How Fintech is Revolutionizing the Music Industry: Key Trends & Technologies

Did you ever imagine back in 2007, while riding your bike with a small mp3 player in your pocket, that in ten years you’d have access to any song in the cloud—anywhere and on any device?

Similarly, who would have guessed you’d be able to pay for a public transport ticket without carrying a payment card or entering a PIN? Or that after dinner with friends, you could split the bill in just a minute using an app?

Both industries – fintech and music – have undergone an unprecedented revolution over the past decade or so. Although they might seem unrelated at first, they have arguably cemented and normalized the use of technology in our daily lives, especially on mobile devices. And interestingly, they are increasingly working for mutual benefit.

This article focuses on methods of utilizing fintech features in the music industry to increase income and gain better control over revenues from various sources.

You don’t need to play it by ear – our tips will help you strike a chord with the users of your music solution.

What has changed in the music industry?

A lot has changed in recent years in the music industry. Fintech can help all the parties involved—from artists, through record labels, to creators that use music in their content or streams— face challenges related to these shifts.

Streaming dominance and revenue restructuring

Streaming platforms like Spotify and Apple Music have dominated the market with their subscription model. Their revenue model forced artists, record labels, and distributors to completely rethink the structure of income channels.

Shift from physical sales to digital

Physical records have become largely irrelevant as the focus has shifted from album sales to individual songs and their viral potential. Social media has become vital for music promotion—empowering artists to manage their image and marketing, but also making them dependent on algorithms.

The rise of social media and technology

Today, new bands rarely make it big without leveraging social media. Consider this scale: 84% of songs that entered the Billboard Global 200 in 2024 went viral on TikTok first. Algorithms increasingly dictate artists’ futures, yet listeners are becoming more aware of these dynamics and the revenue challenges that accompany them. Intentional streaming is on the rise, alongside more participative models of artist support.

Additionally, generative AI in music industry is opening new possibilities for artists, making them far more self-sufficient with the open access to GPT-4 and other advanced models for creatives. At the same time, personalized spatial audio is making waves, enforcing changes in production and platform’s approach to quality.

Many changes? Without a doubt – but worry not. Many of them are much easier to handle with fintech tools.

Where do fintech and the music industry cross paths?

There are multiple ways in which fintech and music industries can merge, supporting each other. Many of them remain yet unexplored by big industry players, but that may change soon. Here are the issues fintech can help music industry solve.

Battling low streaming payouts

Artists today have virtually unlimited access to audiences in the music business, yet they face a major challenge: low streaming payouts in music. If you’re not one of the many artists with millions of music streams, the revenue models of streaming platforms rarely fill your pockets with cash.

Innovative revenue models are essential for artist development in the music industry, and fintech solutions can implement them without limitations. These advancements also promote financial literacy among independent musicians, helping them understand modern revenue streams in music.

Breaking down barriers between artists and fans

Key to driving alternative income channels in music is breaking down the barriers between the artist and the audience. Fintech has the potential to enable direct artist-fan financial interactions, making payments as seamless and enjoyable as possible. This approach benefits the music business by fostering a closer connection between many artists and their fans.

Moreover, with fintech, features such as instant payments and real-time transaction tracking can improve credit scores and support artist development for emerging music talent. In the end, we are in the music entertainment business, so creating “joy” in every music transaction is critical for every next album release.

Some platforms make it much easier than others to put down barriers and create a compelling experience. For instance, Bandcamp enables artists and labels to create personalized storefronts that aligns with their image and strengthens the emotional impact, translating into sales.

Simplifying revenue tracking for independent musicians

With numerous revenue sources in music, tracking payouts can become complicated—especially for independent musicians who lack a full backstage team. Fintech software development solutions are designed to streamline the process of tracking and collecting income from various channels, whether it’s earnings from streams on platforms like Twitch or payments from music streaming services.

By centralizing income data, these solutions empower many artists to focus on creative music production and artist development without worrying about financial complexity in the music business.

The platforms that enable such a holistic approach to building music careers and claiming revenues are already making waves in the industry – take GYROstream or VIRPP. However, there is still a lot to be done in terms of facilitating payments and covering all the scope of the music revenue channels.

