With the adoption of digital processes, the realm of fintech is set to evolve in the year 2023. The financial services industry and its ecosystem have developed, diversified, and grown more competitive during the last two years due to digital technologies that are upending traditional business models and specialized use cases.

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Trends that will Impact
the Fintech Realm in 2023

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• The Growth of SaaS Platforms
• Embedded Finance
• Regulatory Technology
• Open Banking
• Open Banking
Top fintech trends that will make it big
in 2023 and the future.

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Trends that will Impact the Fintech Realm in 2023
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For banks, FIs, and aggregators, it is necessary to have a keen eye on the changing fintech trends as it will
determine the prospects. In addition, leading banks are looking forward to ‘humanizing’ the banking process to
render a more personalized experience to consumers. This blog will discuss the top fintech trends that will make it
big in 2023 and the future.
With the adoption of digital processes, the realm of
fintech is set to evolve in the year 2023. The financial
services industry and its ecosystem have developed,
diversified, and grown more competitive during the
last two years due to digital technologies that are
upending traditional business models and specialized
use cases. Consumers and businesses across the globe
have adopted digital banking and FinTech platforms
due to the pandemic-induced push for digital
adoption, 5G-enabled handheld devices, faster and
more ubiquitous internet connection, and the
government's push for a digital economy.

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The Growth of SaaS Platforms
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The growth of SaaS platforms has been unprecedented,
and the industry is expected to be at $623 billion in
2023, with a growth rate of 18%. Software as a Service
(also known as SaaS) allows organizations to avoid the
labor-intensive management and installation of complex
software and hardware. Platforms for the Fintech
industry enterprises offer better customer experiences
and quicker product delivery, increasing user and
customer satisfaction. In 2023, we anticipate that the
number of low-code or no-code solutions, white-labeled
SaaS, and micro-SaaS products will rise.

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Embedded Finance Will be Big in 2023
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The embedded finance ecosystem is vast and is anticipated
to expand greatly this year. Businesses can boost customer
happiness and income by providing comprehensive offers
throughout a client's journey with embedded finance.
Financial services include banking, credit, investing,
processing payments, lending, and insurance. Consider an
online retailer that offers insurance through a simple,
convenient, and seamless client experience.
Buy now pay later (BNPL) is a field of embedded finance
rapidly expanding across the board. This payment method
allows customers to place an order today and pay for their
purchases later, typically in a series of payments.

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Regulatory Technology Will Get More Acceptance
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Regulatory Technology, also known as RegTech, has gained
everyone’s attention in recent times and will grow its horizon
in 2023. It’s a branch of the fintech industry that uses
technology to monitor regulatory processes. Businesses in the
RegTech sector typically deal with tracking, reporting, and
compliance-related issues.
By 2030, it is predicted that the RegTech market will reach a
startling $44 billion. In contrast, in 2021, it was only valued at
$8.2 billion.
For the growth of RegTech, FinTech development is necessary.
The fact that more services are becoming digital is astonishing,
but there are also more significant concerns. Fraud, hacking,
data breaches, and other potential risks thrive in the
unregulated digital financial ecosystem. Therefore, financial
institutions are constantly under pressure.

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Greater Market Penetration of Open Banking
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An innovative banking technique known as "open
banking gives third-party API service providers free
access to financial data from banks and other financial
organizations. Banks and financial institutions can
significantly customize their offers thanks to open
banking solutions and access to account information.
For instance, the bank may suggest a loan based on
your income and creditworthiness if you are saving for
a new automobile or a tempting lease.

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Significant gains of the proper implementation of Open banking
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Marketplaces
With the aid of open banking, banks may now create end-to-end
solutions for their marketplaces. Customers can select the services
they want to connect with, including savings accounts and pension
programs. This sharpens the emphasis on the consumer and enables
banks to provide them with relevant and timely solutions.
Affiliate Networks
Banks may now give their customers a new feature: accessing their
account data from many banks in a single application. This is
possible because banks are involved in a single regulatory system
that permits them to share consumer information.
Digitization
Because the Open API is made of high-quality software, banks
incorporating it will modernize their tech stack, giving them a
competitive edge against fintech firms.

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Business Expansion of Blockchain Technology
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Blockchain technology, also known as Distributed
Ledger Technology (DLT), makes it easier to store, share,
synchronize, and distribute data among a distributed
network of users. It forms the basis of several cutting-
edge technologies that are being introduced to the
financial markets.
Blockchain technology is way beyond the horizon of just
cryptocurrencies. Let's examine the key areas where
blockchain technology is having an impact on the
fintech industry.

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Impact of Blockchain technology on Fintech industry
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Decentralized Finance
DeFi approach uses deterministic smart contracts, which
dramatically enhance efficiency, transparency, and security while
lowering the danger of intermediaries just in it for their financial
gain. It is a word used to describe software systems that do
transactional data validation automatically, thus eliminating the
need for intermediaries.
Zero-Knowledge Proof Authentication
Zero-knowledge authentication techniques are yet another novel
use of blockchain in the fintech industry. Customers currently must
divulge vital information to authenticate their identity online. Online
users can share the required information for each transaction using
zero-knowledge proof authentication, while other data is kept
secure on the server of a reputable supplier.

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Final Thoughts
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The fintech industry is anticipated to keep developing into
2023, with several exciting trends emerging that may alter
how people manage their finances. Additionally, as more
firms see the potential of technology when aiming to
support employees, financial well-being is becoming an
increasingly important trend in the fintech sector.
The economy calls for greater financial inclusion, which can
be accomplished through technological innovation and
regulatory framework extension. The protection of user
information and funds will inevitably become more difficult
due to the impending openness. Economic growth can be
boosted by a coordinated effort by fintech, banking, non-
banking, and government organizations to improve
outreach and security and make credit more accessible.

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