3 Fintech Predictions for 2023

COO i Adyen.

As worries about an economic downturn mount, the emphasis on brand stickiness becomes more pronounced. What are brands doing to make themselves a must-have rather than a nice-to-have as shoppers begin to consider spending?

Recessions, inexorable in nature, can be unpredictable. When customers – be they individuals or businesses – consider where their money is going, what makes a business stand out compared to the rest? An incomparable customer experience.

Financial technology and payments contribute to CX for individuals by becoming as invisible and seamless as possible, adding value behind the scenes to businesses when used correctly. Here are several key trends as technology continues to be an experiential needle puller as times prove challenging.

New technology creates platform potential.

The year is shaping up to be another big one for platforms, many of which have taken a big step towards converting SMEs into banking customers by introducing built-in financial services.

SMBs, long underserved by traditional banking, have been partnering with platforms for years now. Now platforms will become even more sticky by building in financial products.

How embedded as they are already in users’ daily operations, how much imagination is there to host bank accounts on the same interface or, when the time is right, offer a loan? According to research on the opportunity for embedded financial products, conducted by our company and the Boston Consulting Group, SMEs are showing an increasing openness to obtaining financial services from non-traditional banking entities.

While embedded financial products for SMEs are still in the early stages of adoption, an economic downturn has the potential to encourage this shift away from traditional bank reliance. Given that the addressable revenue opportunity for cash advances, business accounts and card issuance is $110 billion across the US, Europe and the UK, 2023 will be the year when the platforms that get it right are more likely to come out on top.

The devil is in the details for personal experiences.

As with any innovation, once the bar is set, everyone else tries to follow. Personal retail and restaurant experiences are no different. Exhausted as people were from online ordering after the pandemic, the store has made a meaningful comeback into people’s lives.

Shoppers still crave that personal experience, whether it’s before an online purchase or after seeing something online and wanting to see it in person. Research we conducted for our annual Retail Report found that 64% of consumers “say brick-and-mortar stores are an important point of contact, even if they shop at the same retailer online.”

The landscape of personal payments has changed in recent years. Influenced by the emergence of platforms, hardware innovations and general customer impatience, point-of-sale payments for F&B and retail have irrevocably changed and continue to do so as customers demand high-end, seamless experiences.

Whether in large or small environments, indoors or outdoors, once a customer has decided to pay, the experience should be as fast as possible. Smaller, more portable devices are the answer here, and I expect we’ll only see more in the coming years.

And when there’s no need for roaming devices (or indeed people to hold them), I envision more and more self-checkouts outside of grocery and quick-service restaurants, such as at fashion retailers. Customers in a hurry will welcome multiple self-checkouts, with floor staff then freed up to ensure their shopping experience is optimal.

Newer payment methods pave the way for the future of money movement.

A few years ago, I predicted that payment methods would become super apps, as the public continues to take more control over the movement of their money. We see just that. And the driving force behind their adoption? Gen Zers, many of whom defy banking norms by going from unbanked status straight to these apps or digital wallets.

In fact, I envision fewer personal cards in use at checkout. This practice is no more widespread than in Brazil, where the use of the Pix payment method is such that it has surpassed the volume of credit and debit cards in the country.

And in Europe, the Middle East and Africa, where alternatives to traditional banking have been prevalent for years, their growth remains steady, with the latest entry for freer money movement – ​​open banking – also starting to pick up, particularly in the UK

Human trends that continue to drive these changes in how consumers pay and move money are remarkable in that they are not just generational, but circumstantial. With COP27 just wrapping up in Egypt and the emphasis on businesses to act towards the world’s 2030 goals, there will be louder calls from this generation and others for technologies to support and consolidate their future.

Look for more impact, sustainability and purpose-driven products to appear on super apps and more, as they respond to growing calls from customers to actively participate in the conversation, helping when help is most needed.

The Forbes Finance Council is an invitation-only organization for executives in successful accounting, financial planning and wealth management firms. Am I eligible?