When we take a look at the FinTech industry and how it changed over the past decade, we can see alterations and adjustments. FinTech services and technologies have evolved, grown, and changed how the average customer does their business. This only raises the question of what we can expect next. The innovation and changes in the FinTech industry are not going to stop so what are the market predictions?
This article will help you look at the bigger picture. First, we’ll take a quick look at the development of the FinTech industry in the last two decades. Then, we’ll discuss future predictions and what to expect in the upcoming years.
FinTech Trends in the Early 2000s
Let us first take a look at the way things worked back in the early 2000s when digital technologies still haven't developed as profoundly as today and people did things „the old way".
The main difference, when compared to what we have today, is in the importance of banks to the typical consumer. Local or regional brick-and-mortar banks were the ultimate service providers for everything finance related:
- money transfer
- mortgages
- savings
- financial planning
- wealth management
- loans
People weren't focused on finding the best option for their provider of financial services but relied on their local banks as the most obvious and thus convenient choice. Therefore, there was less competition in the market.
FinTech Initial Changes in the Late 2000s
As we go closer to the late 2000s, we can see the initial changes appearing the in the FinTech industry. There were two main reasons:
- the Global Financial Crisis
- technological advancements and the rise of the cloud
The Global Financial Crisis led to an increase in suspicion and mistrust that consumers felt over the banks. Suddenly, everyone was wondering if there was a better way to be handling their money and finances. Additionally, new regulations were introduced in the domain of bank authority and the way they were allowed to operate.
As for the technological advancements, they made room for new solutions that cast a shadow over the typical brick-and-mortar bank. Suddenly, it was affordable to reach out to potential consumers, win them over, and grow your customer base.
All of this led to the blossom of the FinTech industry.
Image taken from Pexels
Rapid Innovation and Growth
During the last decade, we've been witnessing rapid growth in the FinTech industry in almost every domain. The dominating change is in the emergence of small FinTech startups that started to take over. These companies mostly started small and focused on different goals:
- offer the same services as a bank
- innovate and offer something completely new
- developing new products
- entering different market
- growing
It was obvious that the FinTech market is growing and that is the case even today. With new services and advanced technologies, we’re miles away from the experience we as customers had ten or twenty years ago.
But, what can we expect to happen in the next ten or so years?
FinTech Industry Predictions
As we look into the future, we can say one thing for sure- the FinTech industry will continue to grow with the help of startups, fresh ideas, young energy, and technological innovation.
The main emphasis will be on the customer- their needs, problems, ideas, and goals. Startups will focus on predicting or understanding all of the above, and then racing to be the first to offer the ultimate new product or service.
This only means that the investment rate will grow rapidly, as well as the interest of big financial companies to acquire these leading new startups.
We’ll be seeing collaborations and increased activity in all domains of the FinTech industry.
Final Thoughts
The FinTech industry has changed immensely since the beginning of the 21st century, but the growth is nowhere near the end. In fact, it looks like things are just starting to heat up. We’ll be seeing and experiencing serious market competition, as well as innovative services and products emerging regularly.