Fintech space trends for 2022
Let's be honest- the world is still a very strange place at the moment. Economic recovery from the covid pandemic has forced digital transformation, combined with deeper global market insight. This has resulted in more fintech unicorns than ever.
2021 saw huge open banking adoption, leading to pushback against the blockchain. With Facebook’s announcement of the ‘Metaverse’, the battle is clearly not over.
Alongside this, smart contracts companies such as DragonContracts are continuing to transform the payment industry with more security than ever. New technologies will continue to emerge and grow this multi-billion dollar industry through to 2023.
Hopefully, you'll have your own financial services predictions for the Fintech space in 2022 and you’re ready to take on the year. Now, here are three of ours.
White labeling
White label fintech firms allow their technology to be adopted by competitors in order to reduce cost while offering another channel of revenue. It’s an innovative way to remain high-touch on branding and increase digital asset types without R&D costs.
In the US, the private label market held 19.5% of the entire market share in 2020. Of course, this applies to products across all industries. It’s why ‘dropshipping’ has become such a buzzword in recent years.
However, this data suggests strongly that the white label process is validated and proven, so we are likely to see more widescale applications in the Fintech space in 2022.
While labeling can be a useful strategy for financial institutions looking to scale up their suite of offerings. Often, it is used to complement the core services of your Fintech company as an ‘add-on’ feature. For example, Alviere offers a white-label card service for companies to offer debit cards, rewards, or gift cards customized to their own fintech brand.
At The Search Cure, we work with quite a few clients who use white-label technology from other fintech brands. So we expect to see this growing trend continue into 2022 as embedded finance emerges at the forefront of larger companies that are competing for super app status.
To become a white label brand and create a new channel of revenue; focus on understanding the challenges of your ideal partner and building relationships within the fintech sector. We also tend to see more reliance on demos and testing on this type of fintech products. This is because large-scale clientele requires a holistic customer experience before they jump on in.
Web3 / Metaverse
“Metaverse” is most definitely the buzzword in the Fintech space as we head into the new year. While it has come around a lot sooner than many predicted, we think that 2022 will see a huge adoption of “web3” and emerging markets technology more generally in the industry.
But first, what are “web3” and the “metaverse”?
To answer this question, we must go back to Tim Berners-Lee and the initial creation of the internet. Back in 1989, he built Web1: the first era of the internet- mostly made up of static web pages to consume information. The Web2 transition occurred with the popularity of social media- where the majority of the public became content producers as well as consumers.
Finally, we are approaching the Web3 era: a decentralized concept that integrates blockchain technology so that individuals can own their content on the internet. The secondary aim of this is the reduction of digital financial crime. This is important as we introduce the Metaverse- a facebook-run platform that facilitates a digital economy. Users will typically navigate this new world through virtual reality (VR) technology.
Now to the good bit: why is this important for Fintech companies?
Well, as mentioned, these phrases are currently trending and picking up huge popularity among groups of users on the internet. Everybody wants to be a pioneer: we always hear about those who invested early on in the stock market and made easy fortunes. Many are looking to emulate success this within the next phase of the internet.
We predict the vast adoption of decentralized technology within the fintech space for 2022. Think about NFTs to create exclusive communities that will replace traditional memberships, for example.
It’s important to mention that we think many of these technologies will be published without being perfect- they can be refined later. The focus right now is on creating financial technology that fits into this trend.
Therefore, we are seeing many of our clients devote R&D resources towards developing machine learning tech that fits into this decentralized space.
Data Sharing
Recently, I wrote about how we were seeing a trend towards the acquisition of media companies in the Fintech space. It meant that instead of linking to outside resources or dodgy research, these companies became the source of information. In turn, this increased both credibility and reputation.
Now as we move towards 2022, there are a number of regulatory measures that will be put in place in order to better protect and anonymize data and information in the public domain. For example, the Colorado Privacy Act now requires businesses to focus on consumer rights around the access and treatment of data.
In 2022, we expect to see data collection and treatment processes in Fintech more refined in order to comply with regulatory requirements. Furthermore, this will lead to more original research reports as your Fintech brand attempts to compete and scale in its specified technology sector.
It's a tricky time for Fintech startups, with many struggling to navigate the trends and changes in the space. Thankfully, you can stay in front of the game by continuing to strategise and plan ahead. Schedule a discovery call with me to move your content marketing efforts in the right direction.