The financial technology sector has been experiencing a boom in recent years as the next generation of tech-savvy consumers of financial services are starting to choose banking apps over visiting branches, are investing in cryptocurrencies instead of buying stocks, and are applying for loans on peer-to-peer lending platforms instead of at their banks.

Consumer demand-driven innovation in the fintech sector has led to a change in how individuals and businesses interact with financial services. This can be witnessed by the fintech sector’s hottest current trends, which include an increased push for more mobile-based services, the adoption of artificial intelligence (AI) technology, the implementation of biometric security, and a move towards more cloud computing.

Going Mobile

It is no surprise that consumers are increasingly choosing smartphone apps to manage their personal finances given how glued today’s society is to their mobile phones. This is clearly reflected in the use of banking apps versus visiting physical bank branches, which mobile banking startups have been able to capitalize on.

According to the Millennial Disruption Index survey, 53 percent of millennials do not perceive their bank to be offering anything different than other banks. This means switching from a high street bank to a more user-friendly and customer-focused mobile banking app is not a difficult choice for many. In fact, one out of every three millennials is willing to switch banks, the survey found.

Moreover, consumers are not just using their phones to check their account balances and to pay bills. Payments is another area within fintech that is going mobile fast. In 2017, around one in four of adult smartphone users in the US will use a payment app at once a month or more according to eMarketer. Point of sale (POS) payment apps such as Apple Pay, Android Pay, and similar solutions will experience an increase in users and transaction volumes. In three years time, eMarketer expects one in three US adult smartphone users to use these types of mobile payment applications.

The “everything is going mobile” trend is poised to continue as consumers are already used to managing their lives on their smartphones and will, therefore, likely embrace mobile payments and banking in the future.

Artificial Intelligence (AI)

Artificial Intelligence (AI) is one of the hottest new technologies that is being implemented by fintech startups as well as established financial institutions. Advancements in AI technology have given birth to intelligent chatbots that can respond to simple customer service queries or provide 24/7 financial assistance without human supervision.

Moreover, there are several other use cases where AI is being deployed within financial services including automated fraud detection algorithms, discovering anti-money laundering patterns, and fully-automated financial trading, among others.

A PWC study found that 30 percent of large financial institutions are investing in artificial intelligence. Furthermore, fintech startups that focus on AI technology have raised over $1 billion in venture capital in the last two years, suggesting that AI will be here to stay in the financial services industry of tomorrow.

Biometric Security

As cyber security is becoming an increasingly important challenge for companies as well as individuals new security measures are being implemented to secure financial information. The most prominent new security features that fintech startups and established banking institutions are betting on is biometric security.

Digital identification through fingerprints is the first step in biometric security. Facial recognition and voice recognition using smartphones is the next step in beefing up cyber security. Iris scanning is also an alternative that biometric security startups are focusing on.

In light of the sharp increase in cyber crime and data breaches in the last two years, passwords and two-factor authentication are no longer considered secure enough to protect financial data. Hence, the move towards biometric scanning, which is already commonly used by government agencies as security measures, is a trend that will likely continue to grow in the financial technology sector.

Moving to the Cloud

Currently, over 95 percent of businesses use cloud computing services in some form or another according to the latest State of the Cloud Report by RightScale. Fintech startups are also fans of the cloud and the benefits they can derive from it.

A broad range of fintech startups are utilizing cloud computing services to both build and run their businesses. Through pay-as-you-use cloud computing services, small companies can remove the high cost of building a large technological infrastructure to deliver their product or service to their customers. Furthermore, it allows startups to scale faster as they can adjust the amount of tech infrastructure they need in line with their funding constraints and customer demand.

Cloud computing can give new disruptive fintech companies a leg up on banks as banks usually rely on expensive in-house legacy systems, tight regulatory scrutiny, and suffer from a lack of agility that companies need to adapt to changes in the market or consumer demand.

Cloud computing has moved past simply storing data on the cloud. Now, you can outsource a company’s entire IT infrastructure to cloud-based services, which can give fintech startups the boost they need to compete with big banking.

There is no doubt in anyone’s mind that financial technology will disrupt the banking and finance landscape. Retail banking and payments will continue to go mobile, artificial intelligence will eventually replace human investment advisors and traders, biometric security will replace passwords and companies will outsource their IT to the cloud are the four trends that will likely play key roles in the transformation of the financial services industry going forward.

Banks and other large financial institutions will have to either incorporate many of these new technologies themselves or acquire leading fintech startups who provide these technologies and services to be able to compete with the growing threat of innovative fintech startups that are providing new and improved financial services to today’s consumer.



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Whilst having spent a lot of his life in Asia, John DeCleene has lived and studied all over the world - including spells in Hong Kong, Mexico, The U.S. and China. He graduated with a BA in Political Science from Tulane University in 2016. Fluent in English and proficient in Mandarin and Spanish, he can communicate and connect with most of the world’s population too, and this certainly helped John as he gained work experience interning for the U.S.-Taiwan Business counsel in Washington D.C. as an investment analyst and then working alongside U.S. Senator Robert P. Casey of Pennsylvania as a legislative intern. He subsequently worked as a business analyst for a mutual fund in Singapore, where his passion for travel and aptitude for creating connections between opportunities and ideas was the perfect intersection of natural ability and experience, spending his time travelling between Cambodia, Hong Kong, and China investigating and discovering untapped investment opportunities. John is a fund manager for OCIM’s fintech fund, and currently progressing towards becoming a CFA charter holder. He loves to travel for business and pleasure, having visited 38 countries (including North Korea); he represents the new breed of global citizen for the 21st century.