Fintech has rapidly developed as an industry in the last few years, providing consumers and corporations alike with a vast range of opportunities to engage with the latest financial technologies available.
Particularly in the UK, Fintech has gone from strength to strength, with an estimated over 1,600 firms in the country. This number is also expected to double by 2030.
With so much investment and innovation coming to the forefront in this exciting professional sector, it is only natural that it will continue to dominate the market for both ambitious start-ups and high street giants.
So, what exactly is Fintech? And how is it going to make an impact in 2024?
What is Fintech?
Fintech (financial technology) concerns the creation and implementation of innovative products, services, applications, software or anything else to improve financial services.
From the development of transmissions of financial information in the 19th century to ATMs and now the early development of voice banking, there is no denying that Fintech has come a long way. It is now easier than ever to access financial records and make changes in a matter of seconds.
Particularly in the UK, Fintech is continuing to grow. It is estimated that the UK Fintech market continued to outpace the rest of Europe in Fintech investment, accounting for over half (56%) of the total $6.9 billion invested across the region, highlighting just how much potential this sector has.
How is Fintech going to dominate the banking sector in 2024?
There’s no doubt that Fintech is going to shape the banking industry for many years to come. Here are three ways that it will influence 2024:
Targeting the Millennial generation
Millennials (currently aged between 23-38) are now embarking on professional careers and have more financial responsibilities than ever before. These individuals have also grown up alongside emerging technologies, meaning they are more likely to be familiar and engage with new innovations compared to previous generations.
Whether it is a fledgeling SME or a renowned large corporation, targeting Millennials in the Fintech market can prove to be widely fruitful. Particularly in retail and commercial banking, where consumers of this age are looking for the best service to suit their varying needs to help plan their long term goals, investing in Fintech could be key.
It’s no secret that the UK Fintech market is booming. According to Thomson Reuters, London sits comfortably in the top five locations in the world for Fintech hubs, beaten only by Singapore and Switzerland. It has also recently emerged that 12 Canadian Fintech companies are looking to set-up operations in the UK market in the near future, further highlighting its strength.
The widespread success of digital banks such as Monzo and Revolut in the UK have contributed to additional funding and increased market opportunities in Fintech, and 2024 is set to follow the same trend.
Even more innovation
With so much innovation and competition among Fintech start-ups and long term businesses, there is no doubting that 2024 will pose new ways to manage financial affairs.
As previously mentioned, voice banking is now in its early stages of development. Natwest announced back in August that they are trialling a service where customers will be able to bank with their voices, using Google Assistant on their smartphones or Google Home speakers.
With the added trend of increased investment across the sector, it is more than likely that similar innovations will begin to emerge next year.
For businesses and consumers alike, the development of Fintech is set to get even bigger and better in 2024.
With so much innovation at the forefront, business leaders in banking have a responsibility to stay on top of the latest trends, as well as ensuring that their employees are aware of any technology-related changes to their roles or the services the business provides.