{"id":11054,"date":"2023-04-17T04:33:03","date_gmt":"2023-04-17T11:33:03","guid":{"rendered":"https:\/\/maccelerator.la\/?p=11054"},"modified":"2025-06-16T19:40:26","modified_gmt":"2025-06-17T02:40:26","slug":"fintech-new-trends-in-innovation","status":"publish","type":"post","link":"https:\/\/maccelerator.la\/en\/blog\/startups\/fintech-new-trends-in-innovation\/","title":{"rendered":"Fintech New Trends in Innovation"},"content":{"rendered":"\n

The current trends of innovation<\/a> in fintech are more advanced and widespread than people realize; artificial intelligence (AI), blockchain, cloud computing, and big data<\/a> make up one of the fastest-growing areas for venture capitalists. All chief innovation officers and corporations should stay updated on the latest trends.<\/p>\n\n\n\n

In the world\u2019s fast-paced, constantly changing automated landscape, financial technology stands out as a sector which has been ahead of the rest. The speed at which it has adopted new innovations puts fintech a step ahead at all times. In this article, we\u2019ll overview innovations such as AI, cloud computing, and more which can aid you in many jobs and keep your startup or company relevant; competition in fintech can be fierce! Plus, the world only seems to be moving faster\u2026<\/p>\n\n\n\n

<\/p>\n\n\n\n

What are new innovations in fintech?<\/strong><\/h2>\n\n\n\n

It all began in 1858, when the first transatlantic cable connected North America and Europe, allowing Queen Elizabeth and President James Buchanan to exchange a few words. Advancements in telecommunication allowed the Federal Reserve to electronically move funds to member banks in 1918. Then in 1950, the first universal credit card, which could be used at a variety of establishments, was offered by the Diner\u2019s Club Inc. <\/p>\n\n\n\n

The world\u2019s first digital stock exchange, NASDAQ, began in 1971. Lastly, the rise of the Internet in the 1990s led to digital banking platforms, giving customers more flexibility to manage their money, and enabling faster invoice payments (C2FO<\/a>).<\/p>\n\n\n\n

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Nowadays, customers have fully embraced on-demand finance as a normalcy, thanks to widespread mobile and cloud computing. One trend is that people are moving to manage their money and business online; people also have less patience to deal with the slow, bureaucratic traditional financial services. <\/p>\n<\/div><\/div>\n\n\n\n

\u201cOverall, the financial technology sector is red-hot, with traditional financial institutions increasing their fintech investments and competing with startups to offer financial services products faster and more efficiently,\u201d Deloitte<\/a> notes. <\/p>\n\n\n\n

This competition is a big reality of fintech at present, and the size of the company doesn\u2019t matter as much as its ability to impact its customers with the service provided. This means that there\u2019s room for startups to compete alongside large corporations. It\u2019s a fast-paced, winner-takes-all environment. <\/p>\n\n\n\n

Another extremely relevant issue is the automation of manual work, a tactic the most strategic,                                                                                                                                                                              groundbreaking companies are adopting. Hyper-automation refers to the introduction of AI, deep learning, event-driven software, Robotic Process Automation (RPA), and other tools that improve decision-making efficiency and automation capabilities in a work setting. (McKinsey<\/a>) While it\u2019s already a major part of digital advancement, fintech will only continue to expand its boundaries in the future. <\/p>\n\n\n\n

The main function of RPA is to automate and standardize business functions by assigning them to robots. They can easily handle workflow information and business interactions, and they do so with a high level of repeatability, stability, and clear logic, making it appealing to use. <\/p>\n\n\n\n

In fintech, RPA will become increasingly integrated with artificial intelligence, improving its ability to work through complex business scenarios and streamlining those financial services. (McKinsey<\/a>) Obviously, these new movements in the fintech world will have lasting impacts on the industry and people\u2019s lives in the foreseeable future. A new era of trust in finance is also here, alongside the IoT\u2019s coming of age. <\/p>\n\n\n\n

Financial IoT (Internet of Things) systems are composed of three layers. Wireless communication and IoT communication solutions are expanding, allowing more devices to more easily communicate across \u201cwired and wireless networks, near-field communication solutions, low-power wide area networks, narrow-band IoT, connected end-point devices, and centralized control management,\u201d according to McKinsey<\/a>. <\/p>\n\n\n\n

