We often explore how fintechs are changing the banking and payments landscapes, and sometimes look into how their solutions are supporting financial inclusion and helping people develop healthy financial habits. But to kick off 2025, we’re placing a focus on ‘fintech for good’ to find out exactly how much impact fintechs are having – both positively and negatively.
So far this month, Tech Finance Daily has focused on ‘fintechs for good’, delving into whether all fintechs have a responsibility to make a positive impact on society, as well as what it is that sets a true ‘fintech for good’ apart from the rest.
However, becoming a fintech that genuinely does ‘good’ is far more complex than simply deciding to do so. There are a wide range of challenges involved in the process of doing good. To find out just how difficult it is, we reached out to industry experts to ask them what they think the biggest challenges are.
Embedding social impact into your business
“When the market is challenging, investors are pushing for returns, and the Board is focused on profits, how does a fintech maintain its focus on social impact?” asks Thekla Paschali, CTO at payabl., a European financial services provider. “The answer lies in embedding a positive social impact into everything that they do.
“The reality is that to deliver a positive and measurable social impact, it’s not about priority. This isn’t an item on a checklist or an agenda. It’s not a CSR initiative that sits outside the bounds of everyday business function. It’s not a special project or working group.
“Social impact must be weaved into the fabric of a business. It’s culture. It’s DNA. It’s who you are and what you stand for.”
“One major challenge is scaling inclusivity while maintaining profitability,” explains Sergiy Fitsak, managing director at Softjourn, a full-cycle software development company. “Fintechs must navigate regulatory frameworks that often lag behind innovation, ensuring compliance without compromising accessibility.
“Additionally, data privacy and ethical AI deployment remain critical, as financial tools must empower users without exploiting them. Collaboration with governments and NGOs can help fintechs expand their reach responsibly and effectively.”
Staying true to your mission
Wendy Murphy, VP of corporate communications at financial boutique Exinity, says the biggest challenge for fintechs looking to ensure they make a positive social impact is “staying accountable to shareholders”.
“Even when everyone is on the same page regarding being a force for good, this belief may waver if the company is facing tricky financial times and shareholders are out of pocket and beginning to feel the pinch. It’s at those times that fintech companies may face another challenge – remaining true to the mission of being a force for good. This is especially true if a marketplace seems to be offering more lucrative, less society-positive ways of turning a profit.
“Fintech companies also need to be aware of, and realistic to, the fact that they need to run as a business to survive – and they may be competing against others with far fewer scruples than them. So, they’ll need to have a contingency plan for this. To make a truly positive societal impact that reaches beyond their immediate client base and inspires others by becoming change-makers, they need to be big enough or have the right contacts to make a noise that will truly count.”
Staying focused on doing good
“Creating positive social impact isn’t without its difficulties, and fintechs need to confront these problems head-on,” says Jayne Sibley, CEO of Sibstar, the debit card and app for financially vulnerable people. “Financially vulnerable populations often face barriers such as a lack of financial education, access to technology, or even basic trust in financial systems. Fintechs need to design inclusive products that are easy to use and accessible to everyone, not just the tech-savvy or privileged few.
“Regulation has always posed challenges. Fintechs operate in a fast-moving environment, but social impact often intersects with time-consuming areas such as consumer protection and data privacy. Navigating these regulatory processes while maintaining flexibility and innovation requires constant vigilance and adaptability.
“Fintechs need to focus on building and sustaining trust. Social impact is a long game, and customers need to see consistency and authenticity before buying in. This means proving that the company’s values are more than just marketing.
“At Sibstar, we’ve overcome many of these challenges by staying focused on our mission to support financially vulnerable individuals, ensuring that our technology consistently prioritises and serves their needs.”
Cybersecurity challenges
Elena Bazhenova, payment specialist at Exactly, a payment solution provider offering international support and a range of fintech services, explains that cybersecurity and keeping customer data safe will be one of the biggest challenges for fintechs looking to make a positive social impact.
“In addition to increasingly fiercer competition, fintechs are facing a range of new challenges, particularly rising cybersecurity threats and breaches targeting both personal and business data. In 2023, the finance sector experienced the highest number of breaches, highlighting the risks fintechs face. These companies should consider not only the lucrative financial gains hackers pursue but also the sensitive information that could be compromised during an attack.
“With artificial intelligence making it easier to develop malware, maintaining a strong cybersecurity posture is essential to avoid falling victim to cyberattacks. Additionally, fintechs must also navigate the increasing complexity of evolving regulatory requirements. While bracing for a potential surge in AI-driven breaches, it is crucial to prioritise secure technology and regularly update systems to ensure compliance with regulations. Another significant challenge is implementing sustainable practices and commitment to financial inclusion.
“While the potential of financial inclusion is significant, expanding into underserved areas presents barriers such as financial illiteracy and limited access to technology. Addressing these obstacles will be critical to making real progress and ensuring that fintechs have a positive, lasting impact.”
Bridging the accessibility gap
“To achieve positive social impact, fintechs must overcome several challenges,” adds Deep Varma, chief technology officer at Alkami. “One of the most pressing is bridging the accessibility gap. While technology has the potential to democratise financial services, many underserved populations still face barriers such as limited digital infrastructure, financial literacy, or internet access. Ensuring these groups can fully participate in the digital economy is essential to creating an inclusive financial ecosystem.
“Investing in financial wellness to drive inclusion and literacy is another challenge to overcome, and this needs to be an underlying value system to uplift societies.
“Another challenge is balancing profit and purpose. Fintechs often face pressure to deliver shareholder returns, which can conflict with the long-term investments needed to drive social impact. At the same time, data security and privacy have become paramount as these companies empower users to take control of their financial needs and data. Without adequate safeguards, breaches or misuse can harm consumers and businesses.
“Additionally, navigating regulatory complexity can hinder efforts to scale impact, particularly across regions with diverse legal frameworks. Compliance must be achieved without stifling innovation. Lastly, building trust and accountability through transparency and ethical practices is essential to meeting the expectations of consumers and regulators alike. Fintechs that address these challenges with a steadfast commitment to serving communities will be well-positioned to create lasting social impact and foster a more inclusive financial future.”
Enabling socially positive investment
Matthieu Maurin, CEO and founder of Iceberg Data Lab, says: “The transition means new business models and technology, which requires investment in new models and expertise to understand them (for instance, what are the externalities and therefore the net impact of hydrogen or of batteries?). That means that the budgets to develop that ESG expertise should steeply increase in the coming years.
“That will be possible only through efficiency gains from more mature cost centers at financial institutions, like the cost of financial data, which should be rationalised, provided by open source data hubs, and free, leveraging on public repository of financial reportings and rolling standards such as the xbrl format. Economical rent from incumbents selling financial data should be eliminated to let room for much-needed investments into climate, nature and social data that our economy needs now.”
Social impact challenges
Finally, Sameer Goyal, head of engineering, BEAT, at Acuity Knowledge Partners, briefly outlines the wide range of challenges that fintechs must consider if they are going to do their part in increasing inclusion, supporting underserved communities or continue towards the fight against climate change.
“Fintechs aiming for positive social impact face several challenges:
- Data privacy and security: Protecting user data is crucial.
- Financial inclusion: Reaching underserved populations requires innovation. A company in Kenya has successfully provided mobile banking to millions, but scaling globally is challenging.
- Sustainability: Balancing growth with environmental sustainability can be tricky.
- Trust and transparency: Building and maintaining trust through transparent practices is essential.
- Access to funding: Securing funding for fintechs focused on social good can be challenging, as investors may prioritise profits over impact.”
