The pandemic of 2020 proved to be a turning event for the FinTech market trends. As corporations moved to remote working styles, there was a severe push for innovations. The finance sector evolved quickly with banking services, payment methods, and loan applications moved online. This is only a tiny part of the latest FinTech advancements during the last one-year period.
But there’s more! FinTech apps in the UK, for example, witnessed a growth of more than 50%. Similarly, in Europe, the growth was more than 72%.
Let’s take a look at the latest FinTech technology trends.
Data analytics is vital now more than ever.
Data analytics has always held a vital position among all the industries. Today, data analytics is more critical for business survival and growth. Even though most people assume that the finance sector holds the most data to work with, several challenges must be resolved. For instance, many financial institutions struggle to manage their data because they have an unstructured data processing methodology and data silo.
To resolve such issues, Fintech is among the largest investors in Big Data and Analytics.
Banking-as-a-Service is gaining momentum.
Banking-as-a-Service (BaaS) is becoming a major talking point in the banking industry. BaaS, along with embedded finance, fall under an API banking trend. Both these fields rely on Application Programming Interfaces (API) that involve using different software to communicate.
BaaS is a B2B end-to-end model that allows BaaS providers to give their banking services through APIs. The main objective of BaaS is to enable fintech startups to run their financial services and develop the latest finance solutions without establishing their bank.
Embedded financial services are the new talking point
The data-driven FinTech aims to provide banking services seamlessly and without the users even realizing it. This is possible with embedded finance – a topic raging in the FinTech world during the last few years.
Banks can integrate loans, payments insurance, and other investment instruments into any non-financial service or product with embedded finance. The idea behind embedded finance is to simplify how banking services are offered and user interaction with them. A user can access a digital platform run by an Embedded Finance Infrastructure company. The app provides all the financial services such as insurance, credit, money transfer, etc.
Open banking is becoming popular.
Open or open bank data lets banks control and access clients’ banking transactions to different companies through APIs. Here’s an example of how it works; certain financial apps help users plan their budget, monitor monthly spendings, and manage economic behavior.
These applications mostly do not belong to any bank, and they do not issue debits cards, assist in loan applications or make deposits. Rather, these apps collect real-time financial data from hundreds of financial accounts. They also ascertain credit score ratings, review transactions, and do other things. These apps provide people with valuable real-time information about their current financial situation.
Digital payments are already a rage today.
The rise in digital payments platforms’ popularity in the last year is a story for the history books. As people stayed at home during the pandemic, they looked for convenient and secure online ways to interact with their money.
These payment innovations from FinTech companies include various solutions like online payments, contactless transactions, and identity verification services.
Today, people worldwide rely on mobile and contactless payment methods for their convenience, high security, and convenience. These payment methods use secure biometrics like a fingertip, eye scan, facial recognition, etc. They also rely on identity verification to ensure the true identity of the customers. These measures are essential since there is a severe influx of new customers on these platforms, elevating the cyber security threat level. Companies like iDenfy offer identity verification solutions for finance apps and software with easy integration for faster market release and deployment.
These are some of the top FinTech trends in 2021 that will grow your business. These FinTech trends are already enabling and disrupting the market. The technological push in the last one and half years is far from stopping. As more and more financial institutions invest in the latest FinTech, we’ll get to see more hi-tech finance solutions that will make the consumer’s life easier.
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