Skip to content

Fintech in 2024: A look ahead at the top trends

Despite a challenging 2023 for fintech, with funding slowdowns, valuation haircuts and an economic downturn, we're all poised to enter 2024 with fresh perspectives and new ways to tackle what's to come.

Top trends Top trends

Before we go full-steam ahead, here are our top fintech predictions for 2024.

What are the top fintech trends to watch in 2024?

Generative AI’s inception was a phenomenal moment for the world, as it paved the way for a new era of business and consumer products.

Artificial intelligence (AI) research began in the 1950s, but it has only been in recent years that AI has become sophisticated enough to have a significant impact on the world. Generative AI is a particularly new type of AI, and it is only just now beginning to be used to develop real-world products and services. However, it’s rapidly improving and becoming more integrated within end-user experiences. 


AI is just one of the most exciting trends to look out for in 2024. Along with it are innovations in payment rails, cybersecurity, blockchain and the changing regulatory requirements that come with them.  Let's take a closer look at each of these trends.


1. Artificial Intelligence (AI) and Machine Learning (ML) in Fintech

The AI-powered digital era is here and it’s changing the way we work and how products are benchmarked against each other. We’ve seen over half of fintech companies now using AI to deliver new products and services as key differentiators. 


Now with models making it easier and cheaper to integrate AI capabilities within digital products, we will see more banks and fintech companies double down on AI initiatives in hopes to release products that will bring incremental revenue. 

We will see a wider range of AI applications in 2024, including creditworthiness assessment, robo-advisory services, algorithmic trading, and risk evaluation and management not only in banking but also in fintech. This trend will not only set digital products apart but also enhance the overall user experience raising the bar for business and consumer products.

Moreover, we will see AI lead a new company culture of an 80/20 rule to deliver innovations faster and solve workforce challenges by leveraging a small and nimble team, now that talent acquisition becomes more challenging and expensive. 


2. A more convenient and cost-effective use of stablecoins 

Stablecoins have traditionally served as trading capital and settlement tools for traders. However, in recent years, we've witnessed an increasing acceptance of stablecoins in the business sector through innovative fintech companies offering simpler and faster ways to convert into fiat currencies leading to increased adoption with money transfer services now offering stablecoins for cross-border transfers.

We’re also looking at a checkout experience that is more diverse than ever as we see more and more companies now accepting stablecoins as a method of payment.


3. Green banking and sustainable finance

Fintech and banks are now responding to the need for more sustainable financial solutions. The European Commission's Corporate Sustainability Reporting directive is requiring banks and insurance companies to disclose more information about how they operate and deal with environmental change. This is a positive step, as it will help customers make more informed choices about the financial institutions they support.

Some fintech and banks are already ahead of the curve in terms of sustainability with a number of Neobanks and payment providers all have made commitments to ESG disclosure and are creating more environmentally conscious financial products and services.

One way that fintech and banks are making finance more sustainable is by promoting digital payment solutions. Digital payments are more eco-friendly than traditional payment methods, such as cash and credit cards. For example, digital payments do not require the production of physical cards or the use of paper receipts.

Another way that fintech and banks are making finance more sustainable is by reducing their own environmental impact. For example, some banks are committing to becoming carbon neutral and reducing their waste.

These trends are likely to have a positive impact on customers' buying decisions. As more and more customers become aware of the importance of sustainability, they are more likely to choose financial institutions that are committed to social and environmental responsibility.


4. The shift of revenue models to SaaS 

With the interchange erosion reducing the amount of interchange fees fintech companies are able to earn, the shift towards new revenue models particularly Software as a Service (SaaS) model from traditional software distribution in fintech is on the rise.

In 2024, we expect this trend to continue gaining momentum. The SaaS model helps fintech achieve returns for considerable investment they’ve put into new products and experiences as well as provide predictability of revenue while improving accessibility for customers. Additionally, the scalability of SaaS solutions allows businesses to flexibly accommodate their growth.


5. The rise of AI-led fraud attacks such as deepfakes and voice clones

A survey conducted with 1,010 cybersecurity specialists about AI-assisted cyberattacks found that 75% of respondents said AI use in cyberattacks is increasing, and one in six had experienced an AI-assisted attack.

Chatbots, deepfakes, and voice clones are a few of the ways cybercriminals use AI to commit payment fraud. They use AI to develop deep fakes and voice clones of people in order to trick customer service representatives into transferring money to their accounts.

Additionally, AI is being used to develop new types of malware that can steal payment information from consumers. For example, there has been an increase in the use of "screen scraping" malware, which can record everything that a user types on their computer screen, including their payment information.


6. The rapid growth of embedded finance

The use of APIs are making it easier for non-financial companies to embed financial solutions into their products and platforms. For example, there are now insurance, investment and financing experiences embedded within e-commerce experiences. The growth is even more apparent on B2B e-commerce platforms offering trade credits and other payment terms, all while offering operational efficiency in managing payments within the same ecosystem. 

Additionally, Banking-as-a-Service(BaaS) and Wallet-as-a-Service(WaaS) are reshaping the way merchants accept payments as they become the building blocks for more flexible payment flows providing better visibility and control. The same infrastructure offering can also be used to offer stores of value which is particularly attractive to two-sided e-commerce such as marketplaces to help sellers manage their earnings more efficiently.


How will 2024 compare to 2023 for fintechs?

