The Future of Finance: Atomised, Embedded, and Real-Time

The financial services industry is undergoing significant transformation, propelled by emerging technologies, evolving customer expectations, and innovative business models. At the forefront of this shift are three critical trends: atomisation, embedded finance, and real-time capabilities, as stated in Fintech Futures.

Key Trends Reshaping Finance:

• Atomisation involves breaking traditional financial services into smaller, specialised parts, enabling consumers to select services tailored to their needs. Mobile wallets such as Apple Pay and Google Pay exemplify this trend, allowing users to add cards for budgeting, spending, or investments. Niche financial solutions like micro-investing platforms are also gaining popularity.
• Embedded Finance integrates financial services into non-financial platforms, blending payments, lending, and insurance into everyday activities. With projections suggesting this market could reach $7 trillion by 2030, the seamless integration of these services aims to enhance customer experience and engagement.
• Real-Time Capabilities meet the demand for instant financial services, offering immediate transactions, dynamic pricing, and fraud detection. Innovations like AI and others are helping drive these advancements, making financial interactions faster and more secure.

Despite the opportunities these trends offer, traditional banks are under increasing pressure. Key challenges include:

1. Underperformance – Many banks struggle to meet required returns on equity, making profitability difficult to sustain.
2. Legacy Systems – Outdated infrastructure hinders innovation, putting banks at a disadvantage compared to agile fintech firms.
3. Customer Expectations – Modern consumers demand personalised, seamless experiences that many traditional banks struggle to deliver.
4. Intense Competition – Digital-first banks and fintechs pose a challenge with their advanced technologies and user-focused strategies.
5. Regulatory Pressure – Compliance with evolving regulations demands significant investment, straining banks with limited margins.
6. Economic Instability – Fluctuating interest rates and geopolitical uncertainty complicate long-term planning.
7. Talent Shortage – Banks compete with tech companies for specialised talent, crucial for their digital transformation efforts.

To stay competitive, incumbent banks need to accelerate digital transformation, modernise their core systems gradually, and develop strategic partnerships with fintechs. Adopting cloud technologies and AI-driven analytics will enable banks to offer personalised services, improve risk management, and optimise operations.

Innovation and agility are key to success in the evolving landscape. Banks must explore new growth opportunities, such as embedded finance and open banking, while leveraging their established strengths, such as brand trust and regulatory expertise. A shift towards a more flexible, digital-first approach will empower banks to meet customer demands and enhance profitability.

“The convergence of atomisation, embedded finance, and real-time capabilities is setting the stage for a new era in finance,” writes Dave Wallace. “This evolution promises hyper-personalised products, increased financial inclusion, and improved customer experiences.”

The future of finance is becoming increasingly integrated into our daily lives, and those banks that adapt swiftly will emerge as leaders in this dynamic environment.