How technology is impacting fintech now and in the next 5 years

Technology cycles now move so fast that it’s a challenge to evaluate every trend: Is it relevant? Is it useful? Is it applicable to every part of financial services? Technologies can move from cool futurism to current application with a speed that means “we can think about that later” can be a costly attitude.

The aim of our new research report: Fintech 5X5 was to determine what fintech professionals thought of the five different technologies that we saw as having the biggest potential impact over the next five years. We wanted to discover how tech innovations are going to affect our industry from the people implementing it.

To get a good understanding of the current situation, we first asked which technologies fintechs had already implemented.

Graph technolgies already implemented

We were surprised to learn that AI was in use by almost 70% of respondents, despite it being generally regarded as a future technology forever “five years away”. Blockchain, on the other hand, had only been implemented by around 20%, despite a history of recent hype. And while edge computing (10%) and low-code (16%) had only been deployed by a minority, APIs are being used by pretty much everyone.

We then asked respondents to rate the impact of five different technologies over the next year, and over the longer term, putting them in order. This was the average rating:

Most impact in the next year	Most impact in next five years
1. APIs	1. AI
2. AI	2. Blockchain
3. Blockchain	3. APIs
4. Low-code	4. Edge computing
5. Edge computing	5. Low-code

APIs are seen as having the most immediate impact. This is unsurprising as APIs are in use today, and their effect is increasingly obvious in Open Banking—and soon in Open Finance. But they remain important over the long term. Integration of services will continue.

Potentially more surprising is AI. According toour respondents, its time is here, and it’s only going to be more important long term. As before, this perennial future tech is now seen as very much here in the present.

Potentially surprising is blockchain seen as having more impact over the long term.
Many recent news stories on blockchain technologies have been negative, from the NFT bubble to crypto instability. But blockchain is increasingly seen as its own thing, and the negative press hasn’t dampened enthusiasm for the underlying technology.

Low-code and edge computing are languishing at the bottom of the table. We believe these technologies will have as much of an impact as the others, but just don’t have the same “buzz” right now—they are underlying, technical solutions rather than breakout superstars. But those technologies that automate, reduce costs and boosts efficiencies will get their time in the sun.