There is a ton of untapped potential on the sensor front, to automate item identification, and manage logistics. Finally, the quick development of smart technologies and embedded systems (even Alexa and Siri) is allowing for intelligent communication with objects on a massive scale<\/a>; it makes it more accessible at a lower price, too. We trust digital methods to help us with finance and other daily tasks, so they\u2019re beginning to show up in a lot of people\u2019s lives.<\/p>\n\n\n\n

Moreover, another example of a current trend in fintech making is the lower barriers to entry. One issue that has always come along with digital advancements is the barriers for smaller companies or individuals. Open source, SaaS, and serverless technologies are already lowering those barriers, becoming key tools for traditional financial institutions and startups alike launching new fintech businesses. <\/p>\n\n\n\n

Amid the intense competition and winner-takes-all dynamics of the digital economy, open-source software, software-as-a-service, and serverless architecture are must-haves for speed and scalability. Any new business or financial innovation has the potential to benefit from these countless new technologies. (McKinsey<\/a>)<\/p>\n\n\n\n

Founders or companies looking to scale should seriously look into open-source and no-code software. The free-to-use source code of open source allows developers to get a jump start on programming their own apps. Low-code and no-code development platforms (NCDPs) allow users to develop applications through logical graphics, configurations, and interface interactions; for example, a drag-and-drop function. <\/p>\n\n\n\n

While still not fully developed, these platforms are already reducing the need to hire software talent, which can be scarce and expensive. Instead of the inaccessible methods of traditional computer programming, this technology is much more available to companies and individuals alike, which is already changing the face of fintech, business, and the digital world. There are many factors pushing the current trends in fintech; replacing manual work with automation can improve accuracy, and efficiency, and allow for more flexibility.<\/p>\n\n\n\n

<\/p>\n\n\n\n

\"What<\/figure>\n\n\n\n

What is driving the trends of innovation in Fintech<\/strong><\/h2>\n\n\n\n

\u201cThe global fintech market is expected to reach $681.6 billion by 2028, with industry experts predicting significant growth<\/a> in virtual cards, embedded finance, and alternative financing decisions,\u201d as C2FO<\/a> informs.<\/p>\n\n\n\n

The current trends of innovation in fintech are driven by a combination of technological advancements and the wish to make business operations more smooth, secure, or uniform. Robotic Process Animation is well-established amongst the greatest in the financial industry, and it\u2019s expected to reach even deeper throughout the sector and beyond. Countless benefits can be derived from the trend toward automation and more open-source applications. <\/p>\n\n\n\n

Automation increases efficiency while reducing human errors and allowing businesses to respond to fluctuations in demand. For example, accounts payable processes have the potential to be automated 60 percent by robots designed to perform as humans for basic paperwork and decision-making. (McKinsey<\/a>)<\/p>\n\n\n\n

Right now, banks and other financial institutions are being tipped to adopt an AI-first mindset that protects them from other expanding technology firms. Artificial intelligence can generate up to a whopping $1 trillion in additional value for the global banking industry annually. <\/p>\n\n\n\n

Some key pieces in financial services include knowledge graphs and graph computing. Their ability to assist in creating associations and identifying patterns across complex networks, while including a wide range of data sources, will have long-lasting implications. Automatic factor discovery (machine-based identification of elements that encourage outperformance) will also play a larger role, helping to hone financial modeling. (McKinsey<\/a>)<\/p>\n\n\n\n

Certainly with all of the news of automation, AI, and decentralized entities, you have caught wind of Blockchain. This new technology is set to disrupt established financial protocols. Distributed Ledger Technology (DLT) allows the recording and sharing of data across multiple data stores, and for transactions and data to be recorded, shared, and synchronized across a distributed network of participants at the same time (McKinsey<\/a>). <\/p>\n\n\n\n

Some DTLs use blockchains to store and transmit their data; they also use cryptographic and algorithmic methods to record and synchronize the data immutably in the network. Decentralized finance (DeFi) is another new method that can replace intermediaries. Through these avenues, people can obtain loans, make investments, or trade financial products all outside the umbrella of centralized management. DeFi uses deterministic (always valid) smart contracts, which eliminate risks of third parties, cut out the cost associated with intermediaries, and improve market efficiency by providing real-time transparency.<\/p>\n\n\n\n

Cloud computing is another moving piece that will liberate financial services players. Instead of keeping data, pictures, etc. on a personal, individual server, those data points are kept in the cloud, a network of remote servers. By 2030, cloud technology will account for an EBITDA (earnings before interest, tax, depreciation, and amortization) in excess of $1 trillion across the world\u2019s top 500 companies. <\/p>\n\n\n\n

