Finovate Blog

With only a few weeks to go until 2025, it is time to take a look at some of the trends we can expect to see more of in the next 12 months. There are a handful of topics that seem to be dominating the conversation in fintech as we wrap up 2024, and here’s what you’ll need to know as we head into 2025.

Crypto

I have to apologize for this one, because I know that many readers don’t want to hear anything about crypto. It does, however, need to be considered.

Why it’s big: After a dip and many volatile few years, crypto is entering a more mature phase. The conversation is no longer just about Bitcoin and speculative trading. Instead, we’re seeing increased institutional adoption and clearer regulatory frameworks emerging across the globe. With this, major players are poised to enter (or re-enter) the crypto space, which positions crypto as no longer a fringe technology, but a part of the financial ecosystem.

What you need to do about it: If you haven’t already, now is the time to educate yourself and your organization about crypto. Go beyond the basics and evaluate how blockchain technology might be relevant to your own operations. Also, stay informed about regulatory changes, as they are sure to change as crypto continues to evolve.

Stablecoins

This technically fits into the crypto category, but it deserves a highlight all on its own because of the potential. Stablecoins are a type of cryptocurrency pegged to a fiat currency or a commodity, such as gold.

Why it’s big: Stablecoins bridge the gap between the volatility of traditional cryptocurrencies and the stability of fiat currencies. They have been successfully used in cross-border payments, remittances, and payroll for global workforces because they enable instant payouts at rates much cheaper than funds sent via traditional banking rails.

What you need to do about it: Organizations operating in payments should investigate the costs and benefits of integrating stablecoins into their offerings. In particular, if your firm services businesses with international clients or cross-border supply chains, you should explore how stablecoin adoption could help service your commercial clients.

Open banking/ Section 1033

For U.S. readers, open banking made its debut in the form of a CFPB ruling in October of this year. Firms with the largest assets have until 2026 to comply, and those with assets between $10 billion and $250 billion have until 2027. There may be benefits to early compliance.

Why it’s big: The new open banking rule shifts data ownership from the financial institution to the individual consumer. This shift creates more opportunities for innovation, improved transparency, and more personalized services. The U.K. and Australia, which are early leaders when it comes to open banking, have already proven that giving consumers control over their own data is beneficial to multiple parties.

What you need to do about it: Even though some firms have until 2027 to prepare, start preparing now, as you may need to invest in infrastructure upgrades such as developing new APIs. Early compliance could give you a competitive edge by offering you time to create new products and services tailored to your customers.

Honorable mentions

Condensing fintech down into three topics does not capture the widespread nature of the industry, so here are some honorable mentions.

Agentic AI
You may notice I did not include AI, which is a notoriously hot topic, among the top three trends. That is because the industry has finally moved beyond talking about AI as the technology to implement, and now considers it as the enabling technology that it is. Agentic AI, however, has its own role to play, especially in wealth management and back office automation. AI that can act independently to make decisions based on customer preferences or operational needs will play a large role in shaping fintech’s future.

BNPL
With Klarna’s IPO taking place in 2025, we can expect to see interest in the BNPL space surge to new heights. However, it won’t reach 2020 levels because questions about regulation and profitability remain, especially as interest rates vacillate. However, BNPL continues to evolve with new players entering the space and existing ones expanding into adjacent markets like subscriptions and services.

Regtech
The ongoing fallout from the Synapse failure has created a renewed focus on regulatory compliance. Banks are rethinking their regtech strategies, while new regtechs are leveraging tools such as large language models and GenAI to meet demand for automated compliance tools and fraud detection solutions.

Real-time payments
The adoption of real-time payment systems has been gaining momentum across the globe, especially since the launch of the Federal Reserve’s FedNow service in 2023. While more businesses and consumers are slowly becoming accustomed to instant transactions, banks have shown hesitancy to send real-time payments.

Pay-by-bank
In many ways, pay-by-bank goes hand-in-hand with open banking, which is fueling the growth in pay-by-bank. Direct, bank-to-bank payments are popular with merchants because of the lower fees and faster settlement times. Consumers, however, may be hesitant to use pay-by-bank unless they receive a monetary incentive at the point of purchase.

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