In many parts of the globe, fintech investment and interest grew substantially in 2021. The technology’s scope is now much wider than its initial definition. As we move into 2022, this expanding scope and the maturing of many fintech subsectors will continue to drive investment. Here are the top predictions for fintech markets globally in the future:
1. Embedded solutions will be offered by a growing number of banks
Embedded Finance has been one of the rising fintech banking trends of the last year. It is well-positioned for growth as many banks look to become service providers of non-bank and financial institutions that are looking to offer a customer experience.
2. Embedded finance offerings will face increased regulatory scrutiny
As regulators seek to protect customers, they will be increasing regulatory awareness and intervention as a result of the increase in financial products and services that are embedded within or delivered by non-regulated entities.
3. Fintechs will be able to brand themselves as data organisations.
Many fintechs will be reinvented into data organizations or data providers, which provide financial services and payments to investors to help them stand out from the rest.
4. ESG-focused fintechs are expected to see a huge growth rate
Due to the increasing importance of ESG, fintechs that have ESG capabilities will be more in demand, especially companies that are focused on climate change, decarbonization and the circular economy.
5. Dealmaking in the underdeveloped areas will get a greater focus.
Investors will increase their focus on jurisdictions that are underdeveloped in financial services. This could mean more deals in areas like Africa, Southeast Asia and Latin America.
6. While Unicorn status may lose some of its luster in developed markets it will remain important in emerging markets
The phenomenal rise in unicorn companies, especially in the US, will likely make this status less valuable to companies in developed countries. However, it should still be an important building block of startups in emerging markets as well as less mature fintech hubs.