When utilized effectively, the cloud can increase the efficiency of migrated app development and maintenance by 38 percent; raise infrastructure cost efficiency by 29 percent; reduce migrated applications\u2019 downtime by 57% and in turn lower costs due to technical violations by 26 percent. (McKinsey<\/a>) <\/p>\n\n\n\n

Three major forms of cloud services exist that financial institutions should be aware of: public, hybrid, and private. The public cloud entails infrastructure that is owned by cloud computing service providers, who then sell the services to organizations or the public. A hybrid cloud is composed of two or more types of cloud that are maintained independently, and connected by proprietary technology. A private cloud just means that the infrastructure is built for an individual customer\u2019s exclusive use. Private cloud service is deployable from the company data centers or other host facilities.<\/p>\n\n\n\n

Essentially, these trends of automation, cloud computing, and no-code applications, among others, are a result of society\u2019s shift towards an internet-based financial world. Everything is going digital, and it\u2019s because automation can facilitate our lives. It reduces human error, allows people to participate in banking\/commerce wherever and whenever they want, and allows financial interactions to happen in a decentralized place.<\/p>\n\n\n\n

\"What<\/figure>\n\n\n\n

What do these trends mean for technologist executives and startup founders?<\/strong><\/h2>\n\n\n\n

With so many innovative trends emerging in the world, let alone the fintech space, it\u2019s hard to know which path is best. That\u2019s why we have outlined the most important factors for startup founders and technologist executives to take into account when planning their companies\u2019 strategies for the future. <\/p>\n\n\n\n

Automation, cloud, and low-code systems are the way the world is moving, with no sign of slowing down; in the Asia Pacific, the fintech market in this region is expected to hit $72 billion next year, according to BBC. As the scene has evolved from niche players into a major industry itself, the fintech trend has changed from new disruptive businesses to a place where fintech and companies work together to deliver state-of-the-art experiences. Any executive or startup founder should be tuned into these technologies and changes, in order to stay relevant.<\/p>\n\n\n\n

Startups have a little regulatory leeway, but they can only go so far alone with their own platforms. Partnerships and industry alliances are a fintech trend that can help bring new technologies to more places. This helps work out implementation problems and helps the technology mature faster. Reaching out to other companies and finding areas to work on together can improve both customer relationships and user experience. One of the quickest ways to understand customer needs and see implementation gaps is to work together with other companies or startups. (Deloitte<\/a>)<\/p>\n\n\n\n

One goal of many directors involved in fintech is to ease the process of accepting payments. It can be a surprisingly complex task! Different payment methods, technical systems, and preferences, all add to the complexity of payments in the internet-driven economy. As a result, new players and established entities are all making an effort to streamline payments. \u201cStripe Connect is one example. <\/p>\n\n\n\n

Connect offers multi-sided marketplaces and platform companies the ability to accept payments from anywhere in the world, and settle payments with sellers and service providers in more than 25 countries in over 135 currencies.\u201d (BBC<\/a>) These plug-and-pay methods are becoming increasingly popular as people grow accustomed to ways of paying that involve more internet. It allows more people to be connected and make payments easily throughout many countries. This ease of payment becomes even more important in our increasingly connected society and economy.<\/p>\n\n\n\n

Furthermore, acquiring new customers is said to be five times more expensive than retaining existing ones, yet building customer loyalty is not an effortless task. How can executives use new trends in fintech to tackle big problems like this one? Perx is just one solution taking on the customer loyalty question. <\/p>\n\n\n\n

The Singapore-based loyalty and customer engagement SaaS platform is powered by machine learning<\/a> and analyzes data from the company\u2019s marketing campaigns in real-time. It provides insights into the effectiveness of campaigns, breaks it down into spending vs return, and presents large volumes of raw data with solutions. Tools such as Perx can help your company see its weak and strong points, and give your ideas to adjust accordingly. Leverage your customers\u2019 loyalty so you don\u2019t have to always be looking for new ones.<\/p>\n\n\n\n

What\u2019s another way automation can make your life easier? Managing payroll can be a tedious, time-consuming process, especially when dealing with sales commissions, annual bonuses, and regulations in different countries. When following a DIY approach, this process is prone to human error; plus, it\u2019s much more complex and time-consuming than when the same process is automated. <\/p>\n\n\n\n

Cloud-based payroll solutions have been available for years and were often tailored to specific countries or regulatory environments. Cloud-based solutions have been helping non-experts run their businesses smoothly for some time, but current solutions are in the works that will have functionality spanning other tasks such as employee records, leave applications, and expense claims. (BBC<\/a>) <\/p>\n\n\n\n

