Key trends shaping the future of money

Section 1 explored the growth drivers of tech advancements, regulatory dynamics and shifting consumer preferences. Here we look at the key trends for leaders shaping talent strategies to pursue further opportunity and innovation.  

“In today’s financial landscape, where fintechs and digital banks are setting new benchmarks, established retail banks risk being left behind by nimbler, more innovative competitors,” says Andreas Landgrebe, Global Sector Co-Leader, Digital Transformation Leadership & Managing Partner, Central and Eastern Europe. “The long-standing decision-making processes and deeply ingrained structures that have defined traditional banking for decades must be re-evaluated and significantly dismantled. This shift in DNA is essential to truly embed a digital-first, customer-centric mindset across the entire institution.”

• Despite positive growth indications and a funding recovery in 2024, business leaders and investors face a complex path to growth, risk management (notably fraud) and profitability; the increasingly interconnected financial ecosystem is driving ever-closer connections between people, industries, remote markets and nations. Integrating financial services technology into platforms outside the financial sector through embedded finance is forecast to account for $320 billion in worldwide revenues by 2030, led by SMEs ($150 billion), consumers ($120 billion) and large enterprises ($50 billion)¹.
• Digital payments are therefore among the fastest growing segments in the fintech sector. While banking institutions accounted for nearly 71% of the cards and payments market in 2023 (valued then at c.$950 billion), Fintech Futures reports that non-banking institutions are expected to be the fastest growing segment in cards and payments from 2023-2028, with a CAGR of 9.65%. Plaid reports that new payment types are ‘rapidly becoming the norm’.
• Open banking has revolutionised payments, enabling customers without a traditional bank account to make payments through mobile phones, extending financial inclusion to those excluded from the traditional banking system. Open banking has made payments faster, more convenient, more cost effective, and arguably more secure through encryption and transmission via APIs. APIs enable third party providers access to bank accounts to initiate transactions on behalf of the user, without the need to manually input bank details.
• “The role of a Chief Digital Officer – or more specifically, a Chief AI Officer – is no longer just important for retail banks; it’s absolutely critical for their very survival,” says Landgrebe. “This role goes far beyond implementing new technology. For established banks to avoid obsolescence, the digital leader must orchestrate a complete reimagining of the customer journey – from reactive models to proactive engagement – requiring fundamental cultural transformation across every layer of the organisation.”
• Through open banking, adoption of Peer-2-Peer (P2P) bank payments is projected to reach nearly 184 million US mobile phone users by 2026. Stablecoins are increasingly used for P2P payments to transfer value, without intermediaries such as banks or payment processors, using blockchain technology. Use of stablecoins has mushroomed since 2020, with $2.5 trillion in payments settled annually between May 2023 and May 2024, according to Plaid.
• The consumer appetite for convenient, instant payments inspired the Federal Reserve to create an instant payment rail, FedNow, facilitating real-time bank payments – an alternative to traditional bank payments that settle in one to three business days – and bypassing credit or debit cards. Hitherto seen as ‘outlier payment models,’ these new offerings are becoming a mainstream alternative to traditional bank transfers.
• The payments sector has been transformed by AI, enabling new business models such as UK-based payments platform Zilch. The Ad-Subsidised Payments Network (ASPN) generates revenue from advertising rather than consumer fees, with AI tech helping brands to provide real-time, personalised offers at scale, as well as personalised discounts based on spending habits.
• Zilch has more than five million registered customers in the UK and serves almost 15% of the UK’s 34 million working population. It has saved customers over £750 million ($989 million) in cumulative interest and fees since its launch in September 2020. Revenues have doubled year-on-year, and the organisation has recently achieved quarterly profitability.
• Consumers are also attracted to WealthTech solutions that lower costs across the value chain, while using smart automation and data-driven insights to enhance accessibility and personalisation. Financial advisors are becoming financial planners, able to engage clients across their entire financial canvas. According to Allied Market Research, WealthTech enterprise solutions are forecast to reach $18.6 billion by 2031 at a CAGR of nearly 15%, up from nearly $5 billion in 2021.