The economic downturn and AI era are making a ripple effect across all industries including fintech.

2023 tested companies ability to adapt to changing economic conditions and market dynamics, with the cost-of-living crisis weakening consumers' buying power and directly impacting businesses, rising interest rates that made BNPL solutions more attractive to consumers, the shrinking valuations and funding rounds and the pressure to implement AI into product offering to get ahead, have all been putting fintech companies through a survival phase in 2023. We expect these trends to continue in 2024. 


  • The impact of the rising interest rates

Central banks around the world are raising interest rates in an effort to combat inflation. This is making it more expensive for consumers and businesses to borrow money. As a result, consumers are looking for alternative ways to finance their purchases, such as buy now, pay later (BNPL) solutions.

BNPL solutions allow consumers to spread the cost of a purchase over a period of time, typically without interest. This can be a more attractive option for consumers who are struggling to afford to pay for a purchase upfront, especially in an environment of rising interest rates.


  • We expect heightened regulatory scrutiny 

Fintech brought exciting innovations shaping a more democratic financial landscape. However, with the multitude of tools and the application of new technologies like AI and blockchain that are now easily accessible to a wider audience, it's catching the attention of regulators.

We anticipate a heightened level of regulatory oversight. Fintech companies will need to navigate changing regulations concerning data privacy, cybersecurity, and financial services.

The economic downturn is also likely to lead to an increase in cybercrime, particularly in fintech, as it is the most attractive target for cybercriminals.


  • We’ll see more Mergers and Acquisitions (M&A)

The rising interest rates making cheap money less available and the current global investment focus towards solving climate change and other emerging technologies bottoms out fintech startup valuations, hindering their ability to grow. We’ve seen almost double the number of Mergers and Acquisitions (M&A) in the beginning of 2023 and we expect more in 2024 as the cost to acquire becomes cheaper than the cost to build.


What are the key regulatory changes for fintechs in 2024?


  • Global Perspective on DeFi Regulation

With DeFi becoming more integrated within business and consumer finance, it’s becoming more a frequent topic for discussion across different jurisdictions. 

The UK government is supportive of the development of DeFi, and the FCA has recognized the potential benefits of it, such as increased financial inclusion and innovation. However, the scale of its adoption prompted regulators to look into possible security threats it may pose.

Recently, the FCA has limited remit over crypto, and its current focus is on ensuring that crypto firms that operate in the UK comply with anti-money laundering and counter-terrorism legislation. The FCA has also hosted a CryptoSprint event to engage with the industry and gather feedback on how the industry should be regulated.

Meanwhile, many jurisdictions around the world are still in the infancy of developing their approach to regulating cryptoassets and cryptoasset services. 


  • ESG reporting requirements tighten for fintech in the EU

The European Commission's Corporate Sustainability Reporting directive mandates that banks and fintech companies provide increased transparency regarding their operations and approaches to addressing environmental changes. The European Banking Authority has been assigned the responsibility of preparing a report outlining the details of these ESG (Environmental, Social, and Governance) disclosures and issuing corresponding guidance.


  • Regulators crack down on capitalization and risk management at fintechs

Additionally, regulators are increasingly focusing on the capitalization and risk management of regulated fintechs. This is because fintechs are playing an increasingly important role in the financial system and regulators want to ensure that they are financially sound and able to protect their customers' deposits.


  • Brexit-related regulatory compliance to come into focus as FCA TPR grace period ends

Another regulatory concern to look out for promoted by Brexit is the increased focus on regulatory compliance as the grace period of the FCA EU license requirements comes to an end. Companies operating in the UK under a Temporary Permissions Regime (TPR) will need to be fully authorized by the FCA to continue operating in the UK.


How to stay ahead of compliance requirements?

Adapting to changing regulatory requirements remains one of the biggest challenges for fintech. However, there are fundamental habits that they can practice to make the adaptation frictionless. 


  • Collaborate with regulators: The best way to stay informed about recent compliance updates is to be transparent with regulators and work collaboratively with them. By doing so, fintech can work with regulators through compliance guidance and plan ahead in order to build a more future-proof technology that can easily adapt to regulatory changes. 
  • Adopt a customer-centric approach: Putting customers first, whether that customer is a consumer or business, is the foundation of compliance regulations. If this is a top priority for fintech companies, adhering to regulatory requirements would come naturally.
  • Scenario Planning: Develop contingency plans for regulatory changes to ensure that your business can adapt quickly to new requirements without major disruptions.
  • RegTech Solutions: Explore regulatory technology (RegTech) solutions that can automate and streamline compliance processes, making them more efficient and accurate. Investment in RegTech that takes away regulatory burden is worth every penny.
  • Regulatory Sandbox: If available in your jurisdiction, consider participating in regulatory sandboxes, which allow you to test and innovate within a controlled environment.
  • Adaptive Technology: Invest in technology that can easily adapt to changing regulatory requirements, making it easier to implement updates and changes as needed.



Trends are always changing. But there are permanent transformations that fintech should be prepared to embrace to stay relevant and competitive. As 2023 closes, it’s the best time to reflect on how these trends will influence consumer behavior and buying decisions. 

Navigating the rapidly changing digital landscape will always be a challenge but emerging trends open up new opportunities for fintech and solutions that can stay relevant will come out on top. 

To find out more about how Mangopay can help you select and connect the products you need to succeed, get in touch with us.