Over the last few years, the fintech industry has gone through a roller coaster ride. After 2020-2021, things slowed down, became confusing and even scary for all startups and investors. IPO vanished, funding dropped, and many organizations started cutting costs just to manage and survive.
But now things are slowly and steadily changing.
While going through a couple of fintech newsletters, one line stood out and left a lasting impression.
“The market is not roaring back- but it is waking up”
It’s not like a sudden comeback or a bang. It’s just an early morning sunrise after a long night.
Earlier, investors used to put money anywhere as long as the company was growing fast, but currently, there is a shift in mindset. Growth is not a single thing to think about. They want useful problem-solving products, strong business models, profitability and loyal customers. Companies and financial Institutions that simply burned money to grow quickly are struggling, but those quiet achievers who believed in slow, profitable growth and delivered real value to customers are shining now. It’s a big and healthy change.
Another thing to notice is M & A, Merger and Acquisitions. In 2025, more than 50 per cent of deals are above $100 Million. That means large financial institutions and PE Firms are back to buying companies. They are confident enough because they see the value they get and the company they are buying will deliver. Strong companies that build impactful products are finally getting their spotlight.
The most exciting part of one of the newsletters is the role of AI. It’s not the future, it’s happening now. Financial institutions are using AI for better fraud detection, faster loan approvals, smarter investment advice, personalized mobile banking, and automating all the back-office work. Investors are focusing on and preferring AI-ready solutions/products because they scale better with less cost. It’s a superpower, Its AI.
Based on the latest research, there is a huge gap between different fintech verticals. Capital Market Technology, Wealth Tech, Data & Analytics and Trading Infrastructure gained the most value and demand, while trends saw slow and negative growth in consumer lending apps, neo banks, BNPL apps and insurtech.
In Conclusion
One of the most insightful observations is that growing slowly, growing smart, and growing profitably are the best keys to success in the fintech industry. The next fintech wave won’t be about hype. It will be completely based on trust, stability, and smart innovation. For anyone in banking and fintech- founder/ analyst/banker, and investors. This is the perfect time to think about long-term embracing AI and focus on building real value.
Abhijeet is a Business Analyst with over 6 years of experience in the Banking and Financial Services Industry. He specializes in Cards and Payments, Fraud Analytics, and Low-Code Platforms. He has worked with companies like Citi and FIS, and is currently working at Happiest Minds, helping build better banking products and digital solutions.
He enjoys solving problems, working with data, and turning business ideas into real products. With hands-on experience, he focuses on making banking more efficient.
