Kirsty Rutter - the Group's Fintech Investment Director - shares some of the fintech trends to look out for in 2024.

Kirsty Rutter
Fintech Investment Director
15 January 2024
5 min read

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. 



Join us as we reshape financial services

From customer focused roles in our branches, to specialist roles in tech and transformation.

No matter what role you’re in, you’ll have the opportunity to make a difference.

Start your job search Opens in same tab

Could fintech funding increase in 2024?

A decrease in interest rates this year could trigger more fintech investment. The last couple of years, though, have driven high levels of market uncertainty; the turmoil that followed the Russia-Ukraine conflict put pressures on the economic system, then some banks failed, and the fraudulent behaviour of some business leaders saw some unicorn businesses crumble (FTX). 

The resultant reset in the investment market has impacted valuations for fintech businesses. Into 2021, businesses were still able to achieve values of 15 to 20 times their revenue.1 As we start 2024, though, founders obtaining valuations of seven times revenue are considered in a strong position. This adjustment is taking some getting used to, especially considering that higher valuations were achieved through the early 2020’s. Accepting this market shift, then, can be difficult but necessary for investor confidence.

In terms of our own investment in fintech, we’ve recently invested in eight companies that we believe will bring value and deliver great outcomes for customers and clients. For example, we partnered with Enigio to deliver the world’s first transaction under the Electronic Trade Documents Act, supporting greater use of digital documentation in trade finance through the use of blockchain technology. We also launched our digital identity app in partnership with Yoti.

Lastly, in terms of the broader investment market, very little has been happening unless it’s related to Generative Artificial Intelligence (GAI). But I’ll delve into more on this below.

“Into 2021, businesses were still able to achieve values of 15 to 20 times their revenue. As we start 2024, founders obtaining valuations of seven times revenue are considered in a strong position.”

Fintech as a force for good in 2024

Following COP28 and the global agreement of transitioning away from fossil fuels, ESG and cleantech investment opportunities are certainly featuring high on the requirements of investors. In fact, data from Morgan Stanley shows that sustainable funds made a median return of 6.9% during the first half of 2023, outperforming traditional funds by 3.8%.2

Most successful fintechs are mission and purpose led. They exist to do things differently and we believe they can deliver great outcomes for customers and clients.

More so now than ever, businesses must consider their carbon footprints, the impact of their supply chains, their social impact, the gender balance in founding and leadership teams, as well as board membership. And there’s an urgent need for more founders and investors who are female and people of colour – both are hugely underrepresented at the time of writing. 

In terms of sustainability, at COP28 there were several announcements made on new funds and initiatives focused on investing for good, with a lens on international development. These included the UAE pledge of $30 billion for a fund to invest in climate friendly projects globally, with $5 billion for the Global South. Furthermore, The World Bank said it will increase its allocation of funding to climate related projects to 45%, which means $9 billion more in total.

Another reason to believe in fintech as a force for good is the introduction of programmable money. This technology can be used as a potential solution for delivering money to individuals and communities as effectively as possible – using event triggered programming (sometimes referred to as smart contracts, or distributed ledger technology (DLT) or blockchain) that releases funding to the individuals or communities that need it.

For example, an insurance product that is designed to pay out if crops are damaged due to drought. If certain conditions are met, then money is released almost immediately to those that have been recognised as most impacted.

“Most successful fintechs are mission and purpose led. They exist to do things differently and we believe they can deliver great outcomes for customers and clients.”

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. 




“I think we're going to continue to see controls, values and ethics dominate the AI market, alongside an increased rate of experimentation.”

What’s next?

Through 2024, I’ll be watching the impact of Apple’s use of open banking and Samsung’s developing “digital wallet” in the UK. Putting these technologies in the hands of consumers could change how we interact with money and financial services more broadly. And the need to protect and manage identity will be pushed up the agenda in 2024, too – not only in the context of fraud, but also as the unlock to developing innovations in payments.

In the spirit of the “rise of values”, I’m hoping to see an increasingly creative use of data to serve the needs of humanity and the community too. Open banking in the UK has supported new models over the last six years. And due to the UK experience, customers in the US are demanding similar capabilities. The US market may identify new ideas that will unlock more value – especially when coupled with GAI and the ability to drive value from unstructured data.

Looking ahead, GAI will surface new ways of operating within organisations. Roles that made sense in previous decades won’t be needed in the future, and a strong focus on upskilling will be key across the working population, but what should this mean for education? We need a stronger connection between schooling and the future world of work in the context of these new technologies. And we will continue to invest in 2024 and beyond, to help us move faster and deliver amazing outcomes for customers and clients.

Kirsty Rutter
About the author Kirsty Rutter

Fintech Investment Director

Kirsty has spent 25 years in financial services in roles spanning finance, strategy, risk, data, technology, innovation and strategic investment at six different Top Tier financial institutions.

Kirsty’s passion is organisational growth through cultural change; challenging the ways things “have always been done” and championing the opportunities that new tools and technologies bring.

Today, as the Group Fintech Investment Director, Kirsty uses her diverse experience to support business growth objectives and delivery through strategic fintech investment; focused on creating value by actively managing the portfolio across all businesses.

And whilst she’s doing that, she’s a wife and proud mum to two boys; who she says have taught her more than anything else she’s ever done.

Follow Kirsty on LinkedIn.

Kirsty's background Read less

Related content

Now recruiting: tech and transformation

We have 26 million customers right across the UK, with most already using our digital services. Now we want to bring even bigger solutions to even more people. You’ll help us do just that. 

Get more information Opens in same tab

What's next for fintech in 2023?

Kirsty Rutter  |  19 Jan 2023

Find out what Kirsty Rutter, the Group Strategic Investment Director thinks will be the top fintech trends in 2023, and what organisations should prioritise.

Read Kirsty's article

Working together with fintech SMEs

Jon Sykes | 6 Jun 2022

Find out more about our Launch Innovation Programme, which sees us working alongside Fintech Scotland to work in partnership with, and learn from, some of the best fintech SMEs in the country.

Read Jon's article