The year 2022 could be remembered in the Fintech sphere as the year of the boom of new solutions for the management of accounts and bureaucracy of small and medium-sized Italian companies.
Recent years have seen progressive investments in the green transition and automation of digital processes. In particular, Artificial Intelligence (AI) has now progressed to the point where it is integrated into most business activities, leading to higher productivity, shorter lead times and advanced analytics. In this respect, the Italian fintech ecosystem has great potential, but there is still room for improvement.
What are the main emerging Fintech trends that will drive innovation and change in the industry this year?
1. Artificial Intelligence against fraud
According to a McAfee report, cybercrime weighs in at $600 billion on the global economy, and with the digital boom driven by the Covid-19 pandemic, it has become an increasing threat to banks and consumers.
The use of artificial intelligence systems to detect fraud has helped companies improve internal security, and AI has emerged as an important tool to prevent financial crime. It can be used to analyse huge amounts of transaction data in order to detect fraud trends, to reject transactions altogether or flag them for further investigation, or to assess the likelihood of fraud. Artificial intelligence, or rather machine learning, can also learn from investigators when they assess that they are facing attempted theft.
2. Cryptocurrencies and blockchain entering the mainstream
Banks and financial services in general are accelerating the adoption of blockchain-based systems and this will lead to a positive change for both customers and the banks themselves.
The benefit for consumers will be fairer access to financial services. For their part, banks may have the opportunity to expand and reach out to new markets where blockchain is entering powerfully, from art to music to gaming, more and more companies are requesting the intermediation of trusted institutions that can act as guarantors of transparency in transactions.
3. Digital yuan on the way
2022 will most likely be the year when China's first digital state currency (CBDC) sees the light of day. The new currency was demonstrated as part of a pilot project during the Beijing Winter Olympics.
This is a case in point of a new and thought-provoking trend: finance today prefers to incorporate new technological solutions into what already exists, in a new wave of synergies between financial and insurance products, low- and no-code services, direct account-to-account payments and other agile solutions that are already becoming an integral part of business operations.
4. Embedded finance
Embedded finance is the combination of a non-financial service provider and a financial service. According to experts, it represents a new phase of fintech, the foundations of which were laid by PSD2 and the opening of banking APOs to third parties.
In 2022 we can expect embedded finance to grow further as more non-financial brands seek to integrate payments, loans, insurance products and wealth management services into their user journeys. They will also focus on specific niches, tailoring their offerings to customers' needs. The result will be greater speed, transparency and convenience in purchasing and payments.
5. Payments in the metaverse
The metaverse could not be missing from the forecasts and trends for the evolution of the fintech sector. Mark Zuckerberg's statements on the timing and methods of the new use of social networks suggest that digital payments in virtual worlds will be launched as early as 2023.
NFT and decentralised finance (DeFi) will form the basis for the development of the digital ecosystem, the uses and methods of which have yet to be tested. However, it is easy to imagine a rapid spread of NFT and, in general, of tokenization projects in finance and digital payments.