It’s a time of reflection and anticipation at The Fintech Times this month, as we look back at developments and trends over the last 12 months and forward to the year ahead.
We’ve once again reached out to our community of fintech CEOs and industry leaders to gauge their thoughts on this year’s major trends as what they expect to be top of the agenda in 2024.
2023 will no doubt be remembered as the year of generative AI. After OpenAI unleashed ChatGPT in November 2022, it has now become the world’s most popular chatbot with more than 180 million users.
Ninety-three per cent of fintechs believe that gen AI will continue to ‘revolutionise the fintech and financial services sector, according to research by the Gillmore Centre for Financial Technology.
Its report, polled via independent polling agency Censuswide, surveyed 250 senior decision makers at UK financial institutions and banks to measure how they felt about the current state of artificial intelligence (AI) and its widespread use.
The study reveals that the majority (91 per cent) also foresee Gen AI playing a pivotal role in driving financial democratisation, bringing with it a new era of accessibility and inclusivity.
Organisations across various sectors, from customer operations to software development, sales, marketing, and research and development, have eagerly adopted GenAI tools to enhance productivity and outcomes. McKinsey Global Institute estimates that these efforts could contribute as much as $2.6trillion to $4.4trillion annually to the global economy.
Another significant development in 2023 was the implementation of the Financial Conduct Authority‘s Consumer Duty in July. This marked a substantial shift in regulatory expectations and burdens for firms within its scope, emphasising a commitment to consumer protection.
With Consumer Duty now implemented, banks must not only emphasise customer prioritisation and trust-building but also prepare to report on crucial areas.
KPMG‘s quarterly Global Analysis of FinTech Funding Reports have painted a complex picture. The first half of the year presented its share of hurdles, including soaring inflation, rising interest rates, geopolitical unrest, sluggish valuations and a dearth of exits. Yet, amid the turbulence, the Americas have stood tall, witnessing fintech funding surge from $28.9billion in H2 2022 to a robust $36billion in H1 2023.
Logistics and supply chain-focused fintech soared to funding heights previously unseen, amassing $8.2billion. Meanwhile, ESG-focused fintech secured $1.7billion, surpassing the figures for the entire year of 2022.
Challenges persist, but fintech remains resilient. While fintech activity may remain subdued, payments, insurtech and wealthtech are poised for sustained and, possibly, accelerated funding. AI will remain in the spotlight.
Visit The Fintech Times website throughout December as we share your 2023 ‘Views from the Top’.