Start-ups are entering everyday life in all industries with innovative products and new ideas. Of course, the financial industry is not exempt from this and young FinTechs are pleased with their growing popularity. Already established FinTech companies such as Paypal, Transferwise, or the digital bank N26 have become an integral part of the industry. For the second half of 2022, the following trends are emerging for the growth market of financial technology:
Cooperation Between Banks and FinTechs
Initially, FinTech start-ups were still ridiculed by large banks. Later, they were ignored or seen as a threat to the market position, obviously, every company has its pros and cons. Meanwhile, almost all major banks cooperate with FinTech start-ups and have set up so-called accelerators. These are mentoring programs in which FinTechs are supported at launch and get access to banks’ technology or contact network. The way banks ultimately integrate fintech development varies from institution to institution. Some financial institutions buy FinTech start-ups, while others establish independent FinTechs under the umbrella of the parent company; direct banks, on the other hand, often rely on cooperation with already established FinTech platforms.
For most people, the smartphone is now an integral part of private life and everyday work. Therefore, it is not surprising that the mobile compatibility of financial products is becoming increasingly important. The demand for user-oriented banking and financial apps is constantly increasing and more and more mobile banks are bringing innovative concepts to the market. In the meantime, other competitors are also pushing their way onto the mobile banking app market, partly with practical concepts for niche markets.
The Dutch mobile bank “Bunq” for example, relies on accounts that can be activated at the push of a button and shared with other users. This service is primarily intended to appeal to couples with a common household or shared flats. Large banks also recognized this trend and quickly launched mobile versions of their own online banking systems to continue retaining their customers.
Social Trading and Crowdfunding
For the first time, the FinTech industry made it possible for private investors to invest transparently together. The trend of investing based on swarm intelligence remains unbroken in 2022. Crowdfunding platforms can look forward to lively growth. The real estate industry has also recently discovered crowdfunding for itself. On a specialized platform, investors get the opportunity to participate directly in real estate projects.
Cryptocurrencies and Blockchain Technology
Virtual currencies received a lot of media attention in 2022, as a once marginal phenomenon has now become accepted means of payment worldwide. Bitcoin first came into circulation in 2009 as an experiment by a group of programmers. The cryptocurrency is based on a database form called Blockchain, through which transactions can be processed quickly, efficiently, and transparently.
The trends mentioned here shaped the first half of 2022 and further development in this direction is likely. This is particularly obvious when looking at the investments of institutional investors in FinTech funds or FinTech incubators.