What's next for fintech in 2024?

From how we pay for goods and services to the ability to manage our investments from virtually anywhere on the planet – there’s no doubt that fintech has transformed financial services for the better. But, like most sectors, the industry was tested over the last year by rising inflation, an increased cost of living and geopolitical events which shook the markets and rattled investors. 

However, as I said at the beginning of 2023, fintech’s are tenacious and adaptable. They were created to solve problems, to make our lives easier and, as such, it’s in times of uncertainty that the best fintech’s – those with great propositions and strong leadership – emerge even stronger. The question is: what kind of challenges might arise for them in 2024? And how might those challenges affect the financial services industry in general?
 

Closing the digital divide in 2024

Last year, I considered the pace at which new technologies continue to grow and discussed what this meant for an aging population. Everything from getting a doctor’s appointment to traveling by public transport is affected by new technologies. And more needs to be done to ensure older generations are comfortable using this new technology, which is one of the reasons why Lloyds Bank offers a Digital Helpline – an online hub that offers help and guidance on all things digital. 

However, one of the biggest challenges regarding accessibility and in closing the digital divide is the cost of devices – especially against the backdrop of the rising cost of living. The good news is, there are several charities supporting those that need help getting hold of laptops and phones, such as Digital Poverty Alliance and The good things foundation.

On the other hand, digitally native generations (younger people who grew up swiping screens), want services that can be accessed through mobile applications. This demographic tends to have a greater need for “in the moment” responses and, as such, they continue to drive demand and push for new models and approaches. In this case, where lives are spent increasingly “in app”, with individuals spending more of their time on hand-held screens, balance becomes increasingly important – for a person’s mental health, as well as their productivity. 

The rise of artificial intelligence in 2024

Back in 2023, I mentioned the rise of micro communities – a further extension of the shift from globalisation to localisation, supported by developing technologies. 

In 2024, though, I think we are going to see a “rise of values.” And we’ll need to think about a host of technologies and how they can work together. For example, we’ll need to consider how GAI and augmented reality might impact training in healthcare and schools, how it might impact the future of banking, and how GAI and programmable money might change how we shop and pay for goods and services.

The pace at which things are changing is incredible. But what is clear is that the need to run and operate systems that are adequately understood and controlled will be essential. The reaction in 2023, when experts called for the use and development of GAI to be stopped so we could take stock, understand and put controls in place, has resulted in various regulatory proposals surfacing across the globe. Whilst these proposals are not yet harmonised it’s clear that we need to care more about the impact technology has on our lives. 

And if 2024 is the rise of values, it's also the rise of privacy; a shift from information being open to all (e.g., cookies that track just about everything), towards technology that is accessed on the user’s terms and in line with their values. I think we're going to continue to see controls, values and ethics dominate the AI market, alongside an increased rate of experimentation. 

Then comes the friction between climate and GAI. The volume of data in our world has doubled in the last two years.³ All that data needs to be stored and processed to deliver valuable insights and engagement. That requires energy, which drives heat and carbon emissions. Indeed, the conflict between the demand for real time personalisation and the creation of the data to facilitate this is at odds with our collective focus on the climate.

To reduce carbon emissions, we need to reconsider how much new data we are creating and opportunities to use smaller data sets and lower compute power. 

One opportunity could be local “edge computing”, where mobile phones themselves become personal processors. Personally, I’m hopeful for a shift to a focus on values, that we will also shift to a focus on humanity and how technology supports quality of life.