways for effective online customer service with their cutting-edge offering of digital products; therefore, improving the eCommerce experience even further.
Fintech App Trends in Development Process
If you are planning to develop a fintech app, it’s important to take into account the latest fintech app trends and stick to the app development process and invest in the solution's innovativeness, safety, and effectiveness. Along with fintech technology market analysis, proper attention to the tech side during execution will let you streamline certain processes, leverage business opportunities as they arise, and innovate rapidly.
In the application development process, there are 3 main evergreen fintech app development trends, these are:
- Define the Key Feature. We recommend picking the killer feature that your app will do better than all the others so that you will attract your future customers to this particular service. Once this feature is picked, stick to it from the beginning of the development process and remain consistent until the end.
- Pick the Right Vendor. It’s important to find a true tech partner for your fintech app development or a team capable of ideating and executing your project on their own. To find the right one, we recommend paying attention to the portfolio of your future software provider, level of expertise in your sphere, and ability to answer some business-critical questions from the very beginning, like an approximate cost of a future fintech app. We recommend going for outsourcing, as this decision will let you save your budget on developing sophisticated features instead of spending money on expensive hourly rates of software engineers.
- Build an MVP First. MVP development is one of the best strategies for businesses, and fintech app development is not an exception to this rule. Given the high complexity of fintech apps, seeing some core problems in MVP will help you create a high-quality product that works smoothly even when you add all the extra features planned.
If you are planning to develop a fintech app, it’s important to stick to the app development process and invest in the solution's innovativeness, safety, and effectiveness.
How Softermii Uses Fintech Trends in App Development
For ExtoBit, a cryptocurrency exchanger, we’ve taken responsibility for the entire technical side, marketing, and UI/UX decision-making during the project.
ExtoBit allows making hyper-quick transactions that are very convenient for users. What’s more, the exchanger has lucrative exchange rate pricing deals for their long-term members and special offerings for their affiliates. At the same time, the business came to us for assistance in making their fintech solution stand out among numerous cryptocurrency projects.
For the project, we’ve concentrated on safety and marketing. These days, cryptocurrency still operates at a high level of uncertainty, and providing safety of money transfers is a real challenge. As for the marketing, we needed to select the list of selling points that will help the client stand out in the sharp competition.
The technical solution Softermii was built on C# with the back-end divided into isolated applications that strengthen the overall security. The back-end applications used ASP.NET Core framework, MS SQL Server is the database engine, and front-end programming was executed with Vanilla JS and React.
We’ve introduced and clearly communicated six levels of membership users can choose from in terms of marketing. As a result, ExtoBit has opened with a consistent number of early adopters and still keeps expanding its user base.
Read Also: How to Build a P2P Payment App for Money Transfer?
Fintech Trends: Conclusion
So, we expect the exponential growth of fintech solutions in 2022. Given the importance of social distancing and the increasing safety concerns, the current and new technologies will incorporate relevant features to meet this goal. Therefore, your tech partner should be aware of these latest top fintech technology trends to build an up-to-date solution that will meet your business goals.
We at Softermii work on building the future of world finance and assist businesses to join the digital transformation smoothly and effectively. From our set of fintech development capabilities, you can request:
- Cryptocurrency software services
- Blockchain technology
- Smart contracts
- New types of cryptocurrency
- Services for exchanges and exchangers (including assistance with entering ExtoBit)
- Financial advisor-bots
- InsureTech (fintech services for the insurance sector)
- RegTech (to meet regulations)
- Third-party banking
- Financial inclusion
- Increasing security of information
- Post-launch supervision
- Project management
Contact the Softermii team directly! Our developers have vast experience finding the best tech stack for fintech solutions and will deliver the most wanted service for your business needs.
Frequently Asked Questions
In mobile app development for fintech, our mission is to code and rethink the whole user's journey within the solution and create a fresh visual appearance that would breathe new life into the product. So our business analytics and design team step up first, only to connect developers to the process of creating highly functional fintech solutions.
One of the critical challenges in developing any fintech solution is to keep abreast of all the recent innovations on the market providing a high functional, seamless and user-friendly solution for every demographic.
The main goal of any fintech app is to solve user’s problems by introducing a seamlessly working A to Z process for both – businesses and users. To develop a successful fintech app, it’s critical to work with professionals who already have experience integrating complicated systems into a mobile app.
When it comes to mobile app development, the tech stack differs based on the app type. For Android, the programming languages include Java and Kotlin, while iOS apps are written on Objective-C and Swift mostly. The programming tools are Android Studio & Android Developers Tool (for Android) or XCode (for iOS).
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