In Mambu’s 2022 partner predictions free-to-download report, experts across the fintech and financial services industries bring in the best emerging trends for what’s going to be hot next year. Partners ranging from Google Cloud, Deloitte, McKinsey, nCino and many more call attention to what to expect from 2022 and what impact the trends will have for financial institutions and their customers.
Look out for embedded finance and cryptocurrencies, sustainable finance and Big Tech in banking… Here’s what’s coming to a financial institution near you next year.
Embedded finance will blur the boundaries between goods and the financial supply chain. Banks who will adopt new age, cloud native architectures for scalability and security, and embrace openness to API ecosystems, will be agile enough to react to consumer demands and stay relevant in this integrated economy.
2022 will be the year of innovative user experience and broad access to emerging payment channels like crypto and real-time payments. We expect to see traditional banks reinventing their financial products to offer crypto and competing with fintechs to satisfy increasingly demanding financial clients.
On the back of COP26 and with the EU’s Sustainable Finance Disclosure Regulation coming into effect, financial institutions will have to do more in 2022 to lead a systemic change and focus on environmental, social and governance (ESG) and sustainable finance. As reporting requirements grow, financial institutions will need a better way to see, manage and report on their full carbon-footprint, across sectors and geographies.
Before the pandemic, the industry was already in the midst of an evolutionary change of historic proportions. Propelled by a massive shift in social behaviour, banks emerged from the transformation as software companies. Forward-thinking banks will choose between transforming themselves into modern fintech companies or becoming critical infrastructure providers for these companies.
In recent years the ‘death’ of cash has been a commonly-covered topic in the media, but COVID-19 may prove to be one of the final nails in the coffin. In 2022, we’ll see an increasing number of retailers and hospitality venues who won’t handle physical money, while the use of contactless and mobile wallets is certainly going to grow, as more people will leave their physical wallets at home.
Cloud-based core banking systems are making it easier for non-financial firms to launch banks and new service offerings, thus questioning the relevance of legacy operations in traditional banking. However, tech savvy financial institutions will have a great opportunity to launch Banking as a Service platforms and monetise their BaaS platforms to open up new revenue streams.
Partnering with a fintech company used to be the ‘in’ thing to do. But now it makes sense for customers, and improves their experience and both banks and fintechs will embrace their cultural differences to drive more partnerships. Banks and fintechs are never going to be the same. And that’s fine. As long as they have a shared purpose, finance will be better.