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Global Fintech Market (2018 – 2023)

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The global fintech market is expected to expand at a CAGR of xx% during the 2018-2023 period, and reach a value of USD xx Bn by 2023. – PowerPoint PPT presentation

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Title: Global Fintech Market (2018 – 2023)


1
Global Fintech Market (2018 2023)
  • April 20192019

2
Key Questions Answered in this Report
  • What is Covered?
  • What is the historical, current, and forecasted
    market size data for the global fintech market
    for the segments based on services and
    technology?
  • What is the historical, current and forecasted
    regional (North America, Europe, Asia-Pacific,
    Latin America, and the Middle East and Africa)
    market size data for the global fintech market?
  • What are the regulations and initiatives in the
    fintech market in the different segments?
  • What are the major drivers and challenges
    impacting the fintech market?
  • What are the market trends and significant
    technological developments in the market?
  • What is the competitive landscape, along with the
    profiles of the major public and private players
    operating in the market?
  • What you get Impact
  • Understand the demand for fintech for specific
    applications, in order to determine the viability
    of the business.
  • Identify the developed and emerging markets where
    fintech is consumed.
  • Determine optimal product positioning, and
    identify suitable distribution channels.
  • Identify the gap areas and address them.
  • Develop strategies based on industry standards
    and economic factors for the segments.
  • Define competitive positioning by comparing the
    products and services with other key players in
    the market.

3
Market Definition
  • Payment/billing generates the highest revenue in
    the fintech market, followed by mortgage/real
    estate, money transfer/remittance, regtech, and
    insurtech. Others include lending, public
    finance, capital market, wealth management, and
    others.
  • Based on Services
  • Payments/Transactions This refers to enterprises
    whose business models involve the use of
    technology to offer services, and/or whose core
    businesses are based on the distributed ledger
    (Blockchain) technology or the usage of
    cryptocurrency (e.g. Bitcoin) for payments.
  • Personal finance This refers to companies that
    offer technology-driven services to enhance
    retail customers' finances by assisting them to
    monitor savings, credit scores, spending, or tax
    liabilities. Fintech is used to offer retail
    banking services such as checking savings account
    balance outside the traditional brick and mortar
    bank branch.
  • Insurtech This refers to companies employing
    technology to boost promptness, competence,
    accuracy, and convenience of processes across the
    insurance value chain. This includes insurance
    telematics, quote comparison websites, insurance
    domestics (home automation), corporate platforms,
    claims software, online brokers, cyber insurance,
    peer-to-peer insurance, underwriting software,
    and digital sales enabling.
  • Regtech This refers to companies that offer
    technology-driven solutions to expedite and
    streamline compliance with reporting and
    regulations, as well as safeguards enterprises
    from employee and customer fraudulent cases.
  • Based on Technology
  • Blockchain/Cryptocurrency Cryptocurrency is a
    virtual medium of exchange, created and kept
    electronically in Blockchain, distinct from other
    currencies. Cryptographic technology is used to
    decentralize the securely verified transactions
    and creation of monetary units.
  • Robotic process automation (RPA) RPA enables
    banks and other financial institutions to control
    data, process transactions, trigger responses,
    and communicate with other systems.
  • Artificial Intelligence (AI) AI uses data
    science and machine learning to develop
    personalized products for consumers.
  • Data analytics Predictive analytics can help
    fintech companies provide customers with an
    individualized experience.

4
Executive Summary
Global FINTECH Market
  • Overview
  • The global fintech market is expected to expand
    at a CAGR of xx during the 2018-2023 period, and
    reach a value of USD xx Bn by 2023.
  • Investments in the regtech and insurtech markets
    are expected to surge massively in the coming six
    months, in addition to substantial funding for
    facilitating technologies like Blockchain, AI,
    and RPA.
  • Trends
  • AI and Blockchain are expected to be priorities
    for fintech investors, followed by insurtech and
    regtech, during the forecast period (2018-2023).
  • Factors such as rise in competition among new
    entrants, and growing global consensus on
    reducing remittance transaction fees are driving
    the penetration of digital channels.
  • Fintech companies in the remittance market
    segment have been experiencing remarkable
    progress since the past few years. Due to growing
    awareness about money transfer, remittance
    through fintech solutions has increased.

