The 2024 financial landscape is evolving at an unprecedented pace, influenced by consumers’ relentless appetite for convenience. These FinTech trends are reshaping the responsibilities and expectations placed on CFOs. This post illuminates three emerging financial trends that CFOs need to keep on their radar in 2024.
Table of Contents
1. AI-Driven Personalization Sets New Customer Expectations
Artificial intelligence (AI) continues to revolutionize the FinTech industry by upping the bar for highly personalized services and support, far beyond (already-mainstream) robo-advisors. AI algorithms can analyze consumer behavior and financial data to customize advice on budgeting, saving, and investing, as well as enhance customer experiences:
- ZDNet reports natural language-generation technologies can help interrogate and understand data. Tools like AI-driven chatbots can help customers actually engage when they have a question, problem or complaint.
- Similarly, generative AI tools can provide personalized answers about products and save customers the burden of researching themselves.
- The increased accuracy and prevalence of AI is leading to more efficient and customer-centric services. All told, financial customers will increasingly demand a seamless, end-to-end, and consistent experience.
Further reading on artificial intelligence’s potential in FinTech:
- from ZDNet: AI and data: Honing hyper-personalization to build the bank of the future
- from EY: How embedded finance and AI impact the lending sector
2. Security Is Evolving to Include Biometric Authentication
Are you trading safety for convenience? With the rise in cyber threats, the FinTech industry is adopting more advanced security measures, including biometric authentication. Because they’re much harder to duplicate or steal – and also faster and more user-friendly – technologies like fingerprint scanning, facial recognition, and behavioral biometrics are becoming more prevalent to secure financial transactions and protect sensitive information. What’s more likely? An executive erroneously clicking a malicious authentication link, or a scammer having a copy of the exec’s fingerprint?
>> Related: Four Financial Trends for 2024 and What CFOs Need to Know <<
Adopting biometric authentication can help organizations filter out potential bad actors, bots, and fraudulent identities. And Allied Market Research projected that “the global market for biometrics in banking, valued at $5 billion in 2022, will grow to $23.6 billion by 2032 at a stellar compound annual growth rate (CAGR) of 17.2 percent from 2023 to 2032.” (source)
Further reading on biometric authentication in FinTech:
- from CNET Money: How Safe Are Banking Apps, Really?
- from TechRadar: Battling the beast: How PayPal is turning the tide against online fraud
- from International Banker: Biometrics Are Proving Increasingly Essential for Banking Security
3. Embedded Finance
Expect to see financial services embedded or integrated into consumers’ preferred, non-financial platforms, including e-commerce sites, ride-sharing apps, and social media platforms. Instagram shopping, buy-now-pay-later financing, and one-click payments are all familiar examples. Paying for items and services is the least exciting part of the customer experience, and embedded finance turns that laborious process into something far more convenient.
This trend is making financial services more accessible and convenient by allowing users to perform financial transactions without leaving the platform they’re using. And it’s thanks to the collaboration of banks, technology providers, and financial products. But, according to FinTech Magazine, while “a survey from Airwallex found that although 83% of SMBs are interested in acquiring financial services through their Software as a Service (SaaS) platforms, only 9% currently have access to these services.”
Further reading on embedded finance
- from PYMNTS: Embedded Finance Helps Business Buyers Move Commerce Online
- from FinTech Magazine: Embedded Finance: Transforming Financial Services