Global Fintech Market: Recent Performance and the Effect of COVID-19 – Investigating the Impact of the Pandemic in the Financial Technology Sector

Global Fintech Market: Recent Performance and the Effect of COVID-19 – Investigating the Impact of the Pandemic in the Financial Technology Sector

Konstantinos Tsanis, Vasilios Stouraitis
Copyright: © 2022 |Pages: 23
DOI: 10.4018/978-1-7998-8346-3.ch001
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Abstract

The FinTech industry has been growing rapidly and significantly, becoming the go-to service provider for some of the most important financial services, such as lending and payments. Since 2020, the onset of COVID-19 has substantially impacted the industry, both positively and negatively. This chapter discusses the recent performance of the FinTech industry based on a large-scale survey across the globe. The chapter then focuses on analysing the ‘new normal' in banking, after the pandemic era, based on the findings of the global survey, with explicit focus on the FinTech sector, followed by further implications on the impact that the pandemic had in the traditional banking sector. The chapter concludes by providing an overview of the emerging opportunities that appear in the FinTech sector.
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2. Survey Data: The Global Covid-19 Fintech Market Rapid Assessment Report

In order to better understand and assess the impact that Covid had in the global FinTech markets, the World Bank Group, along with the World Economic Forum and Cambridge Center for Alternative Finance conducted a large scale survey5. The findings of the survey are presented in the following section.

2.1 Distribution of Survey Respondents67

In this research project, titled ‘’Global Covid 19 FinTech market rapid assessment study’’ we had the participation of 1035 FinTechs. Graph 1 represents the distribution among primary FinTech verticals. As expected, Digital Lending is a primary activity, with 21% of surveyed FinTechs focusing on it. Digital Payments is the second most popular vertical with 18% of FinTechs involved. Capital management was another field with large representation, with 14% and 8% of FinTechs engaged in a Digital Capital Raising and Wealthtech verticals, respectively.

Surprisingly, only 1% of surveyed FinTechs work on Digital Savings, a percentage which is much lower than that of areas, such as ETP (9%), Insurtech (7%), RegTech (6%), Digital Banking (6%), Alternative Credit & Data Analytics (3%), Digital Identity (3%), and Digital Asset Exchange (3%).

Figure 1.

Survey Sample Distribution Among Primary FinTech Verticals

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Figure 2.

Geographical Distribution of Survey Respondents

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Figure 2 displays the geographical distribution of survey respondents. Most surveyed FinTechs are based in the US followed by India. Representation is high across western Europe, LATAM, Asia, Canada, and Australia as well. Fewer FinTechs are based in Eastern Europe, CIS, and Africa.

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