Global Fintech Revenue (in USD Bn)
CAGR xx
  • Drivers
  • The boom in the e-commerce sector has driven the
    use of online payments and e-wallets, all over
    the world.
  • Increasing demand for cryptocurrency has
    decreased the cost of transactions, and initial
    coin offerings (ICO), which is driving the
    fintech market.
  • Due to the rising need to eliminate fraud and
    crime in the financial sector, dependency on
    outdated software and paperwork has decreased,
    and the adoption of fintech-based solutions by
    the financial companies has increased.
  • Challenges
  • Uncertain regulatory principles and frameworks,
    and lack of diverse Blockchain applications and
    use cases are expected to delay the growth of the
    market during the forecast period.
  • Fintech firms are failing to keep up with the
    traditional financial companies because of the
    lack of human touch. Their functional models
    often leave clients feeling like they are dealing
    with some faceless entity.

Source Netscribes Analysis
5
Market Drivers and Challenges
The infiltration of mobile devices and
technology-based solutions across regions is
propelling growth of the global fintech market.
However, regulatory and compliance challenges
continue to hinder its growth.
  • Key Drivers
  • Significant use of mobile devices and
    technology-based solutions are increasing the
    demand for financial and banking solutions, which
    can be accessed through personal devices. Banks
    and firms are investing heavily in
    technology-based solutions.
  • The cost of compliance has increased for global
    institutions, since they now need to comply with
    regulatory norms across jurisdictions. The
    mounting cost of compliance has compelled many
    corporates to invest in regtech companies. The
    advent of financial regulations including Payment
    Services Directive 2 (PSD2), General Data
    Protection Regulation (GDPR), and Markets in
    Financial Instruments Directive II/Markets in
    Financial Instruments Regulation (MiFID II/MIFIR)
    have accelerated the investment in the last six
    months.
  • The boom in the e-commerce sector has propelled
    the use of online payment methods and e-wallets,
    across the world. Enterprises, as well as
    individuals are trusting fintech companies with
    their data to transfer funds, make purchases
    online through e-commerce websites, and use
    e-wallets.
  • Challenges
  • One of the significant disruptions for the United
    Kingdom (UK) fintech is the introduction of GDPR.
    Financial firms, both old and new, have to invest
    substantial time and resources to certify that
    they comply with the new laws.
  • Fending off cyber-attacks is one of the paramount
    challenges faced by firms and governments, all
    over the world. Given the complex nature of the
    client data that companies store, this is a
    severe concern for fintech firms. Cybercriminals
    are hurling more frequent and sophisticated
    attacks. It is quite evident, owing to the fact
    that the number of data breaches had amplified in
    2018.
  • Fintech firms are lagging behind when compared to
    traditional financial companies. They lack in
    human touch. Their functional models often
    leave clients feeling like they are dealing with
    a faceless entity.

6
Global Fintech Ecosystem Players and Clientele
  • Fintech clientele
  • Individuals
  • Individual demand for fintech services is driven
    by rapid urbanization, mobile and Internet
    penetration, and ease of use. In established
    regions with high banking penetration, tech-savvy
    consumers are demand for a wide range of
    services, and better experience. In emerging
    markets, fintech firms are helping in enabling
    financial inclusion.
  • Corporations and Small and Medium-sized
    Enterprises (SMEs)
  • Limited financial history and other challenges
    leave SMEs underserved when it comes to acquiring
    financial benefits from traditional institutes.
    This unmet demand presents an opportunity for
    fintech companies. The digitalization of the
    lending process, including the assessment of
    credit risk, is providing SMEs with an
    alternative way of funding.
  • Financial Institutes
  • Across regions, banks are collaborating and
    investing in fintech companies to drive
    efficiency, offer new products, and improve
    customer experience. The aim is to incorporate
    fintech solutions across the value chain.
  • Governments and Regulators
  • Regulators are also collaborating with fintech
    firms and leveraging their capabilities to
    improve their processes.