If you have an idea how to embrace these niches, we may help bringing it into reality with our extensive experience in both fintech and music industry. Benefit from the experience we collected while collaborating with music leaders like Abbey Road Studios or Dolby, as well as our fintech expertise coming from working with Nextbank, Avivaor BNP Paribas.

Preventing scams in event tickets and live events

In a world where event tickets for live events by the biggest music stars sell out in seconds—and often at exorbitant prices—the conditions are perfect for scammers. Fraudsters target fans with fake event tickets and fraudulent live events promotions, exploiting the high demand in music.

Fintech offers decentralized and transparent financial solutions that help prevent scam activities, ensuring secure transactions in the music and live events sectors. This is especially important for many artists and their fans, who depend on reliable systems to secure authentic music experiences and purchase genuine event tickets.

By leveraging fintech innovations, the music business can enhance artist development, improve financial literacy for emerging talent, and create a safer, more transparent ecosystem for music, live events, and even the sale of event tickets.

Ultimately, these solutions help independent artists focus on their passion for music while ensuring that every fan’s journey to a live event remains joyful and scam-free.

New revenue streams for artists with fintech tools

You can use fintech resources to enhance engagement, safety, and income in various ways. Some of these solutions are already well rooted in the music industry, while others are starting to make waves.

Embedded finance in streaming platforms and streaming apps

The potential of embedded finance is evident: just in 2023, this particular sector generated an estimated €20 billion to €30 billion in Europe, which was about 3 percent of total banking revenues. In music industry, embedded finance powers new income channels, facilitating the monetization among fans.

Heavily dependent on streaming apps for their income, artists have little room to maneuver. However, Spotify and other market giants are recognizing their needs. In recent years, they have significantly expanded their embedded finance features, enabling seamless in-app purchases for music, merchandise, and experiences.

The social media platforms critical for the music industry, like Instagram and TikTok, offer embedded payments options such as Shop Pay integration (collaboration with Shopify) or payments in chat. However, musicians and labels have various different options of embedding payment through third-party integrations.

The key is to ensure compliance with platform’s policies and prioritize user security – something an experienced music application development partner can help with.

Fintech-powered superfan monetization

Fintech tools enable musicians to implement superfan monetization strategies with seamless payment processing. Subscription-based platforms allow fans to receive behind-the-scenes videos, early song snippets, or private Q&A sessions with automatic recurring payments.

Instead of a traditional album drop, fintech solutions make it easy for artists to distribute exclusive digital content, deepening fan engagement while ensuring a steady income stream.

Do you know that Billie Eillish, a global superstar, was first discovered on SoundCloud and it’s there where she started building her fanbase? The campaign she recently carried out with the platform is a creative example of music monetization strategies.

As a part of organized takeover of SoundCloud, a unique page was created, providing early access to the new, yet unreleased third studio album to her first 50 fans and enabling others to engage with the songs before their release.

NFT-based fan engagement

Tokenized fan engagement is another breakthrough powered by fintech. Blockchain-based NFT rewards can function as digital passes—giving fans a stake in streaming royalties while providing special perks like members-only chats or direct interactions with the artist.

Instead of relying on outdated revenue models, fintech platforms allow musicians to issue and manage limited-edition tokens, automatically distributing streaming income and unlocking VIP experiences for superfans.

Although the NFT craze is over, the non-fungible tokens can serve as a handy and secure tool for powering engagement and democratizing artist funding. Think of The Chainsmokers who distributed 5,000 NFTs to fans when releasing their album in 2022.

These tokens granted holders a share in 1% of the album’s streaming royalties, along with perks like exclusive access to a members-only section of their Discord channel and opportunities for direct interaction with the duo.

Crowdfunding and tipping with instant transactions

Fintech-driven crowdfunding and tipping platforms empower fans to support artists directly. With integrated payment solutions, every live stream or exclusive release can trigger automatic microtransactions.

Artists can receive real-time payments for views, comments, and interactions, turning passive streaming into an active revenue channel.

Although so far the crowdfunding solutions are mainly adopted by the podcast creators, music industry has been slowly absorbing it. Most platforms enable musicians to set tipping limits or offer a subscription model, with automated payments per every release or per month.

