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FinTech 2020: Year In Review

2020 has been the year of COVID and there is no other way around it. The pandemic was both the intro and the plot of this past year as well as the driving force behind anything that happened in the FinTech and broader tech industry. 

With 2020 almost in the rearview mirror, let’s revisit some of this year’s milestone events and learnings. 

COVID-19 Making Digital Transformation Mandatory

Remember when small to medium businesses saw a digital presence as a nice option to have, a good alternative or something to think about in the future? Well, the future came much faster than anyone would have anticipated and the pandemic turned the option to a necessity. 

Lockdown measures and the post-apocalyptic living conditions we were forced to endure during the past year, completely reshaped the way businesses view the digital world. According to the latest Digital Commerce 360 analysis of the U.S. Department of Commerce data. In the first six months of the year, consumers spent $347.26 billion online with U.S. retailers, up 30.1% from $266.84 billion for the same period in 2019. 

In Q2, $200.72 billion was spent online, an uptake of 44.4% year over year. To contextualize these numbers, think that $1 in every $5 spent came from orders placed on the web during the April-June period. 

It’s not hard to understand that since traditional, brick and mortar shops locked their doors with still, no definite answer as to when they will reopen, businesses had to turn to the online market. 

Websites, online shops, digital marketing ads, social media strategies, and search engine optimization suddenly became an integral part of business. Some of you might argue that there is no novelty in the aforementioned areas and that any serious business worth its salt should have been using them already. Yes and no. 

Pre-pandemic, digital presence and the amount of effort and resources invested in it were mostly dependent on the size and industry of a business. Now, companies of all sizes and sectors have to migrate to the digital world as we are slowly moving to a cashless economy.

Digital transformation does not only apply in the customer-facing part of the business. Businesses were also asked to revisit their internal structure and operations this year. Transitioning to working from home had HR departments going back to the drawing board, trying to solve the remote work riddle. Luckily, artificial intelligence and human resources are a match made in heaven with workspace technology revolutionizing work as we know it.  

Embedded Finance

Embedded finance is defined as the process of integrating financial technology into non-financial platforms, products or services. Let us give you an example. 

US Tech conglomerates Google, Amazon, Uber and WhatsApp are all involved in embedded finance projects. 2020 was the embedded finance coming out party as tech companies realized the potential of the sector. 

That explains why a recent report by Lightyear Capital, estimates that embedded finance will grow from $22.5 billion in 2020 to $230 billion in 2025, during which period the sector will create more than $1 trillion in value before rising further to $3.6 trillion by 2030.

According to US venture capital (VC) firm, Andreessen Horowitz, embedded finance is set to increase the profitability of a customer by more than five times, making it a major source of income for these organizations. 

People seek end-to-end solutions and giving them the chance to do more with their money and interact in more than one way with a product, it’s definitely the way to go. Some actually argue that embedded finance is the biggest threat to traditional banking.

The Year Of Open Banking

2020 saw a surge in the number of open banking users, with the U.K. hitting 2 million open banking users in September, up from a million in January 2020. 

According to the October 2020 Business Insider reports, the Consumer Financial Protection Bureau (CFPB) was looking for guidance on how to to grant consumers access to their financial records in the U.S, hinting towards the development of open banking rules.

The open banking regulation was also leveraged by Australia, Brazil, and the United Arab Emirates. The future looks promising for open banking as according to a survey by Accenture, 90% of bankers believe open banking will boost organic growth by up to 10%. Having the buy-in of the traditional banking industry is big, even though the transition will definitely be challenging. 


It was a year of challenges and obstacles and if there is one word we can say to summarize it that would be: adaptation. The business environment has been as dynamic as ever before and the companies that will manage to adapt and pivot the best will be the ones to make it through. 

Tech always finds a way to adapt and we believe that 2021 will bring more disruption and innovation.