Embedded finance, or integrated finance, has led fintechs into the future. The ability given to companies (all of them, regardless of their industry of interest) to integrate financial services within their offerings expanded the market for fintech startups that understood how their solutions could be cross-functional.
What's more, companies understood that this new paradigm would create the best possible customer experience, increasing customer loyalty.
Increasingly vertical embedded finance (we'll explain what that means in a moment) is one of the 5 trends for 2022 that will define the banking and finance industry according to Solarisbank, the Berlin-based technology platform that helps companies integrate financial services via APIs, led by Roland Foltz that can count on a market capitalization of over one billion euros.
According to the German fintech, embedded finance is set to gain momentum in 2022, with non-bank companies launching financial services increasingly built on their customers' needs in specific market niches. It will become increasingly common to walk into a store to make a purchase of a good or service and simultaneously be able to access a loan, without ever having to leave the store to go to a third party. As you can imagine, this opportunity offered to customers will speed up access to financial services.
The next year would be the year of BNPL, acronym of Buy Now Pay Later. Scalapay offers the possibility for customers to buy in a store or point of sale and complete the payment in three monthly installments (we talk about it here). Also Solarisbank, in its trend analysis, confirms the boom of the BNPL by virtue of the advantages it offers to customers and companies, such as the guarantee of a greater customer loyalty and the possibility offered to small and medium ecommerce sites to resist the competition of the big players, especially in highlights such as sales and promotional initiatives.
Fintech, and more specifically digital banking, has changed the face of banks, which have gone from being counters for offering information and carrying out paperwork, to becoming true consulting centers. According to Solarisbank, this trend is set to increase and even change, becoming verticalized. anks and fintechs will increasingly create services targeted at specific categories in niches that until now have been little considered, such as teenage banking.
Digital fraud attempts has raised by 150% in 2021. However, there is also some good news and it comes from technology with artificial intelligence software already proving to be a remedy to reduce the incidence of fraud in finance. According to Solarisbank, in 2022 we will see a proliferation of these solutions and for fintechs that specialize in the field of cyber security, very attractive market scenarios are opening up.
The NFT boom and blockchain that has already widely shown its transversality: not only supply chain and document certification, the technology is expanding into fields such as art, music, games, etc. According to Solarisbank, this is a trend for banks to seize as there will be an increasing need for "trusted institutions to act as custodians." For banks to take on this role means being able to expand their financial services, reach out to new markets and at the same time ensure more equal access to financial services.