What’s New and Next in Fintech?


When I last looked at my smartphone, I had at least eight different finance-focused apps to manage my money. Many of these apps were developed by fintech firms which, for the purposes of this article, are finance-focused companies that don’t have a traditional brick-and-mortar retail business. I’m not alone in my interest in fintech: Worldwide, Google web searches for the term “fintech” have steadily grown over the past five years. (Source: Google Trends, web searches for the term “fintech” worldwide, 2015–2020.) 

And according to research firm CB Insights, global fintech funding reached US$24.6 billion through the third quarter of 2019, which is nearly US$6 billion more than the entire global fintech funding raised in 2017.

Services from companies like Affirm, which lets consumers use fixed monthly payments (with interest) for online purchases, and Venmo, a peer-to-peer payments platform, make it easier than ever to buy goods and transfer money without ever having to visit a physical bank. While fintech companies span both B2B (business-to-business) and B2C (business-to-consumer) categories, this article will focus on B2C fintech companies. 

In my role as a strategist, I frequently work with clients to monitor and assess emerging trends in order to understand how those trends could impact a client’s market position. As the global fintech industry continues to evolve, it’s important to understand not only what trends are impacting the industry now, but also how they’re expected to impact the industry in the future. Below are three key trends happening in fintech and what the Firewood strategy team thinks might happen next. 

Mobile growth in Africa
  • What’s happening now: Mobile payment platforms are rapidly growing across Africa. Flutterwave, a peer-to-peer payments platform that’s based in the US and has a large presence in Africa, recently announced new partnerships with Worldpay and Visa to expand its presence across the continent. 
  • What’s expected next: Fintech firms should pay close attention to the African market, which is expected to see huge population growth in the next few decades. In fact, the UN expects Africa to account for more than half of global population growth between now and 2050, with the sub-Saharan population expected to double in that time. As this population grows, we expect an increase in demand for consumer banking products. 
  • Why it matters: The fintech firms that become the dominant players in Africa could become the next trillion-dollar corporations. 
Big tech takes on banking
  • What’s happening now: As consumers become more comfortable using their smartphones to do everything from trade stocks to purchase products, big tech firms are finding ways to further integrate themselves into their customers’ financial lives. Apple and Goldman Sachs recently launched a new Apple credit card, while Google is partnering with Citigroup and the Stanford Federal Credit Union to offer a new “smart checking” account, although there are few details on the project. Traditional banks are getting ahead of the competition by rolling out their own digital payment services, such as Bank of America with Zelle, its peer-to-peer payments app. Zelle’s success makes it easy to understand why big tech firms are interested in the mobile payment space: Zelle transactions grew 72% last year, reaching US$187 billion in total payments processed in 2019. 
  • What’s expected next: Expect more scrutiny from government regulators. Apple’s credit card issuer, Goldman Sachs, is currently under investigation by New York state regulators after consumers started complaining on social media about gender-biased Apple Card credit limits. In the era of “move fast and break things,” the financial services industry remains a highly regulated behemoth. Any attempts from big tech to disrupt the industry can expect to be closely examined by government regulators. 
  • Why it matters: With the increased scrutiny on big tech companies from regulators and consumers alike, these firms will need to tread carefully as they enter the financial services sector. Any major missteps from these new ventures could result in lasting reputational damage to the larger parent organization.
Installment payments go digital
  • What’s happening now: Fintech companies like Affirm are making it easier than ever for consumers to purchase everything from jackets to Super Bowl tickets using installment loans instead of traditional cash or credit cards. 
  • What’s expected next: Once reserved for major purchases like refrigerators and washing machines, installment plans can now be used for everyday items like shoes and makeup. As the number of consumers taking advantage of installment loans continues to grow, expect more companies to offer similar installment plans. 
  • Why it matters: This changes consumer purchasing behavior in ways that may affect how companies market their products, who their target audiences are, and what consumers’ preferences are. As the consumer path to purchase evolves, the most successful fintech firms will create new opportunities for consumers to obtain their desired products and services more seamlessly than ever before. 

While we can’t always predict how trends like population growth and big tech product launches will impact the fintech industry, it’s important to evaluate these trends now so that we can anticipate, and potentially mitigate, any industry or consumer risks. The fintech apps on my phone might change, but my need to easily and seamlessly manage my money will not. 

About Kate Erickson

Strategy Director Kate Erickson works with Firewood technology clients to identify new growth opportunities across each firm’s brand and product portfolio. Prior to joining Firewood, Kate was the associate director of marketplace and content insights at Condé Nast, where she conducted advertising sales research across their portfolio of brands, including Vogue, Vanity Fair, and The New Yorker. Kate holds a BA in economics from the University of Pennsylvania and an MBA from the NYU Stern School of Business.