Fintech: how it will evolve in 2024

From the now well-trodden track ofartificial intelligence to the extension of Buy Now Pay Later to businesses, without forgetting the more traditional field ofOpen Bankingbiometric payments and new ones ESG trends.
These are some of the developments expected for 2024 Fintech sector according to Qonto, a company in the sector which, with its services, simplifies the daily routine of business transactions.

In the increasingly dynamic and interconnected context of the financial landscape, the Fintech sector presents itself as a now indispensable epicenter of transformation and innovation, which responds to the growing demand for flexible and personalized financial solutions. But let’s see some trends which, in 2024, will redefine how people and businesses manage their finances.

Industry consolidation

One of the most obvious trends, given the high number of operators in the fintech sector, the strong competition and the difficult context in which it operates, is that of consolidation through merger and acquisition operations. But the fintech boom is not over yet: Qonto’s latest report on SMEs reveals that they show a growing interest in digitalisation and Fintech.

The race of artificial intelligence

As in many sectors, artificial intelligence is also having a very important impact on Fintech and will continue to have it in the near future: the adoption of advanced algorithms, machine learning and predictive analytics allow the definition of highly personalized financial services capable of anticipating needs, ensuring better risk management and greater efficiency. Furthermore, the synergy between AI and fintech it is also used in detection and fraud prevention and in chatbotswhich have become instrumental in providing real-time assistance and personalized guidance within fintech applications

Biometric payments

The ever-increasing integration of biometric payments it will revolutionize the financial transaction experience, offering very high levels of safety and comfort. The use of unique physical traits, such as fingerprints, facial recognition, and voiceprint analysis is becoming increasingly widespread, replacing or complementing traditional authentication methods. This trend has the potential not only to simplify the process of payment, but also of strengthen security of transactions.

Buy Now Pay Later extended to businesses

The Buy Now Pay Later (BNPL) practice, now very popular among consumers, could offer notable advantages also for entrepreneurs and SMEs, also in terms of increased sales, thanks to the collaboration between BNPL suppliers and e-commerce platforms. There Global size of the BNPL market was valued at $23.22 billion in 2022 and is expected to grow from $30.38 billion in 2023 to $122.19 billion by 2030with a compound annual growth rate (CAGR) of 22%.

Traditional Open banking

Open banking is a concept already well known in the sector and certainly destined to prosper further in the coming years: this practice, which favors secure data sharing between financial institutions and third-party service providers, has catalyzed important innovations in the sector. 2024 will witness a growing collaboration between financial institutions, Fintechs and regulators to develop standards and protocols che balance innovation with security, allowing the concept of open banking to consolidate itself as a fundamental pillar of the global financial system. In the new PSD3 directive, open banking seems to find new lifeblood in its evolution to the concept of open finance, with the prospect of including a broader picture of financial data that does not just concern access to accounts and transactions carried out.

ESG issues

ESG criteria – Environmental, Social and Governance – sThey have long entered the areas of managed savings, credit policies and commercial development strategies. Attention to sustainability is increasingly central and also pushes Fintech companies to consider not only financial returns, but also the environmental, social and ethical impact of its activities. We will increasingly see the development of innovative solutions and financial products that reflect these criteria, allowing customers and companies to make financial decisions aligned with sustainable values. With this in mind, Qonto announced its Impact Strategy in 2023, which aims to reduce its carbon footprint and create an inclusive workplace through interactive diversity workshops, disability training courses, awareness events and support groups for employees.