• With tech advancement comes fraud. One of the biggest challenges in financial services, fraud is a leading concern in fintech, with identity theft facilitated by digital banking or crypto platforms. According to ID verification provider Sumsub’s Identify Fraud Report 2024, ID fraud increased by 73% from 2021-2023, sharpening the focus on anti-fraud software and regulatory protection.
• “With the sheer endless potential that comes with ever faster developments and innovations, the risk of fraud also increases,” says Klos. “It’s important that fraud risks remain manageable. If not, we run the risk of government regulation that will nip innovation in the bud.”
• In a constantly evolving regulatory environment, AI-driven fraud meets Agentic AI (autonomous systems built on LLMs) and AI-powered fraud detection of synthetic fraud, deep fakes, voice cloning and organised fraud rings. Fintechs and neobanks particularly are subject to complex national and international regulation around anti-money laundering and fraud prevention, critical to maintaining the customer trust that underpins market growth.
• Another key theme in the industry is profitability, which remains a key challenge for fintechs. According to BCG’s Global Fintech 2024 report, only 33 of the top 70 largest public fintechs were profitable in 2023. Those in the top quartile outpaced those in the bottom quartile by c.25 percentage points in all cost categories. BCG therefore calls for fintechs to improve EBITDA by building a scalable cost structure that will deliver compound returns.
• After a record year in 2023, leading challenger banks demonstrated profitability at scale: out of 453 digital challenger banks around the world, 23 were identified as operationally profitable. In Brazil, Nubank has more than 100 million users; in Europe Monzo announced its first annual profit in FY2023, just over $15 million, and in 2024 raised more than $600 million¹; and UK-based digital bank OakNorth announced $1 billion of lending to US businesses between July 2023 to May 2025, following pre-tax profits of $272 million for FY2024².
• IPO activity in early 2025 was thrown into question by tariff uncertainty. However, after a postponement by Chime, the US mobile banking provider’s shares closed 37% higher on its Nasdaq début in June 2025, according to PYMNTS; firms poised for IPO such as Swedish-based ‘buy-now, pay later’ fintech Klarna, wafer AI hardware maker Cerebras and Google’s AI model Gemini (which filed with the SEC in June 2025) will be watching carefully.
• In this interconnected web of financial and non-financial providers regulators have a pivotal role and are therefore increasingly prominent, occupying a more organic position through greater collaboration with financial institutions. To protect the interests of consumers in financial innovation, the Global Financial Innovation Network (GFIN) was launched in early 2019 by an international group of financial regulators and related organisations. GFIN also supports innovative firms’ interaction with regulators, particularly for new business models across multiple jurisdictions, and inter-regulation friction between, for example MiFID II and GDPR (affecting data collection, retention and access).
• The appointment to US regulators of experts with a pro-innovation stance is welcomed, particularly in the context of cryptocurrencies. As many as 80% of G20 countries have crypto regulation at some stage, from late-stage policy development to full implementation. The US is not among that 80%, which has seen developers moving offshore, resulting in part in the CHIPS and Science Act 2022, designed to bring the semi-conductor industry back to the US.
• The fast-evolving crypto industry is keen for regulation to keep up with market developments. Innovators need rules that can be coded into protocols, platforms and other ways to ensure compliance. Not having robust, far-sighted regulation disincentivises innovation, and leaves disruptors building capabilities while not knowing whether customers will be able to use them.
• Fintech innovation, connectivity and transformation is driving a multi-web, multi-country, multi-player financial ecosystem based on partnerships not competition, with digital-first, mobile strategies delivering growth, creating new markets, new revenue streams and new opportunities yet to be discovered.
• Accordingly, the global fintech sector is expected to see a rebound in investment and M&A activity through 2025, driven by economic recovery, supportive regulatory environments and technological advancements, particularly AI. According to Linklaters, AI investments in banking and financial services are expected to rise by $31 billion worldwide by end of 2025.

Read more on the topic: 

• Fintech Futures: Cards and Payments Market Opportunities and strategies 2024-2028 and 2033
• World Economic Forum: Why embedded finance is a disruptive force financial institutions can’t ignore
• BCG: Global Fintech: Prudence, Profits and Growth, Second Edition BCG and QED Investors
• Appinventiv: FinTech in Wealth Management
• McKinsey: How financial institutions can improve their governance of gen AI
• Linklaters: Fintech & Payments Legal Outlook 2025 – a global perspective

¹ BCG ibid.
² According to OakNorth announcements, 6 March 2025 and 2 May 2025