Prospective Areas for Fintech Investments

In 2023, the financial technology industry continues to actively develop and expand its capabilities. According to forecasts, the volume of the fintech space will increase several times and reach $174 billion.

If we talk about investments in fintech, according to results. According to an analysis by the international company KPMG, investments in the financial technology sector reached $210 billion in 2021, which exceeded the same figure for the previous period by $90 billion.

Also in 2021, about 5,700 transactions were completed in the fintech market. Investment in payments grew to $51.7 billion, up from $29.1 billion in 2020. Investments in blockchain and cryptocurrency totaled $30.2 billion in 2021, up from $5.5 billion in 2020. However, in the first half of 2023, investment fell by 49%: from approximately $46 billion in the second half of 2022 to $23 billion.

According to industry analysts, the largest market will be the digital investment market with an AUM of $112.90 billion in 2023. The average AUM per user will be $439.80. Revenue growth in the digital asset market is expected to reach 33.6% in 2024.

Sergey Kondratenko is a recognised specialist in a wide range of e-commerce services with experience for many years. Now, Sergey is the owner and leader of a group of companies engaged not only in different segments of e-commerce, but also successfully operating in different jurisdictions, represented on all continents of the world. The main goal is to drive new traffic, create and deliver an online experience that will endear users to the brand, and turn visitors into customers while maximising overall profitability of the online business

Sergey Kondratenko: promising areas for investing in fintech

Fintech continues to integrate into many industries and bring innovation to the financial services industry. Among the main technological trends that will determine the development of the fintech industry in the coming years, Sergey Kondratenko highlights the field of artificial intelligence and machine learning.

The use of AI and ML will enable the creation of unique solutions for data analysis, forecasting market trends, risk management and the development of personalised financial solutions.

• Biometrics and security. Implementation of biometric systems for customer authentication, strengthening security measures and data protection.
• Virtual banking. Development of digital banks and financial platforms that provide a full range of banking services online, without physical branches.
• Robotic voice assistants. Creation of voice assistants and chatbots for customer service, information provision and financial management.
• Virtual and augmented reality. Applying VR and AR to education, investing and financial services with a more interactive and visual approach.

Artificial intelligence and machine learning are the future of fintech

According to Sergey Kondratenko, the use of artificial intelligence (AI) in the financial industry really helps improve the quality of service and reduce operating costs. The introduction of AI in Fintech will allow companies to create advanced customised solutions:

• Robo-advisors. Automated robots and chatbots are capable of performing a number of tasks, such as processing customer requests, basic transactions, and providing information about banking services. This allows you to reduce the load on live operators and improve the availability of customer service 24/7.
• Voice assistants. The use of voice assistants, similar to Siri, Alexa or Google Assistant, can improve interaction with customers, provide them with the ability to manage their finances and receive information by voice. It’s convenient and effective.
• Data Analytics. AI can analyse large volumes of data, identify trends and predict risks, which helps financial institutions make more informed decisions and reduce operational costs.
• Process automation. Using AI to automate routine tasks such as processing loan applications, customer verification and portfolio management can significantly improve the efficiency of financial services companies.
• Improved prognosis. AI is capable of predicting market trends and risks, which helps firms make more informed investment decisions and optimise portfolios.

Sergey Kondratenko believes that AI will play a key role in the fintech sector.

Robo-advisor as a profitable assistant for investing in fintech

The emergence of robo-advisors has broken down some of the traditional barriers between the financial services industry and everyday consumers. Thanks to these tools, competent financial planning has become accessible to almost everyone, not just wealthy people.

Sergey Kondratenko explains that robo-advisor platforms offer automated, algorithmic services for financial planning and investing with virtually no human intervention. A typical robo-advisor asks a client questions about their financial situation and future goals through an online survey. It then uses the data to make recommendations and make automated investments.

Robo-advisors provide a more affordable alternative to traditional advisors as they can provide the same services at a lower cost due to the lack of human interaction. Robo-advisors tend to make it easier to keep track of investments. Logging into the system is possible 24 hours a day as long as you have an Internet connection.

– Before these and online brokerage accounts, if a client wanted to make a trade, they had to call or meet with a financial advisor. Then explain your needs to him and wait for him to make a deal. Now all this can be done without leaving home, comments Sergey Kondratenko.

Use of blockchain technologies

Technological progress continues to advance rapidly. And blockchain represents one of the most exciting trends in fintech.

– The blockchain contains information about all actions of system participants. Essentially, it is a digital ledger in which various types of transactions are recorded and verified, explains Sergey Kondratenko.

The specialist emphasises that blockchain allows individuals, organisations and machines to safely transfer digital assets. The important thing is that there is no need to contact any central authority or third party intermediary. The principle of decentralisation means that blockchain technology can be used in various financial areas, such as making payments, making transfers and conducting trade.

A decentralised payment system has a number of advantages:

1. Efficiency of payment processing. Due to the absence of intermediaries and the ability to conduct transactions directly between participants, decentralised systems facilitate fast payment processing.
2. Automation of business processes. The use of smart contracts in the system allows you to automate the execution of transaction terms, which simplifies and speeds up business processes.
3. Minimising errors. Each transaction is securely recorded in the blockchain, which reduces the likelihood of errors and eliminates the possibility of data falsification.
4. Reduce costs. Eliminating the need to involve intermediary companies and banking institutions reduces commission costs and simplifies the payment processing process. Moreover, it leads to significant savings.

Sergey Kondratenko is convinced that fintech will remain a driving force in the future. In 2024, greater use of blockchain and artificial intelligence in financial transactions is expected. As a result, clients will have access to services that better suit their individual needs. That is, technological innovation continues to change the financial sector. Kondratenko believes that companies and investors must keep up with such trends, otherwise they risk being left out of the game.

As with all investment opportunities, it’s important to do your own research. Some investments can result in a loss of your capital.