In the next years, we may see crowdfunding solutions get increasingly popular and embedding options expand in social media and streaming apps. It is very likely that the future of music streaming will be much more participatory and based on close-knit relationships between the artists and their fans.

Blockchain-based streaming for fairer payouts

The current streaming giants are straining under unsustainable models. In 2024, Spotify paid over $10 billion in royalties—more than 60% of its €15.7 billion revenue—but only around 4% of artists earn a sustainable income.

Fintech is at the forefront of alternative streaming models, addressing the inefficiencies of major platforms. Blockchain-based streaming services like Audius leverage decentralized payment processing to offer fairer revenue distribution. With smart contracts, artists receive a larger share of royalties instantly, eliminating delays and reducing dependency on traditional financial institutions.

Direct-to-fan monetization with automated payments

Direct-to-fan monetization is another fintech-powered solution. Platforms like Bandcamp and SoundCloud’s fan-powered royalties use embedded payment tools to support pay-per-stream or hybrid subscription models.

These systems allow artists to bypass outdated streaming contracts and secure income directly from their listeners, making monetization effortless and allowing artists to keep 100% of their royalties instead of only its fraction.

Smart licensing with automated payment systems

Music licensing has traditionally been a complex process, but fintech platforms now automate licensing agreements for businesses and content creators. For instance, a filmmaker seeking music for a project can use a fintech-enabled platform to browse available tracks, generate a licensing agreement, and process payment instantly. This automation reduces legal complexities while ensuring fair compensation for artists.

Instant micropayments for sync and commercial use

For independent musicians, fintech-powered licensing platforms streamline the process of monetizing their music and royalty management. These systems verify rights, calculate fees, and facilitate real-time micropayments, eliminating lengthy negotiations.

Artists receive immediate payouts, while content creators can legally access music with ease. By integrating automated licensing with fintech solutions, the music industry benefits from a frictionless, transparent, and financially sustainable ecosystem.

Blockchain for ticket sales and event monetization

Secure, tamper-proof ticketing to stop scalping

Fintech is reshaping event ticketing by eliminating fraud and price gouging. Blockchain-powered ticketing solutions, like those from GUTS Tickets, link tickets directly to buyers’ mobile devices. Barcodes are released just before events, making it nearly impossible for scalpers to resell or counterfeit them.

Fintech tools also regulate resale, ensuring tickets can only be transferred at face value through official platforms. This prevents price inflation and keeps events accessible to real fans.

NFT-based tickets with built-in resale royalties

NFT ticketing is taking event access to the next level. For instance, the Coachella Festival introduced NFT-based lifetime passes, giving fans not only festival entry but also exclusive perks. Although with the collapse of FTX, the future of these passes is now uncertain, this usage of NFTs can serve as a creative example of merging fintech and music.

Such NFT tickets can be safely resold, with smart contracts automatically directing a percentage of resale profits back to the festival organizers. This fintech-driven model ensures that artists and event organizers benefit from secondary sales rather than scalpers.

Direct-to-fan ticketing without middlemen

Fintech tools allow festivals to cut out third-party ticket sellers entirely. Tomorrowland implemented blockchain development ticketing to generate unique, fraud-proof passes. These tickets could only be resold through Tomorrowland’s official resale system, ensuring fair pricing and protecting fans from scams. This model empowers organizers to maintain control over ticket distribution while giving fans a secure purchasing experience.

Festival-specific crypto wallets for cashless payments

Blockchain-based digital wallets are also transforming event spending. Some festivals now integrate crypto wallets that allow attendees to pay for food, drinks, and merch using stablecoins or event-specific tokens. This eliminates the need for cash or traditional payment methods, speeding up transactions and reducing fraud. These wallets can also integrate with NFT tickets, creating an all-in-one fintech ecosystem for live events.

Blend fintech and music for higher revenues and better safety

​As the music industry grooves deeper into the digital age, hitting the high notes of innovation is essential to stay ahead of the curve. With our expertise, you can orchestrate success as a music entrepreneur—be it as a musician, label executive, or leader of a music tech ensemble.

Embedded finance integrations, blockchain solutions for better security and transparency, advanced AI-powered systems powering insights for better income from different streaming channels – these are only some of the ideas we can bring to live together.

Get in tune with fintech and discuss the potential innovations with us!

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