November 29, 2022
The fintech market is expanding due to a number of causes. The following are a few of the key industry forces behind the creation of innovative financial software:
A rise in the number of people managing their finances with fintech.
Increased technological use and digitization.
The growth of new kinds of businesses.
The expansion of digital financial services and the Internet.
Fintech has had a significant impact in emerging nations as well. The market has expanded as a result of the persistent and rapid economic growth in emerging nations. The number of Internet users increased by 6% in emerging markets in 2016. More than 2 billion people will be utilizing fintech products by 2022.
What is the current market size and how large is the fintech industry?
According to some researchers, the FinTech market will be worth $50 billion by 2022, according to Techonomy forecasts, and $310 billion by 2022, according to Accenture Global Technology. The latter appears to be significantly greater than predictions made by other sources. These figures also appear skewed because they were calculated using startups that were incorporated in the US or Canada and thus included in the industry size.
Regardless of how big you think the fintech sector is, it is obvious that it is still expanding and that things will probably change quickly in the coming years. Over the past few years, there has been a steady increase in the proportion of investments in overall startup funding. 2019 saw it reach an all-time high of 13.5%. Fintech startups had raised $32.4 billion worldwide as of Q1 2022. Additionally, they work in various markets and offer various financial products.
Types of Fintech Solutions
Software-enabled services: This class of fintech service is centered on developing cutting-edge goods and services for the consumer. Software-enabled businesses include such like Stripe, Paypal, and Amazon Web Services.
Financial services: This type of fintech solution’s key differentiator is that it completely overhauls an existing company paradigm. For instance, a retail bank may choose to use fintech products to provide financial services to its clients that are not generally offered.
Providers of platforms: These businesses serve as a layer connecting customers to other services offered in the market. They offer the tools necessary for financial institutions to create their own products. The banking platform providers Braintree, Stripe, and PayPal are all excellent examples.
What Does the Market’s Future Hold?
You are correct if you think the fintech industry will expand in the next years. We anticipate that by 2022, a remarkable growth rate in a sector that currently contributes less than 1% of the global GDP, new tech companies will have been established. As a result, fintech will keep playing a big part in international trade.
Source: FinSMEs
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