5 Key financial trends we’re keeping an eye on in 2024

From our latest research, we uncovered that 68% of senior decision-makers are currently undertaking some form of digital transformation in the UK. 

Which shouldn’t come as much of a surprise given the near constant news of the ‘rise of digital transformation.’ The tricky bit is staying up to date and identifying which trends are most relevant to you and your business.  

As a fintech, we make sure to keep an eye on evolving technologies and business changes within the financial space. In this blog post, we’ve listed the top five that we’ll be keeping our fingers on the pulse of for 2024.

1. The rise and app-lication of mobile payments

We’ve been hearing whispers of a ‘cashless society’ for a while now. And cashless transactions are expected to increase significantly in the next two years.  

Adapting to a cashless world is a necessity for businesses. But understanding the reasons why these methods of payment are overtaking cash is the first step in keeping up to date with its rapid evolution.

Digital wallets becoming the norm

Thanks to the rise in digital wallets, gone are the days of standing in line at the supermarket and realising your purse is home on the kitchen table. Being able to keep your credit and debit cards, coupons, and even concert tickets in one place on your smartphone makes them far more convenient than their physical counterparts.

Digital wallets such as Alipay, PayPal and Google and Apple Pay were the leading global payment method in 2023, taking up nearly half of worldwide transactions. And they show no signs of slowing down in the near future. 

Speedier shopping with contactless payments

Accelerated by the pandemic, contactless transactions are quickly becoming the preferred payment choice. Efficiency and convenience are why 53.8% of EU card payments in the second half of 2022 were contactless, and why they’re expected to nearly double by 2025. 

They also make transactions up to 10 times faster. 

Smart devices, smart payments 

The Internet of Things, or IoT technology, is a network of connected devices that can communicate with each other. And allows for a great number of devices to not only pay for things, but also be intelligent enough to notify you when you need to buy something. 

In simple terms, imagine a smart fridge that connects to the internet through IoT technology and can monitor how much of a certain product you have left. It can add a carton of milk or that much-needed tub of hummus to your shopping list and then automatically process the payment (once confirmed, of course) through your online payment method. 

And wearable payment systems like smart watches can even allow users to make contactless payments with biometric authentication.

2. All biometrics, Zero Trust

Since AI’s breakthrough, cybersecurity has faced myriad risks in the form of phishing, malicious software and vulnerability exploitation. 

Making it more important than ever for businesses and finance teams to invest in sophisticated cybersecurity measures. 

Biometric authentication 

Only passwords, pin codes and swipe cards are slowly becoming a thing of the past as many customers and businesses have started implementing more robust security measures. 

Biometric authentication incorporates both a password or pin code and a fingerprint or facial recognition. Not only does it reduce the risk of identity theft or fraud, it can add a second layer of security for passwords or pin codes that are easily guessable or stolen. 

Zero Trust Security 

It does what it says on the tin: Zero Trust Security assumes that all access attempts, whether by users, devices or applications, are untrustworthy.

No matter the origin, organisations are required to verify and authorise all access attempts to mitigate the risk of any security breaches. This allows them to protect themselves, and their financial data, from both internal threats such as hacked accounts, and external threats like cyber attacks and data breaches. 

Implementing Zero Trust Security ensures that only authorised users can access certain resources, such as company money, making it important for businesses to consider when stepping up their security. 

3. Non-financial reporting for better sustainability

Climate change initiatives have been in the limelight for a while, but this year is gearing up to be a big one for companies in addressing their impact on the environment. 

Companies are starting to take sustainability more seriously. Whether that’s because they’ll be directly affected by environmental risks, or upcoming regulations will affect their business. 

New initiatives like the Corporate Sustainability Reporting Directive mean big changes for many companies and investors.

The Corporate Sustainability Reporting Directive (CSRD)

The CSRD took effect in January of 2023, the rules of which will be applied by companies for the first time in 2024. 

The new directive will mean that investors and stakeholders need to assess their company’s impact on the environment, along with any financial risks and opportunities that might come from climate change and sustainability. 

4. Generative AI

The release of ChatGPT was a technology milestone and even set records for the fastest growing user base in history. As AI continues to progress, we’ll likely see it more and more in daily life. But what will that look like? 

Automated reporting

Reporting requirements are a notorious drain on businesses and they’re steadily being increased in many countries. 

Thanks to digital transformation, the tedious and time consuming tasks of reporting can be replaced by AI systems which can analyse sets of data to generate reports. Anything from financial reports to market analysis, cross-border transactions and even sales trends can be automated and digitised.

Transformation for finance teams

Manual expense reporting has historically been repetitive and at times clunky for finance teams, and certainly not immune to human error. 

Financial data spans the entire organisation: across borders and markets, ERP systems, databases and even those infamous spreadsheets. 

Not only will it accelerate financial analysis, it will make life infinitely easier for those in finance. 

Removing the manual drain on finance

Invoice management, payables and receivables, tracking expenses, gathering receipts, analysing data… the list of manual admin goes on and on. 

AI can transform these tedious tasks, getting rid of the manual strain on finance professionals so they can use their skills elsewhere. 

Freeing up the finance team not only allows them to save time, but enables them to make more data-driven decisions and provide expertise in other areas of the business. 

5. Open Banking

And the last trend on our list: Open Banking. 

Traditionally, banks have always kept the financial data of their customers inside their own systems (and for good reason ). 

Sounds a bit scary, right? 

But it’s actually hugely beneficial for both businesses and consumers. 

Better control and security of financial data 

Although the name is a bit of a paradox, the idea behind Open Banking is actually to give customers more control over their financial data. The customer has the ability to decide who has access to their data, and how much they can access. 

Since Open Banking is also tied in with payment services, no payment can be made without the customer’s authorisation. 

Centralised finances for businesses

Not only can business finance data be centralised in one place, it can be easily accessed through integrated Open Banking systems. 

For small businesses in particular, managing the different areas of finance can be tricky. But having access to real-time transactions, invoices, and other financial information allows businesses to make more informed, data-driven decisions. 

Better financial analysis 

With open access to real-time data comes improved analysis tools and more robust management of budgets, accounts and transactions. Spending patterns can be analysed to help users make better financial decisions in a safer and faster way. 

And on the flipside, not only can payments be optimised, but businesses can use their customers’ financial data to offer more personalised, improved services. Any change in demand from customers can be acted upon quickly and efficiently which enables a better customer experience. 

Looking forward

Adapting to changing technologies in the market is never easy. But being willing to change is fundamental. 

There may be some things that will change how your business operates, and others that don’t even apply. By moving away from manual admin with digital transformation and automation, you can focus on where you could be utilising your talented team members. 

Automated reporting, less manual drain, more productive finance teams and way less stress are just the beginning for us when considering these trends. What could they do for your business?