Natalie Monko Lead Project Manager

    Fintech Trends: What Drives the Industry in 2021

    FinTech services are defined as innovative business models and financial technology for providing, improving and disrupting financial solutions. According to EY research, during the years 2015-2019, adoption of fintech by consumers doubled steadily each year and reached 64% in 2019. The pandemic strengthened the positions of fintech further since its services are more easily adaptable and scalable than those of traditional banks and big financial institutions and can fulfill almost all of the customers’ needs remotely via digital channels.

    Today, the demand for fintech solutions that provide digital payments and remote banking is steadily growing. More and more people choose to open their phones to get a loan or trade stocks instead of going to a bank office or calling a brokerage firm. Surf team knows the fintech industry firsthand: in the last couple of years, we’ve developed mobile apps for four banks and a crypto exchange. Let’s take a look at the key trends that are adopted and propelled by key players and define what the future of fintech will look like.

    Contactless payments

    Amid the COVID pandemic, the increase of contactless payments usage jumped to a record 40%. As people tried to minimize contacts with banknotes and ATMs fearing possible virus contamination, cash and plastic credit cards fell out of favor. Currently, the most widely used contactless technology is NFC payment, when a user uses their phone instead of a credit card. Another one of the fintech payment trends, QR codes, rapidly catches up with NFC. How does QR payments work? A user scans a code with their phone and accesses data, which can be a website link or payment details. QR-codes offer better security because a merchant’s point of sale doesn’t read a client’s information, and some other unique benefits: they can store a large amount of data, be static or dynamic (think one-time payments), can get scanned from a distance and even when partly damaged. For example, the digital bank Revolut offered merchants a convenient way to set up QR-codes via Revolut Business app to help to maintain social distance with customers.

    Advertisement of QR-codes feature in Revolut Business app (source:

    Microservices and open banking

    One of the top fintech trends, outlined by many experts, is the fragmentation of financial service providers. A big bank, which previously was a sole place for people to get loans, transfer money and keep their possessions, gets substituted by multiple small-scale companies focused on one of the before-mentioned banking services and alternative solutions such as crypto. The competition leads to a better customer experience and more affordable services. For banks, one of the ways to survive is to adapt and become hubs of such third-party financial service providers. Otherwise, they risk losing a big part of their customer base. 

    This shift to microservices within banks can’t be done without the concept of Open Banking — the use of open APIs (application programming interfaces) and open-source technologies that allow third-party companies to provide services to a bank’s customers. Another important aspect of this fintech banking trend is a shift in attitude regarding data ownership: Open Banking makes the financial process more transparent without putting data privacy at risk. For example, to completely change banks, in the future, a customer won’t need to visit a bank branch: their former bank will just handle their data to the new one and delete the client’s information from its database.

    Responsible banking and sustainable finance

    As people become more aware of the society’s impact on the environment and growing inequality inside the public, more financial institutions adopt the United Nations ‘Responsible Banking’ initiative focused on creating long-term benefits to society, transparency and accountability. Along with this initiative, sustainable finance, which takes into consideration environmental and social impact, is on the rise. Responsible fintech solutions for banks include the usage of eco-friendly materials for plastic cards and digital banking, which leaves a small to zero carbon footprint. For example, Amalgamated Bank is committed to using only renewable energy in its operations, and Aspiration Zero rewards users for going carbon neutral.

    In 2017, 1.7 billion people had no banking account. The majority of them were women and men and women in poorer households. In an attempt to improve the situation, banking institutions are widely accepting the initiative of financial inclusion aimed at an equal opportunity to access financial products, such as banking, loan and insurance for everyone.

    Mobile-first approach

    According to American Banks Association, more than 70% of Americans preferred online banking to visiting bank branches, and more than half of that number banked using their mobile phones. And these figures are likely to increase further in the future. Since websites and apps of traditional banks often lack speed, features and convenience, compared to those of neo-banks that operate exclusively online, physical banks are at high risk of gradually losing their customers. 

    How Americans interact 
with their banks
    Americans preferred banking methods (source:

    That is why more and more financial businesses adopt a mobile-first approach, focusing on customer and bank interactions via a mobile app. Ideally, a customer of a modern bank doesn’t have to pay a visit to a bank at any point of a customer journey: they can open an account, issue a card, apply for a loan and close the account via an app. But if adopted hastily, a mobile-first approach can backfire: freezes and app security issues can ruin the bank’s reputation for good.

