Five Trends to Watch in Financial Services and Fintech in 2026

However, AI is far from the only thing to watch for in the coming year. Every new year brings new challenges and opportunities, and 2026 is shaping up to be no different. In my role leading Vestmark, it’s important to understand the forces shaping our industry. 

Here are the key trends I believe will define the industry in the coming year—and a few thoughts on the potential impact they could have. 

AI Will Continue to Increase its Impact 

If 2024 was a year of experimentation for AI in financial services firms, and 2025 saw its implementation, I believe 2026 will be the year we finally see its impact on a bigger stage. I anticipate this happening in three ways:

• First, in the automation of repeated, internal processes at wealth firms of all types. Any firm that doesn’t at least have a plan for automating standard processes will find itself lagging behind.
• Second, we’ll see AI being used to automate more complex processes like proposal generation, reporting and billing – anything that impedes advisors from spending time with clients. In addition, I believe we’ll see more interactions and integrations between autonomous AI systems to further enhance efficiencies.
• Third, we will see the rise of virtual employees in financial firms. I can say this because we are already starting to use these endlessly adaptable AI tools within Vestmark to boost our own efficiency with non-repeatable tasks. It requires supervision and guardrails, but what seems like science fiction is quickly becoming not only available, but essential to working faster and more efficiently. 

While financial services providers have a reputation for being slower to adopt technology compared to other industries, they are starting to catch up. As pioneers solve the issues around regulatory constraints and security – and they are being solved – we will enter a time in the next few years where those who fail to embrace AI risk being left behind and potential extinction.

Continued Expansion of Custom Investment Models 

Asset managers are increasingly moving toward custom investment models tailored to individual client needs. This trend is being driven in part by advisors and firms who want to show greater differentiation and value-add to clients, and in part by the fact that private markets and fixed income are becoming more easily combined with publicly listed securities in a single custodial account. 

Investors want to go beyond mutual funds and equities, and advisors and asset managers are anxious to meet that demand. As a result, more asset managers will look to provide custom models. This in turn could drive greater adoption of UMAs – a particular area of focus for Vestmark – since they improve efficient management across asset types.

Private Markets: Liquidity and Accessibility 

Feeding into those custom models will be an expansion of private markets and innovations that make them more available to more investors. Private markets have long been a cornerstone of diversification, but they aren’t suitable for all investors due to their (often) long-term horizons and their inherent lack of liquidity. 

Amplifying the growth of private markets (and other non-equity investments) is the current administration’s more favorable attitude towards including these types of investments in tax-advantaged retirement accounts. In 2026, we’ll see a push to provide more liquidity options for investors in private markets.

Blockchain’s Resurgence and Strategic Evolution 

A few years ago, blockchain use seemed to be stagnating. But now blockchain is making a comeback in financial services, moving beyond its experimental phase to become a reliable “source of truth.” I am intrigued by the major players now partnering with Web3 infrastructure companies to enhance the visibility and integration of private markets on the blockchain. 

Blockchain has the potential to revolutionize how financial instruments are managed and traded. By providing a transparent and immutable ledger, it builds trust and reduces inefficiencies. With the more favorable regulatory environment we are seeing take shape, blockchain could become a cornerstone of financial innovation. In 2026 we will continue to see the tokenization of more real world assets, particularly in the private markets space as distributed ledgers and smart contracts can be an elegant solution for semi-liquid funds. 

Market Consolidation in Fintech 

Finally, I anticipate significant consolidation in the fintech sector in 2026, with larger companies acquiring smaller, specialized firms. This trend is driven by strong markets, available capital, and the need for talent acquisition. AI is accelerating this process by enabling firms to integrate new technologies and deliver value more efficiently. 

Looking Ahead 

It’s a pivotal moment for the financial services and fintech industries. The trends described above, which I believe will be key themes in 2026 for our industry, are not just incremental changes. They could drive a fundamental shift in how we think about and deliver financial services. 

As we navigate these changes, one thing is clear: innovation is not optional. Companies will need to embrace these trends not only to thrive in the years to come but also, in certain cases, to survive. I couldn’t be more excited about what lies ahead. Let’s make 2026 a year of transformation and growth.