Cloud adoption and AI to make FinTech worth $1,085 bn by 2032, study shows

By Puja Sharma

“According to the latest research study, the demand of FinTech market accounted for $160.8 billion in 2022 and is estimated to be  $1,085.9 billion by 2032 and is anticipated to register a CAGR of 19.8% over the forecast period”

Financial technology (FinTech) is software that automates and digitises financial services across a wide range of industries. FinTech applications include mobile banking. The FinTech industry also includes payment applications, robo-advisors, crypto apps, peer-to-peer lending applications, and robo-advisors.

Rapid growth in cloud computing and artificial intelligence and cloud computing has boosted the adoption of FinTech technologies which, in turn, contributed to the market growth. The growing adoption of smartphones, laptops, and online banking has provided lucrative opportunities for target market growth. Growing FinTech startups in emerging economies have further facilitated the demand for FinTech market growth.

New developments

• In July 2022, GoHenry acquired Pixpay to strengthen its strong position in the market and to expand its business in the U.S. market. The company provides financial education apps and Visa debit cards and strengthens its position in youth banking.
• In September 2022, US equity management FinTech Carta acquired UK’s Capdesk. This acquisition allows Carta to take on Capdesk’s network of European startup cap tables and expand its presence in the European market.

The FinTech market is constantly evolving, with new developments and trends emerging regularly. Key recent trends include the adoption of digital currencies and blockchain technology, expanded services beyond traditional banking, and increased use of artificial intelligence and machine learning.

Mobile banking and payment solutions are becoming more prevalent, as are open banking initiatives that enable greater collaboration between banks and FinTech companies. Cybersecurity and data privacy are increasingly important, as are financial inclusion initiatives to make financial services more accessible. Non-traditional lending and investment options are gaining popularity, and the COVID-19 pandemic has accelerated the adoption of digital financial services.

What is driving the growth

• Technological advancements: Advances in technology have enabled FinTech companies to provide innovative products and services that are convenient and cost-effective for customers.
• Increasing adoption of digital payments: With the rise of e-commerce and mobile payments, there is an increasing demand for digital payment solutions that are fast, secure, and reliable.
• Growing customer demand for personalized services: Customers expect personalized financial services tailored to their needs, and FinTech companies are well-positioned to deliver on this demand.
• Regulatory changes: Regulatory changes and initiatives such as open banking are creating opportunities for FinTech companies to offer new services and collaborate with traditional financial institutions.
• Globalization: The globalization of financial services is creating new opportunities for FinTech companies to expand their services to new markets and customers.
• Investment in FinTech: Venture capitalists and other investors are pouring large amounts of capital into the FinTech industry, which is driving innovation and fueling growth.
• Increasing financial inclusion: FinTech companies are helping to bridge the gap between underbanked populations and financial services, by offering new and innovative solutions to provide financial access to these populations.
• Changing consumer behavior: Consumer behavior is changing, with more people opting for digital financial services over traditional banking methods, creating new opportunities for FinTech companies to grow and expand their services.