Fintech Ecosystem
Players in the Fintech Ecosystem
Educational Institutions
Consumers
Financial Institutions
Regulators
Start-ups
Investors
Fintech companies
Robo-advisors and Personal Finance
RegTech
Payments and Remittances
Digital Banking
Insurtechs
Alternative Finance
Blockchain/DLT and Bitcoin
Digital Identity Verification
Note The start-ups and segments covered in the
Fintech Ecosystem are not exhaustive but
indicative only.
7
Global Fintech Market Regulations and
Government Initiatives
Initiatives undertaken by governments to
encourage fintech companies
  • To remain competitive and offer an environment
    that sanctions new initiatives, globally, firms
    are looking into enterprises with regards to open
    banking, which allow fintech firms to leverage on
    banks data to provide and extend their offerings
    to bank customers.
  • Regulators are undertaking various approaches to
    provide regulatory oversight with the aim to
    protect consumers, and at the same time make the
    effort not to deter innovation.
  • Various countries have adopted sandboxes to
    provide fintech firms with an environment to
    evolve and innovate. These fintech companies are
    able to launch products and services without the
    necessary licenses, which also allow regulators
    to have constant consultations with companies to
    gain a better understanding of the sector
  • Some countries have created special economic
    zones to set up firms focused on innovation.
    Specific zones may be subjected to various
    regulations including lower taxes, permission to
    operate without necessary licenses (or with
    special licenses), etc.
  • Regulators have been running consultations with
    industry players to understand the current
    industry scenario, and try to identify the
    necessary steps that need to be undertaken to
    protect the consumers while encouraging
    innovation
  • Regulators of certain economies have successfully
    implemented guiding principles to enable fintech
    growth
  • Countries have also rolled-out fintech related
    laws or licenses, allowing these firms to operate
    in the region without the requirement of a
    banking license
  • Given the complexity of the fintech ecosystem and
    the existence of different guidelines across
    different countries, fintech industry
    associations and financial regulators are
    collaborating, globally, with the aim to share
    leading practices, experiences, and frameworks,
    thereby enabling the growth of fintech firms in
    different markets.
  • To improve collaboration among regulators, the
    Global Financial Innovation Network (GFIN) was
    launched in August 2018 by 12 financial
    regulators. The network assisted innovative
    companies to interact efficiently with the
    regulators and originate new ideas. They would
    also create a new framework for cooperation among
    the financial services regulators on innovative
    topics.
  • Given the potential and opportunities associated
    with the fintech industry, regulators and
    policymakers across the world are focusing on
    developing more functional fintech ecosystems
    through a range of policies and other
    interventions. Emerging economies are also
    encouraging investments in this industry, and
    trying to bring in frameworks that ensure a
    fintech-friendly environment.

8
Market Overview
The North American fintech market has been
experiencing considerable growth lately, and is
expected to expand at a CAGR of xx during the
2018-2023 period to reach a value of USD 80.8 Bn
by 2023. This region is going to continue
attracting investors, owing to top notch
technology infrastructure and organized
regulatory sandbox.
  • North America Fintech Market Revenue (USD Bn),
    2015-2023F
  • North America Fintech Market USD xx Bn (2018)
  • Market Trends
  • In general a mature market, North America
    currently accounts for xx of the global fintech
    market share. This region has been witnessing
    continued growth driven by investments,
    particularly in 2018, with the US recording a
    5-year high on the back of 25 mega-rounds worth
    USD xx Bn.
  • This region is also home to the maximum fintech
    start-ups with unicorn status. This region also
    witnessed fintech companies diversifying their
    current services. Banking-as-a-service (BaaS)
    platforms are facilitating fintech companies in
    the US to increase the number of bank accounts.
    Such diversification is expected to propel growth
    in the region.
  • Given the opportunities, North America is
    anticipated to continue attracting investors.
    However, the recent investment trend indicates
    that investors are finding other regions more
    lucrative, and hence, North America is no longer
    powering the global fintech funding growth. This
    can lead to a slowdown of the overall fintech
    market growth in the region during the forecast
    period (2018-2023).

