Intergiro predicts the Fintech trends in 2023

Fintech has gone from strength to strength this year. The sector has continued to develop rapidly with traditional banking methods now being replaced by digital solutions. So can 2023 welcome the industry’s most dynamic innovations to date? Here we are preparing to enter a whole new world of fintech experiences.

To predict this future is Intergiroa Swedish EMI offering a financial toolkit for fintech innovation.

Its predictions are derived from analysis of Google search trends alongside the company’s own insights.

From tribe-based banking to embedded finance, here’s what the company expects to happen in the coming year.

Despite concerns about how the service could affect credit scores and personal debt, buy now pay later (BNPL) has definitely emerged as one of the defining trends in the fintech industry.

The service allows customers to split their payments at the checkout into typically interest-free installments that are paid back over a timed repayment plan – three months, six months, etc.

BNPL is popular with high value purchases, and providers such as Klarna has even branched out from purely digital services to physical credit cards, which they announced this year.

The physical card enables customers to use the service when shopping in real life, splitting repayments more often.

Intergiro says that by 2023, although it is expected to expand further, BNPL will be increasingly regulated in the UK.

The government will introduce legislation requiring lenders to carry out affordability checks before approving loans.

The financial marketing rules for BNPL are also to be changed to ensure that advertisements are clear and do not mislead consumers.

Searches for the service have increased by 130 percent over the past five years, and have reached their annual peak every December since 2017.

Intergiro predicts that the use of virtual cards will continue to increase in 2023.

The research shows that since 2017, searches for the term “virtual card” have increased by 216 percent, and are now at their peak.

But how are virtual cards used by businesses?

In accordance Nick Rootthe company’s CEO, their continued popularity is due to their ability to offer “more robust security measures, which help eliminate misuse by hackers and fraudsters.”

“They are … reinventing the way companies manage employee business expenses,” Root continues.

“Each employee has their own unique card, which means everyone can easily see who is using what.

“Funds can also be allocated to team budgets and purchases can even be limited so that no one spends more than what is allocated to them.”

Searches for embedded finance have increased by 488 percent since 2017, an interest that will see the technology grow into the next year; says the company.

The success will be mainly due to distribution, trust and improved user experience.

Searches for banking as a service (BaaS) increased by 176 percent in the same period.

BaaS defines an ecosystem where licensed financial institutions offer non-banking companies access to their services, typically through the use of APIs.

BaaS makes it possible for customers to build financial services into their own products or build completely new financial services from scratch.

Use cases vary from issuing virtual cards, creating payment methods in the app and building a neobank, to setting up traditional card programs, white label payment processing or embedding IBAN accounts in multiple currencies.

“The growth of API-led banking means that distribution is no longer an issue,” Root continues.

“That layer of friction has now been removed and any digital company can offer a financial service without the headaches and complexities that providing financial services used to bring.”

• Cryptocurrency will become an everyday way to pay

By 2023, the company expects to see an increasing number of financial institutions accepting cryptocurrency as a form of payment.

MasterCard recently announced that they are keen to start rolling out plans to make crypto an “everyday way to pay.”

Acts as a bridge between crypto trading platform Paxos (used by PayPal) and large banks, Mastercard will handle the major roadblocks, including compliance with regulations and finance.

Google recently announced a collaboration with Coin baseallowing customers to pay for some cloud services with cryptocurrency in early 2023.

“As more and more people invest in cryptocurrency, businesses are starting to adopt it as a form of payment,” explains Root.

With searches for “pay with crypto” up 136 percent since 2017, Root predicts more banks and financial institutions will follow in the footsteps of Google and Mastercard.

The Internet of Things is making waves in the fintech sector, allowing consumers to pay for goods and services with wearable technology.

The apple Watch is a clear example of this, and shows an upward trend in 2022.

Smart rings are another example, with related searches increasing by 180 percent globally.

The company sees wearables as a defining feature of 2023, and a trend that will continue to grow.

It predicts that fintechs will increasingly use these devices to gather insights into their customers.

Despite the term being coined in 2008, regtech-related searches have increased by 184 as of 2017.

Grand View Research predicts a 52 percent growth in the technology market by 2025, giving it a value of $55.28 billion.

The increase in digital products means that there is an increased risk of data breaches, cyber hacks and money laundering; hence the necessity of regtech into the coming year.

Intergiro says artificial intelligence (AI) will continue to drive infrastructure decisions in the fintech sector.

Over the past five years, searches for “AI in banking” have increased by 104 percent globally.

The company predicts that chatbots specifically will become more sophisticated and may soon be the future of fintech customer service.

Studies from Juniper Research suggest that successful banking-related chatbot interactions will grow by 3,150 percent between 2019 and 2023; saves the banks 826 million working hours.

“Digital tribe” describes a digitally connected community that shares a common interest.

By 2023, Intergiro predicts that more businesses will engage with online tribes as a way to form deeper connections with consumers.

It expects more companies to launch their own financial services centered around the tribes they are associated with.

“In the past, people from different communities have been uncomfortable with legacy banks because they have not been represented, not empathized with and not open to communication,” Root added.

“In this new era, banks must be more authentic and receptive to communication. People from these communities will soon be looking for a bank that gives them a sense of representation and transparency.”