The global fintech market is growing at a tremendous rate even as the adoption of technologies is on the rise. Look at it this way. Currently, Fortune Business Insights speculates that the market size will grow from $340.1 billion in 2024 to $1.152 trillion in 2032. The speculation factors in a CAGR of 16.5%. Now, this market will grow to the aforementioned size majorly because of the advancements that are being adopted.
But someone would ask, what advancements are these? What trends are currently running the show in this market? If you are one of the people having such questions, then you are definitely in the right place.
Cryptocurrencies and blockchain
If ever there was a trend that became popular because of security and transaction cost, then this is it. The use of cryptocurrencies like Bitcoin have become a common since they have low transaction costs and are almost instantaneous. Again, Bitcoin and other crypto coins are instrumental when it comes to cross-border payments. You can be able to transfer funds to people who do not have easy access to banks or other financial services.
Unlike traditional bank transfers, where you can wait for almost a whole week before an international transaction is complete, with Bitcoin, it is just in a matter of minutes, if not seconds. Again, you do not need to use intermediaries, which increases the transaction cost since transactions are from wallet to wallet. Everything has just become so easy.
Actually, the integration of blockchain technology to the financial sector has the ability to reduce banks’ infrastructure by a whopping 30%. According to a report by Accenture, this is almost $10 billion that is saved. What a life hack.
Decentralized finance (DeFi)
Decentralized finance represents a grand move that the financial system is taking to ensure openness, transparency and inclusivity. Well, Fortune Business Insights projects the DeFi market to grow at a CAGR of 28.2% between 2023 and 2030. This will grow the market size form $59.26b to $337,04b. Well, let’s forget about the DeFi market and focus on how it allows financial inclusivity.
This technology particularly operates on the Ethereum blockchain and it aims to recreate and improve lending, borrowing, trading and investing. DeFi platforms break down traditional finance barriers by giving access to anyone who has a crypto wallet and has a good internet connection. To add on, majority of the DeFi protocols have interoperability which allow users to have combined services and also create complex financial products.
Open banking and APIs
Open banking is perhaps one of the biggest trends in the banking sector that is seeing massive support in 2024. In fact, over 11% (1 out of 9) of people in the UK are active users of open banking. Actually, the number of payments made through open banking systems, as recoded by OBL, in the UK hit an all-time high of 14.5 million in January 2024. This is a 69% year-on-year growth. Needless to say, there are more than 100 billion APIs in access today, globally.
With open banking, third party financial services are able to access the financial details and consumer transactions of their clients from their financial service providers using APIs. This actually ensures that there is more transparency, which in turn allow customers to have more control over their financial information. Basically, if you are working with such a system, you are able to integrate your bank with various finance and accounting tools.
Take this as an example. Santander UK has teamed up with Token.io for their open banking system. Santander aims to enhance its payment offerings and come up with new real-time payment solutions. This move not only increases the competitiveness of the financial institution but also drives long-term growth. In fact, according to Capgemini’s World Payments Report 2025, open payments and instant payments could potentially counter up to 15–25% of the projected rise in card transaction volume.
Green banking
Its true that the world has been on a rampage of trying to reduce the ecological footprints of different industries and promote sustainability. Well, the banking sector has not been left behind. In fact, financial institutions have started doing things that will ensure minimum damage to the environment. For instance, banks have started encouraging paperless banking by initiating processes like online banking, mobile banking apps, and digital banking services.
Well, a good example we can look at is banks in India. India, being the fastest-growing large economy in the world, is embracing green banking. Actually, the Union Bank of India has already declared its commitment to address climate change. Other banks that are also on this route include ICICI Bank, HDFC Bank and Axis Bank, among many more.
In conclusion
Well, the growing global financial sector has been calling forth innovations and advancements that are definitely going to take it to a whole new level. Actually, the different trends that have been rising up in 2024 and even before are clearly showing that the fintech world is ready to revolutionize the world like never before. Without a doubt, the incorporation of different trends like blockchain, green banking, open banking, and DeFi platforms is surely something to be reckoned with.
