The financial technology (fintech) market is booming. According to the Global Fintech Market Research Report, this market was worth $127.66 billion in 2018. Experts expect it to grow to $324 billion by 2026, at a compound annual growth rate (CAGR) of around twenty-five percent.
16 May, 2022
The financial technology (fintech) market is booming. According to the Global Fintech Market Research Report, this market was worth $127.66 billion in 2018. Experts expect it to grow to $324 billion by 2026, at a compound annual growth rate (CAGR) of around twenty-five percent. Talk about an excellent industry to break into for any hard-working entrepreneurs!
There are many aspects to this hot, new market, including fintech design. In this article, we'll discuss fintech’s definition. We’ll also explore some of these newer companies’ offerings and the overall business outlook. But one thing is for sure, design is key to building trust in fintech.
Or, if you want to know what type of business your SaaS company could be, click here! For now, let’s dive into the world of fintech!
What Is Fintech?
Fintech uses technology to provide financial services, including mobile payments and peer-to-peer lending. Fintech companies are typically startups that aim to provide more efficient and convenient alternatives to traditional financial services.
Some standard services that fintech companies offer include:
Banking: online banking, mobile banking, and payments
Wealth management: Robo-advisors and investment apps
Lending and payments: peer-to-peer lending and mobile payments
Insurance: health insurance, property, and casualty insurance
Blockchain: cryptocurrency exchanges and smart contracts
There are several reasons why people are moving away from traditional banks to fintech for these services. For example, customers can access their accounts and make transactions from anywhere.
Fintech is also often more affordable than conventional financial services. And it is more transparent than traditional financial services, providing customers with a clear picture of their finances.
Fintech start-ups usually pay serious attention to fintech design, ensuring their applications are straightforward. Good design is key to building trust in fintech, which is fundamental in an industry that involves money.
It's also important to note that unlike owning a mobile phone, few people have the privilege of owning a bank account, a significant driver behind this industry’s growth.
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What Are Some of the Latest Fintech Companies?
Some of the latest fintech companies globally are in the United States. These companies have raised millions of dollars in funding and have valuations of billions of dollars.
Here is what some of them are doing:
SoFi: A personal finance company that offers student loan refinancing, mortgages, and personal loans. Currently, the company has a market cap of $6.08 billion. In May 2019, SoFi raised over $500 million in a single funding round.
Robinhood: A stock trading platform with no commission fees, it has raised over $5.6 billion in funding and is valued at $39 billion.
Betterment: An online investment platform with over $33 billion in assets under management. It has raised over $435 million in funding, and it was worth $800 million in 2017.
Acorns: A micro-investing platform that allows users to invest spare change, it has raised over $507 million in funding and has a valuation of $1.9 billion.
Stash: A financial services platform that offers investment, banking, and retirement products. It has raised over $425 million in funding and is worth two billion dollars.
Coinbase: A cryptocurrency exchange with over $223 billion in assets under management, it has raised above $550 million in funding, and its value is $86 billion.
The sheer sizes of these companies reflect how vast the fintech market is. Plus, these are just someof the many fintech companies out there. PayPal and Venmo are some examples, each with unique offerings and gigantic customer bases.
What Does the Future Look Like for Fintech?
The future looks bright for fintech. Experts expect the industry to continue increasing in the coming years. As we’ve already mentioned, the industry will be worth $324 billion by 2026.
One of the main reasons for this continued growth is the increasing number of unbanked or underbanked people. According to a report from the World Bank, 1.7 billion adults worldwide do not have a bank account.
Fintech companies have an extraordinary opportunity to provide these people with access to financial services. In addition, the increasing adoption of mobile devices and mobile commerce is also driving growth in the fintech industry.
So, check out fintech today! It’s never too soon to get into the next big thing.
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In 2024, the fintech market size will exceed $340 bn, and by 2032, this figure will increase almost fourfold and reach $1,152 bn. Such rapid growth will provide a staggering compound annual growth rate (CAGR) of 16.5% and will push the rise of new fintech sectors and banking services.
The global fintech market was valued at USD 294.74 billion in 2023 and is projected to be worth USD 340.10 billion in 2024 and reach USD 1,152.06 billion by 2032, exhibiting a CAGR of 16.5% during the forecast period (2024-2032).
The fintech industry is expected to reach a market size of $305 billion by 2025, growing at a CAGR of 22.17% from 2020 to 2025. The fintech sector, which currently holds a 2% share of the $12.5 trillion in global financial services revenue, is estimated to grow up to 7%, reaching $1.5 trillion by 2030.
Global fintech revenues have continued to grow at a robust clip: 14% over the past two years across the board, and 21% when crypto- and China-exposed fintechs are excluded. Perhaps more notably, the industry has initiated a shift toward profitable growth, with EBITDA margins improving by 9 percentage points on average.
05, 2023 (GLOBE NEWSWIRE) -- The global FinTech market size was valued at USD 257.26 billion in 2022 and is expected to reach USD 882.30 billion by 2030, exhibiting a CAGR of 17.0% over the study period.
The rapid expansion of fintech is empowering not just those in emerging economies but also in developed countries. By increasing access to financial services, supporting SMEs, and reaching remote communities, fintech is fostering economic development and financial inclusion.
The market size of artificial intelligence (AI) in fintech was estimated at 42.83 billion U.S. dollars in 2023, which grew to 44.08 billion U.S. dollars in 2024.
Robo-advisors, algorithmic trading, and AI-driven risk assessment are examples of how FinTech is leveraging technology to achieve unprecedented levels of efficiency. These advancements are in line with the objectives of Industry 4.0, which aims to automate and optimise processes through the use of smart technologies.
The promising Indian FinTech market is expected to reach $1 trillion in AUM and $200 billion in revenue by 2030. Indian FinTech ecosystem has emerged as a formidable global force and continues to grow as one of the largest FinTech markets globally.
The next big thing in fintech is likely to be the widespread adoption of Central Bank Digital Currencies (CBDCs), which promise to revolutionize traditional banking by offering state-backed digital currencies that streamline operations and enhance financial inclusivity.
Global investment in fintech sank to a five-year low of $113.7 billion across 4,547 deals in 2023 as investors pulled back from making large deals amidst concerns about stubbornly high interest rates, conflicts in Ukraine and the Middle East, falling fintech valuations, and the parched exit environment.
The global fintech as a service market size was estimated at USD 266.56 billion in 2022 and is expected to grow at a compound annual growth rate (CAGR) of 17.5% from 2023 to 2030.
Digital-first financial services based on collaboration
“Fintech and insurtech entrants are taking market share from slower adaptors,” said King. “Traditional and digital-first players will need to be part of a new collaborative ecosystem that includes embedded finance and payment players.”
Artificial Intelligence( AI) and Machine Learning (ML) integration are critical fintech trends. Industry experts expect it to shape the industry in 2025. These technologies can improve the efficiency, security, and personalization of financial services. They will drive big improvements in the customer experience.
North America accounted for a market value of USD 29.22 trillion in 2022. Business-to-Business (B2B) payments are the transfer of goods or services provided for a specific value in currency.
It's no secret that the United States has the best fintech ecosystem in the world, with the United Kingdom and Singapore trailing closely behind. Their winning combination of available talent, healthy competition, enabling regulations, and financial stability gives them an edge that's hard to beat.
Introduction: My name is Carlyn Walter, I am a lively, glamorous, healthy, clean, powerful, calm, combative person who loves writing and wants to share my knowledge and understanding with you.
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