    When Surf developed a corporate banking app for Rosbank (part of Société Générale group), it was the first Russian banking app built with Flutter cross-platform technology that uses one set of code for both iOS and Android apps. The choice of Flutter framework not only saved our client a considerable part of the budget but also allowed us to create a smooth working app that is beautiful, scalable and secure: Dart coding language used in Flutter is compiled into native, non-human readable code, that makes it even more secure than Java or Kotlin. As a result, Tagline Awards, the highest Russian award for interactive projects, named Rosbank corporate banking app the best solution in the Banking, Finance, and Insurance category.

    Rosbank corporate banking app

    Blockchain and decentralized finance

    The key idea of blockchain is the elimination of a centralized intermediary for asset transfer, which can be any property, both physical (cars, houses) and digital (digital artworks). Traditionally, the role of an intermediary was performed by a bank, which authenticated the person and authorized the deal. And to complete just one transaction, banks usually took two-three days. 

    With blockchain and peer-to-peer transactions, everything happens within minutes, without additional expenses on intermediaries, while a public audit trail stored in a distributed database serves as a stellar proof of transaction. Thus, early blockchain technology adopters can achieve a significant increase in speed and transparency of transactions, leading to better performance and competitive advantage.

    Artificial intelligence and machine learning

    The analysis of customers’ behavior using AI and ML lets fintech companies create solutions with a previously unachievable level of personalization, as well as use it for fraud prevention and accurate forecasts and predictions.

    For example, AI-driven chatbots and robo-advisors can provide valuable investment insights and recommendations, based on customers’ level of risk tolerance, expected return and available funds. Automated investing solutions used by such fintech investment apps as Betterment and Wealthfront are infinitely more scalable than human financial advisors, so they can help a larger client base.

    Artificial intelligence 
and machine learning
    Wealthfront app

    Access to big data allows fintech to quickly detect anomalies and prevent fraud, money laundering and terrorist financing. Also, the use of machine learning helps companies to comply with demanding requirements of regulators with more return on their investments, compared to more traditional cybersecurity departments.

    By analyzing spending patterns, customer feedback, activity on social networks and other aspects, fintech companies can accurately assess the likelihood of what their clients are going to do next. Predictive analytics powered by AI gives a powerful tool for providing a more personalized experience and suggesting new products to customers. 

    New payroll solutions

    While the majority of fintech projects have been focused on new payment technologies, lately an increase can be noticed in companies offering new payroll solutions. Their innovative financial products can generally be divided into three categories. 

    • Salary On-demand solutions let an employee choose when to get paid for work done, instead of waiting for a rigid payday date. For example, Salary Finance allows customers to get up to 30% of their earned pay in advance at any given date. 
    • Salary Advance providers, such as Early Salary let users make short-term loans based on their salaries without sky-high rates. 
    • Solutions in the Crypto Payroll category enables wage payments in a chosen cryptocurrency. Being driven largely by small-scale innovative companies, crypto solutions give more flexibility to wage payments and allow more financial freedom.

    Regulators are showing interest in fintech

    As new technologies in financial services arise and more money flows from big financial institutions and traditional instruments to companies that offer innovative banking products, government bodies watch their operations closely. The blockchain and how it can be used from a regulatory viewpoint is of particular interest to US regulators. This gave rise to the so-called ‘RegTech’ companies that digitize regulatory technology: an anti-money-laundering platform Hummingbird, an on-demand portal for audit and policy management Continuity and many others. 

    Despite assumptions of those who picture any regulation as an absolute evil, it is a natural field of work for the government to balance innovative ways of money management and investment with potential risks. For any fintech startup, there is no chance to completely avoid governmental control and guidance for long, so a constructive dialogue is a better way for long-term success.

    To sum things up

    Most of the fintech companies are still not mature enough to say for sure whether their concepts and business models are to withstand the test of time. By its nature, the financial services industry is always watched closely by authorities and tightly regulated. This makes the best course of action for small-scale businesses to form alliances and work out together ways to implement innovations sustainably and securely.

    Type of device Americans use to visit websites
    Type of device Americans use to visit websites (source:

    Whether the fintech technology trends listed above are short-lived or can bring a long-term meaningful change also remains to be seen. The one broad technology trend that has been around for years and we would like to point out is an ongoing shift from computers to mobile phones. In 2016 mobile devices accounted for 44% of all web visits in the US, and in 2020 this figure reached 61%. In the future, the percentage of mobile users is likely to grow even more, so if you’re doing business in the fintech industry, a mobile app is a must-have option for communication with your customers.

    Surf has been in app development for almost 10 years, creating native apps for iOS and Android and cross-platform apps with Flutter. So if you have an app idea in mind, fill in the short form, and we’ll contact you to estimate it and discuss the details.