Alternative financing is just another example of when decentralized banking is useful. Peer-to-peer lending typically refers to digital marketplaces through which companies or individuals can borrow money; it\u2019s provided by someone(an organization or individual) to their peers. P2P loans are often not secure, meaning that the borrower does not require any capital, and the borrower\u2019s credit doesn\u2019t make as much of a difference as when doing business with a traditional bank. Fintech can be made so much more streamlined and less bureaucratic through these new innovations.<\/p>\n\n\n\n

<\/p>\n\n\n\n

\"What<\/figure>\n\n\n\n

How are financial regulatory bodies responding to the developments in technology?<\/strong><\/h2>\n\n\n\n

As is the case when any new technology is invented, concerned parties are on high alert to see where things go. U.S. regulators are actively watching, but giving some space for the big players to fall into place. One major challenge with innovation is balancing the risk<\/a> and the controls. <\/p>\n\n\n\n

Right now, we find ourselves in the initial observer phase; guidance is minimal at this point. Fintech and other emerging disruptive technologies spark talk and excitement, but this also means an inherent change to existing architecture and methods. Also with new innovation comes the emergence of new challenges. However, since we are at the beginning stages of this era of widespread financial technology, financial regulatory bodies are waiting to see what happens before making moves (Deloitte<\/a>)<\/p>\n\n\n\n

<\/p>\n\n\n\n

Who are some key players in the Fintech space?<\/strong><\/h2>\n\n\n\n

It\u2019s estimated that startups could capture up to $4.7 trillion in annual revenue and $470 billion in profit from established financial services companies, according to a March 2015 Goldman Sachs equity<\/a> research report (Deloitte<\/a>). <\/p>\n\n\n\n

While there are countless key players already making themselves known in the fintech space, Blockchain presents itself as a great case study. Its distributed ledger technology (DLT) allows startups to create innovative new products or services. What\u2019s cool about Blockchain is that it eliminates the need for a central intermediary to do asset<\/a> transfers, which aren\u2019t limited to money. Asset transfers can be for titles, vehicles, home sales, etc. and Blockchain creates efficiency. <\/p>\n\n\n\n

Typically, payment transactions use several steps to authenticate the person, transfer the transaction details, and settle. Settlements can take up to three days. Blockchain is quick because it compresses the steps into one and completes it quickly. (Deloitte<\/a>) <\/p>\n\n\n\n

Another benefit of using Blockchain is the creation of an audit trail. Blockchain relies on a distributed database, where the information is duplicated on each copy of the database, and all the data is public. Because it\u2019s immutable, you can go into the blockchain ledger, and prove the transaction occurred. <\/p>\n\n\n\n

You can be assured that the record hasn\u2019t been modified or corrupted as long as it lives on the distributed ledger. As a result, there are many financial services industry sectors that can drive performance by using this technology to increase transaction speed and transparency. (Deloitte<\/a>) <\/p>\n\n\n\n

Evidently, Blockchain is just one example of a big fintech player, but it gives you an idea of some ways that current innovations can help solve issues in financial services. From cloud computing, which allows for easy banking anywhere, to AI, which can reduce human error and increase productivity, to no-code app generation, which allows for non-experts to create and expand their startups\u2026 Fintech is upon us, and the innovations are astounding!<\/p>\n","protected":false},"excerpt":{"rendered":"

The current trends of innovation in fintech are more advanced and widespread than people realize.<\/p>\n","protected":false},"author":14,"featured_media":11055,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1251],"tags":[1375],"class_list":["post-11054","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-startups","tag-fintech"],"_links":{"self":[{"href":"https:\/\/maccelerator.la\/en\/wp-json\/wp\/v2\/posts\/11054","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/maccelerator.la\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/maccelerator.la\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/maccelerator.la\/en\/wp-json\/wp\/v2\/users\/14"}],"replies":[{"embeddable":true,"href":"https:\/\/maccelerator.la\/en\/wp-json\/wp\/v2\/comments?post=11054"}],"version-history":[{"count":0,"href":"https:\/\/maccelerator.la\/en\/wp-json\/wp\/v2\/posts\/11054\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/maccelerator.la\/en\/wp-json\/wp\/v2\/media\/11055"}],"wp:attachment":[{"href":"https:\/\/maccelerator.la\/en\/wp-json\/wp\/v2\/media?parent=11054"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/maccelerator.la\/en\/wp-json\/wp\/v2\/categories?post=11054"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/maccelerator.la\/en\/wp-json\/wp\/v2\/tags?post=11054"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}