Fintech’s popularity and investment grew in many countries during 2021. Its reach has expanded beyond its original definition. This broadening scope combined with growing maturity in a number fintech subsectors, increased investment in less mature jurisdictions and rising corporate interest is expected to keep investment high going into 2022. These are the top fintech banking trends for the global fintech market in 2022.
1. An increasing number of banks will offer embedded solutions
Embedded financing has been a growing trend for the past year. This trend is poised to grow further as banks look to be service providers to other non-bank financial institutions.
2. The regulation of embedded finance offerings will increase.
Increased use of financial products or services delivered by entities not regulated will drive regulators to be more vigilant and proactive over the next six to twelve months.
3. Fintechs will work to be known as data organizations.
Many fintechs are likely to reinvent themselves as data organizations and providers of financial services, in order to distinguish their businesses from other companies and investors.
4. ESG-focused fintechs will see significant growth
There will likely to be an increase in interest in fintechs with ESG capabilities due to increasing prioritization of ESG. This includes companies that focus on climate change, carbonization, and the circular economics.
5. It will be easier to make deals in less developed regions.
Investors will be more aggressive in their pursuit of countries that are considered underdeveloped in terms financial services. They will make more deals in Africa, Southeast Asia, Latin America and the Middle East.
6. The Unicorn status in developed markets will be less lustrous, but it will still be important in emerging markets
The rise in unicorns, especially in the US will make it less attractive for companies in developed economies. However, it will continue to be an important building block in emerging markets and for fintech hubs that are less mature.
