In this article, we shall have an insight into the future of the Fintech industry and what successful Fintech ventures might achieve over the next 20 years. What will be Fintech achievements in the future? What everyday services will be completely transformed? If you have ever thought about this, then you’re safe.
As technology continues to thrive in the world, we expect a lot of changes in the financial sector. In the next 20 years, we expect to see digitalization changing how consumers interact with everything. Companies such as Apple, Amazon, Airbnb, Uber, Netflix and others will create more innovative changes across all industries.
Today, UK is dominating the Fintech industry, with her companies making up almost a fifth of the global list. However, UK’s position as a leading Fintech center is not guaranteed. Many Fintech firms will rise in China and Africa. Because this industry is very mouth watering, there will be Fintech boom everywhere and competition will be very high.
In the future, we expect to see losers and winners coming more frequently than ever. Innovation in Fintech will see companies’ growth cycles shortening. Few companies will be able to stay at the top for long. Businesses will have to become increasingly responsive and dynamic to remain competitive.
Currently, Fintech regulation is a key challenge. However, in the next two decades, it will be one of the greatest opportunities in the sector. Regulators will design regulations that work for startups and enable progress based on extracts from numerous data, including feedback from customers, without putting customers at risk.
In order to make a country a global center for Fintech, there is a need to have regulatory regime that supports the interests of businesses and consumers. A careful balance should be struck between innovation, stability and regulation. In the future, many industries will work together to promote Fintech. Regulators, Fintech companies, universities and financial institutions will be working together with the aim of promoting regulation and innovation.
If you think banks will disappear in the next 20 years, you are wrong. Banks will not stand around and wait to be blown out of the water by ApplePay, PayPal, Betterment, Lending Club, Wealthfront, or any person who is trying to steal their customers. Consequently, in the future all the banks will embrace technology and compete favorably with Fintech organisations. There will be greater partnership between Fintech and banks than ever before.
Digital currencies such are Bitcoin will replace the traditional currency. Bitcoin is an online-scale open platform for value exchange with near-free, near-instant international value transfer that requires no central clearing. Bitcoin and other digital currencies will have widespread adoption; therefore, bringing challenges and raising questions around regulation and taxation.
With widespread adoption of Bitcoin, the opportunities in financial service will include: re-architecture of the securities market, programmable money, supply chain finance, and push for payments by design. However, it is important also to acknowledge that Bitcoin will facilitate funding of illicit activities and money laundering (e.g. the Silk Road site used Bitcoin for payments of prostitution and drugs)
Although future predictions are vulnerable to uncertainties, given the current contribution of Fintech to the UK economy, and the opportunities that it presents, it is possible to see a future in which Fintech industry contributes enormously to the world economy by 2040.