The past year, as the fintech industry is acutely aware, has not been without its challenges. From the continued COVID-19 global pandemic to whispers of a looming recession, and with mass layoffs to follow, the fintech industry has faced incredible uncertainty.
Future of Fintech
As we look ahead to 2023, we can’t help but anticipate the disruption and breakthrough that’s to follow such great challenges. Innovation will remain a core business driver, but so too will conventional business best practices. There are three core products and services to watch in the year ahead as businesses look to remain competitive in a challenging economic environment: the expansion of Platform as a Service (PaaS), credit-building tools and resources, and customer-first business operations.
Platform as a Service (PaaS) Is Growing and Only Getting Bigger with Fintech
Over the course of the last year, Anything as a Service (XaaS)—the general category of services related to cloud computing, remote access, and any sort of IT function—has continued to expand; and with no signs of slowing. PaaS is no different and has seen incredible growth opportunities, particularly among Integrated Software Vendors (ISVs), Independent Sales Organizations (ISOs), financial platforms, and payment companies. In fact, by 2026, the global PaaS market is expected to be worth an estimated $164.3B, growing at a CAGR of 19.6 percent.
Companies across industries are now facing pressures to transform and re-evaluate legacy payment processes in order to keep pace with competitors and the change of payments innovation. For ISVs and ISOs, and other financial product companies, managing the payments process can often be challenging and cumbersome, and it isn’t easy to navigate the increasing challenges of today’s financial ecosystem. With integrated payment solutions, ISVs are empowered to provide merchants with an improved user experience with consolidated processes and enhanced security. PaaS is not only benefiting the wide-range of fintech businesses currently looking to transition to a more modern cloud computing architecture, but it also improves the end-user experience as it allows these companies to meet the more unique and differentiated needs of their customers.
As we look ahead to the new year, PaaS will be an important area of growth opportunity across fintech, particularly as businesses look to keep costs low, weather global economic challenges, and develop new solutions quickly.
The Emergence of Credit Building Tools and Cash Flow Solutions in the Midst of Economic Downturn
With ongoing news of a looming economic recession, cash flow management solutions have become a growing priority among customers. In uncertain times, understanding where capital is going is more important than ever.
As we’ve seen across industries, businesses have already begun tightening budgets and prioritizing cash on hand. We expect this trend to continue, and with it, an increased prioritization of credit building tools and cash flow management solutions across businesses to empower secure and informed decisions to weather economic headwinds. The fintech leaders that are helping customers to reconcile and manage expenses efficiently will be the ones to differentiate among the noise. Business critical IT decision-making resources will likely be spared from budget cuts in the new year.
Customer Centricity in the New Year: Providing Superior Experiences Will Win the Challenge of Choice
Where PaaS and credit building resources prioritize innovation, above all else, customer service – although nothing new or groundbreaking – remains of utmost importance for businesses today. And with new fintech darlings emerging at breakneck speed, the CX-led businesses will be the ones to succeed in today’s competitive environment.
Although a modern payments platform is critical when processing payments, only relying on the technology comes with disadvantages. Excellent customer service is no longer defined by a 24/7 chatbot support but rather by industry expertise, coupled with innovative technology that is flexible and can be adapted to solve complex payments problems. Humanizing the customer interaction and working alongside the customer as they’re navigating current environmental challenges is crucial to not only improve the overall customer experience but also increase customer retention.
For businesses looking to grow their market share in 2023, the ones who will beat out the competition are the ones that are keeping the customer in mind every step of the way, through curated solutions and customized processes.