Top banking trends to watch out for in 2023

Another new year gives us another opportunity to predict what fintech has in store – and this time it’s specifically the future of banking. Henrik Rosvall, CEO and co-founder of Dreams Technology, gives us his prediction on the banking trends to watch out for.

The cost of living crisis will cause the banks to renew their digital banking offer

To say that 2022 has been a turbulent year is an understatement. While the energy crisis has fueled high levels of inflation, causing people around the world to face higher living costs, banks are now preparing for even tougher economic conditions and a possible global recession in 2023.

This has created a real need for banks to further digitize their channels and deliver new financial services that are more effective in helping customers cope with ongoing inflationary pressures. As these macroeconomic realities intensify over the coming months, we’re likely to see a greater number of banks pull the plug on their legacy, data-driven PFM solutions in favor of more sophisticated tools backed by science that actively encourage users toward a healthier economy. habits.

In 2023, the ability to anticipate evolving customer needs, and in turn design user experiences that effectively drive human behavior and promote financial well-being, will set forward-thinking banks apart from their rivals.

The B2B fintech sector will boom as third-party collaborations multiply

Ever since the pandemic started, banks have been forced to accelerate their digital transformation processes. While many have found that building their own digital solutions is not only time-consuming, but also extremely expensive, there have been several regulatory changes in third-party policies that have come into place in recent years, enabling a plethora of partnership opportunities between banks and fintechs .

As we move into 2023, the circumstances caused by the cost of living crisis will put even more pressure on financial institutions to further digitize their services and meet the changing needs and wants of consumers. Consequently, the number of banks cooperating with third-party providers will increase drastically, which means that the level of growth and investment in the B2B fintech space will reach new heights.

In addition, B2B business models are more sheltered from market volatility than their B2C counterparts, and less vulnerable to rising inflation and interest rates. As the overall decline in spending continues to worsen in 2023, we can expect loan requirements to fall and defaults to increase, which will further help make B2B fintechs an attractive proposition, both for financial institutions and the investment community.

The green banking movement is gaining momentum as banks seek new tools to help address their ESG goals more holistically

The green banking movement has gained a lot of momentum recently, with many banks already committing to achieving net zero carbon emissions. To fulfill this commitment, banks are beginning to explore how they can address their ESG goals in a more holistic way, which not only spans their own operations but also supports their customers’ own decarbonisation efforts.

With this in mind, in 2023 many banks will move beyond the traditional green financial products that have dominated the market in recent years, such as carbon footprint calculators, and instead implement solutions that are less data-focused and more effective in helping consumers adopt sustainable ways of living and reducing their carbon footprint.

Discussions are still ongoing in Brussels around the standardization and introduction of scope 4 as a way to influence the ESG area and drastically accelerate the transition to net zero. Whether it plays into 2023 remains to be seen. What is certain, however, is that concerns about climate change will not go away and the ESG agenda will only grow from strength to strength. The banks that truly stand out in 2023 will articulate a clear vision to play a positive role in the lives of their customers, while improving their overall financial well-being and driving sustainable behavioral change.

About the author: Henrik Rosvall is the CEO and co-founder of Dreams Technology, a financial wellness platform that uses behavioral science to help users make smarter financial decisions and take control of their personal finances. He is based in Stockholm, Sweden.