ExFAT and FAT32 are two types of file systems, but one of the major differences between the two is that FAT32 has been around for some time now, whereas exFAT is just a recent technology designed to improve on some of the limitations of FAT32.
Another major difference between the two is the maximum capacities of the two file systems. While exFAT has a maximum partition size of 64ZB, the maximum partition size of FAT32 is 16TB, though the recommended level for FAT32 is 32GB, while the recommended level for exFAT is 512TB. Another difference is their capacities to hold files.
A file of 4gb or more cannot be stored using FAT32. In contrast, exFAT can hold large files meaning it has a larger file size. One of the downsides of FAT32 is that when large files are stored in it, they will be broken down into fragments so they can fit. In contrast, exFAT doesn't resort to fragmentation of large files since it can create enough contiguous space for each file.