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Fintech fights back

Fintech found itself battered and bruised in 2022. Investors pulled back on funding. Headlines touted fraud allegations involving Covid fund distributions and Ponzi schemes. Government agencies threatened stricter regulations. Yet, despite facing the toughest market conditions since their inception, fintech startups are finding ways to adapt by entering new markets and catering to evolving businesses.



  • Nearly two-thirds (65.3 percent) of the U.S. population uses digital banking services. (

  • Almost 80 percent of millennials reported using digital banking in 2022. (

  • The fintech market grew from an estimated $105.41 billion in 2021 to $131.95 billion in 2022. By 2026, the fintech industry is projected to grow to $324 billion at a compound annual growth rate (CAGR) of 25.18%. (Market Data Forecast)


As we enter 2023, the world of fintech continues to evolve at a rapid pace. Startups, especially those without a track record, are likely to continue to struggle to secure investment, but innovation will continue to be a hallmark of the industry. With advancements in technology and changes in consumer behavior, the financial industry is being transformed. Here are some of the top fintech trends that are expected to dominate in 2023.

Digital Banking

With the rise of smartphones and other mobile devices, more and more consumers are turning to digital banking options. Digital banking allows users to manage their finances, pay bills, transfer money, and access other financial services through their mobile devices or computers. As a result, traditional banks are investing heavily in digital transformation to keep up with the changing needs of consumers. According to Cornerstone Advisors' “What's Going On in Banking 2023” study, there are about 500 community banks and credit unions making direct investments into fintech startups. Among community banks investing in fintech startups, the average investment was nearly $3 million per bank in 2022.

Blockchain for Payments and Settlements

Blockchain technology is being used to facilitate faster and more secure payments and settlements. Blockchain-based payment systems offer the potential for lower transaction fees, faster settlement times, and increased security. This technology is also being used to enable cross-border payments, which can be faster, cheaper, and more efficient than traditional payment methods

Decentralized Finance

Decentralized Finance (DeFi) is a blockchain-based financial system that allows users to transact without the need for traditional intermediaries such as banks. DeFi offers a range of financial services, including lending, borrowing, and trading, using decentralized applications (dApps) built on blockchain technology. In 2023, we can expect to see continued growth in the DeFi ecosystem, as more investors seek to benefit from the high returns and low transaction costs that DeFi offers.

Artificial Intelligence

Artificial Intelligence (AI) is increasingly being used in the financial industry to improve customer service, streamline operations, and enhance security. AI-powered chatbots, for example, can provide personalized support to customers and help them resolve issues quickly. AI can also be used to analyze large amounts of data to identify patterns and make more accurate predictions, which is particularly useful in areas such as fraud detection and risk management. With the expansion of AI, we are seeing better and more intuitive robo-advisors. They can analyze vast amounts of data to identify investment opportunities and risks and create portfolios that are tailored to each individual's investment goals and risk tolerance. Robo-advisors are typically more affordable than traditional financial advisors and offer a convenient, user-friendly way to invest.

Digital Lending

Digital lending platforms use algorithms and data analysis to assess borrowers' creditworthiness and provide loans. They can offer faster loan approval times and more flexible lending terms than traditional lenders. Digital lending platforms are also more accessible to people who may have difficulty accessing traditional loans, such as those with thin credit histories or low credit scores.


As fintech continues to grow, so too does the threat of cyber-attacks. According to APIsec, the eight areas most vulnerable to cyber-attacks are: identity theft, data breaches, DDoS attacks, integration loopholes, AI fuzzing, phishing attacks, insider threats, and regulatory compliance. To strengthen protections against these threats, 2023 will see increased investment in cybersecurity measures, such as multi-factor authentication, biometric identification, and advanced encryption technologies. Fintech companies will also need to ensure that their employees are trained to identify and respond to security threats.

ESG Investing

Environmental, Social, and Governance (ESG) investing is a growing trend in the financial industry. ESG investors consider the social and environmental impact of companies when making investment decisions, in addition to financial performance. In 2023, we can expect to see increased demand for ESG investments, as consumers become more aware of the impact their investments can have on society and the environment.

Despite some setbacks, fintech will continue to be a driving force of the future. Throughout 2023, we can expect to see it regain its momentum as we see automation and integration growing more sophisticated and a greater use of blockchain, AI and IoT in financial transactions. Being able to deliver on innovative processes will be the difference between those companies that succeed and those that fall by the wayside.

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