Source Netscribes Analysis
Source Netscribes Analysis
9
Company Overview
Overview Key Investors Overview Key Investors
Description -Robinhood is headquartered in California, USA. Baiju Bhatt and Vlad Tenev founded the company in 2013. It is a stock brokerage company that offers mobile app services. It allows users to invest in publicly traded companies, ETFs listed on the US stock exchange, and cryptocurrencies, without paying any commission. Founded in - 2013 Headquarters - California, USA Number of employees 501-1000 Website- www.robinhood.com Industry Finance and Insurance Sequoia Capital Kleiner Perkins ICONIQ Capital DST Global Products/Services Investing The mobile-based app helps users invest in stocks, ETFs, options, and cryptocurrency without the need of a manual. Strategize and Execute Robinhood provides multi-leg options strategies for advanced traders. It analyzes candlestick charts, and trades on margin to enhance buying power. Cash Management It is yet to be launched by the company. Description - Ant Financial is headquartered in Hangzhou, China. The company was previously known as Alipay (part of Alibaba Group), but was rebranded as Ant Financial Services in 2014. Among the fintech companies all over the world, Ant Financial is one of the most valuable unicorn companies with a valuation of USD 150 Bn. Founded in - 2014 Headquarters - China Number of employees 5001-10000 Website - www.antfinancial.com Industry - Personal finance, Software China Investment Corporation China Construction Bank China Development Industrial Bank Products/Services Ant Financial offers an extensive range of financial services to individuals, as well as small and micro businesses, using technology such as Blockchain, AI, big data, cloud computing, and the Internet of Things (IoT). It has developed online platforms to deliver a wide array of products and solutions, covering payments, third-party insurance, loans, and wealth management that emphasize the financial requirements of small businesses, and individuals. The cloud and big data analytics direct their credit, security, and risk control processes, allowing them to offer tailor-made products.
Key People Key Initiatives Key People Key Initiatives
At the beginning of 2018, the CEO of Robinhood announced that the company is on its way to create initial public offering (IPO). Free trading option, and free cryptocurrency trading are vital factors that have contributed to the companys growth, and helped it become a millennial-friendly brokerage firm. In 2017, its customer base accounted for 4 Mn. 2015 Koubei was created as a result of a joint venture between Alibaba and Ant Financial. Ant Financial also launched Ant Fortune, which offers hundreds of products from about 80 Chinese fund institutions. 2017 Ant Financial introduced its facial recognition payment technology through its Alipay services. Fortune Account service platform was also launched. It allowed financial institutions to issue content and trade their own financial products through the platform.
Vladimir Tenev Co-founder
Eric Jing Chairman and CEO
Baiju Bhatt Co-founder
Simon Hu President
Li Cheng CTO, and International Business Groups
COO
10
Appendix
  • Research Methodology

Reporting The analyst then creates a report with
the support of his findings and analysis, with
help from an editorial team.
Problem identification The analyst identifies
key questions that he/she would like to address
from the market study. He/she describes the
major challenges that would help clients
understanding the industry, globally, or for a
specific region.
Defining objectives The analyst then defines the
research objectives and methodologies which form
the basis of the research.
Information gathering The next stage of research
is conducted utilizing secondary and primary
sources of information. They conduct an in-depth
study of the global market, identifying and
understanding its key stakeholders, drivers,
trends, challenges, and opportunities, covering
major regions such as North America, Latin
America, Europe, Asia-Pacific, and the Middle
East and Africa. Primary research complements
the secondary research, as and when required, as
it helps gain insights from the industries
directly, by communicating with senior
executives, key opinion leaders, and independent
consultants who are experts in their industries,
or specific industry sectors.
Analysis The qualitative and quantitative
findings from the previous stages are brought
together by specialists to perform a rigorous
analysis. The regional market trends, drivers,
and opportunities obtained during the analysis
are compared with regional economic indicators,
sector growth rates, population index, etc., to
ensure consistency of the data. After consistency
is ensured, these historical and present
indicators help to understand how the market will
perform in the future. The proprietary
forecasting model factors in all these indicators
to predict the future market accurately.
11
Appendix
  • About Research On Global Markets
  • Owned by Netscribes, Research On Global Markets
    is the go-to platform for global professionals
    looking for credible and transparent research on
    developed and emerging markets. We set ourselves
    apart from other online market research
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  • Research On Global Markets (ROGM) is a
    comprehensive source for syndicated market
    research reports on various emerging, high-growth
    sectors across the globe. The reports provide
    detailed analysis, with reliable market data and
    information, including global macroeconomic
    trends, market size, growth forecasts,
    competitive landscape, and market share analysis
    across more than 200 countries.
  • Research On Global Markets draws from the
    companys vast experience in market research and
    intelligence. It provides tactical and actionable
    insights to clients, and enables effective
    decision-making and strategic implementation.

12
Disclaimer
This report is prepared by Research On Global
Markets ("ROGM"), a brand owned by Netscribes
(India) Private Limited (Netscribes). The
content of this report is developed in accordance
with ROGMs professional standards. Accordingly,
the information provided herein has been obtained
from sources which are reasonably believed to be
reliable. All information provided in this report
is on an as-is" and an "as-available basis, and
no representations are made about the
completeness, veracity, reliability, accuracy, or
suitability of its content for any purpose
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projections, forecasts, or statements relating to
expectations regarding future events represent
ROGMs own assessment and interpretation of
information available to it. All liabilities,
however arising, in each of the foregoing
respects are expressly disclaimed. This report
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purchase or subscribe for securities, or a
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abstain from purchasing, any securities. This
report is not intended to be used as a basis for
making an investment in securities. This report
does not form a fiduciary relationship or
constitute investment advice. Nothing in this
report constitutes legal advice. The information
and opinions contained in this report are
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subject to change. Reports may or may not be
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