Three FinTech Trends to Watch in 2022

Three FinTech Trends to Watch in 2022-01 (1)

As the FinTech industry continues to witness growth at an exponential pace, organizations need to learn and understand the latest trends to keep their momentum. 

Most of the 2020 and 2021 saw organizations battling the challenges due to rapid adoption of digital first technologies. Organizations relying on cloud technologies thereby taking initiatives to abandon legacy systems, embracing remote work as well as devising user-friendly products and services that retained customers during the lockdown are seem to steadily calm down. This rapid adoption of digital platforms has seemed to play in favor of FinTech organizations who are continuously witnessing an explosion both in the customer base and revenue.

With pandemic making it difficult to access traditional financial services, most people turned to virtual ones to keep up the uncertain time. In fact, as per Plaid’s “The Fintech Report 2020”, 59% of all the Americans utilize FinTech applications now than they did prior to the pandemic.

Also Read: How to Prevent Algorithms from Ruling the Workplace

Given the changes happening in the FinTech space, here are the three trends that will shape the financial sector in the upcoming year:

  • Conversation AI, Biases, and Privacy

Clint Lotz
Clint Lotz

Clint Lotz, Founder and President, believes that this is really going to be at the forefront in 2022, especially when it comes to eliminating bias in AI being deployed for lending purposes. She stated, “We have already seen pushback on AI biases from the general public when it comes to facial recognition tech, and I expect the financial industry to see even more pushback against some of the technology that became most pervasive during the height of the COVID lockdowns.”

“In FinTech and beyond, there will be more demands for consumer privacy control, as people are going to want more control over their data. As it is clear to many how there are billions of data points out there (based on daily online interactions people make), FinTech and financial services companies will have to be more mindful of how they use this data and the transparency with their customers, particularly for marketing purposes,” added Clint Lotz. 

  • M&A

The biggest trend that organizations can witness is in FinTech M&A next year as large financial institutions are taking a keen interest in acquiring startups developing FinTech “AI for good” technology. “Racism is systematic, baked into many systems in America and perhaps the most obvious is the world of finance< said Clint Lotz. He added, “To balance things out, PE/M&A companies and banks will target for these hot startups that are getting closer to solve these issues with AI, whether it be discriminatory lending practices, housing, credit, etc.”

Also Read: 4 Strategies to Foster a Sense of Urgency About Digital Transformation

In 2022, FinTech industry will increasingly focus on founders/startups to reach under communities, as FinTech companies will get better at understanding their needs. “The catch is that maybe this will be the year where a FinTech organization not only figures out how to build a product that reaches this market of the underserved population/under-banked, but that is actually profitable in the process, ” added Clint Lotz.

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Vishal Muktewar is a Senior Correspondent at On Dot Media. He reports news that focuses on the latest trends and innovations happening in the B2B industry. An IT engineer by profession, Vishal has worked at Insights Success before joining Ondot. His love for stories has driven him to take up a career in enterprise journalism. He effectively uses his knowledge of technology and flair for writing, for crafting features, articles and interactions for technology enterprise media platforms.