Last year proved a turbulent year for the FinTech sector. Although the industry continued to boom, the Brexit vote and the election of Donald Trump seem to have caused many investors to pause and reconsider investing in Europe and North America. According to statistics from KPMG and CB Insights, less than half the amount was invested in FinTech firms in the third quarter of 2016 compared with 2015.

2017 has so far brought with it little political certainty and, as the FinTech sector starts to mature, it is increasingly hard to tell what is next for the industry. In this article, we highlight some of our top predictions.

1. Mobile and contactless spending will continue to grow

Mobile payment apps such as Apple Pay, Google Wallet and Venmo have transformed the way we pay and, in 2017, they are set to gain more momentum. Mobile-to-mobile payments are now easier and cheaper than ever and, according to an ABI Research study, contactless payments are expected to double in 2017. There is even the suggestion that advances made in mobile payments could cause credit and debit cards to start to disappear altogether.

2. More transparency for consumers

The Second Payment Services Directive must be implemented in the UK by 13 January 2018. Under this directive, banks will be required to open their account interfaces to new payment apps. As a result, there will be opportunities for FinTech companies to partner with banks to create more exciting customer experiences and provide increased transparency on performance and fee structures. The intention is to encourage competition and create greater choice for consumers, but it may also lead to an additional element of risk, as consumers may have to ask themselves whether the payment app they are using is really legitimate.

3. Security will become even more important

The increased activity in the FinTech sector has created fresh fraud risks and, in 2016, we saw data breaches in government departments and retailers (most notably Tesco Bank and Three) alike. This has led to an increased demand for security offerings. Any FinTech start-up must now have security as a major factor in its software development. The Bank of England announced at the end of last year that it is working with FinTech firms to work on ways to combat fraud.

4. Blockchain technology will become mainstream

Blockchain, which offers a safer and cheaper solution to money transfers, is set to gain more traction this year. Blockchain was the breakthrough technology of 2016 and led to the rise of cryptocurrencies like Bitcoin and a raft of new FinTech start-ups and platforms. The technology consists of blocks that hold timestamped batches of recent valid transactions, which form a chain, with each block reinforcing those preceding it. In 2017, blockchain is likely to expand beyond FinTech and cryptocurrencies and into the realms of property transactions, FX trading and music streaming services.

5. Increased investment and innovation in Africa

While mobile phones are now thought to be as common in South Africa and Nigeria as they are in the United States, relatively few mobile payments take place in Africa. This is because the majority of people in Africa do not have bank accounts and over 90 per cent of payments are made in cash.

We predict that FinTech companies will look to target Africa and other emerging markets over the course of this year. As most countries in Africa have never built a credit card infrastructure, FinTech companies have the opportunity to bypass typical card payment models and provide financial services to millions of consumers who previously have not had access to bank accounts. Some FinTech start-ups have already sought to take advantage of this largely untapped market, including: Nomanini, a South Africa-based payments provider that enables transactions in the cash-based informal retail sector; BitPesa, a Kenya-based foreign exchange company that converts bitcoins into local African currencies; and Zeepay, a Ghanaian mobile payments company.

6. A fight for talent

The rising demand for new innovative technology means that banks and FinTech companies are likely to ramp up their efforts to recruit people with the right skills and a strong understanding of financial products. There will no doubt be a battle for those with expertise in artificial intelligence, robotics, machine learning and cybersecurity.