The CNBC and Statista partnership gathered together a list of the world's top 200 fintech companies that are creating tech-driven financial products and services across the world.The list was formed using a set of performance indicators such as user volume, revenues, etc. and was classified into nine categories: neobanking, digital payments, digital assets, digital financial planning, digital wealth management, alternate financing, alternate lending, digital banking solutions, and digital business solutions; this was to make sure that it was not difficult to compare different fintechs in different fields.Although the fintech industry is going through a tough time with many companies downsizing and fewer funds available, the markets are still producing innovative tools such as budgeting apps and tech to tackle financial services' major issues.CNBC has sorted the list by sector and you can check the methodology by clicking this link.
Digital banks, or neobanks, have been steadily gaining traction, as they strive to compete with larger, more traditional banking services. Despite the global contraction of consumer spending, a number of neobanks have managed to remain financially afloat through the increased demand for lending services. Popular neobanks include Revolut, Monzo, Starling, Kuda of Nigeria, and Niyo of India. These companies are typically licensed and specialize in providing fee-based banking services and consumer-facing products.
The digital payments industry is worth over $54 trillion according to JPMorgan, and this is only expected to increase as more of the world embraces digital transformation. This has opened the door for multiple players to innovate and offer their own services, leading Statista to identify 40 major digital payments companies. These include Alipay, Tencent's WeChat Pay, and Stripe in the US, as well as Klarna, Affirm, and Afterpay. Despite fears of a decline in consumer spending, buy now, pay later services have become a lifeline for many as inflation puts pressure on people to find flexible payment options. Other notable players included Orange (Orange Money) and Signifyd, with the former being a popular mobile money service with more than 80 million accounts across the world.
The digital assets market has been hit hard recently due to tightening regulations following collapses of big-name firms such as FTX, Terra, and Celsius. In addition, digital currency prices have plummeted since reaching their peak in November 2021, leading to a drop in trading volumes and exchange revenues. These downturns have been reflected in the private market as well, with major digital assets companies, including Binance, being heavily scrutinized by regulators. Although Binance denies the allegations put forward by the U.S. SEC, there is an effort globally to bring digital assets within the regulatory framework. The U.K. government is focusing on becoming a "crypto hub" and the European Union is making progress with pertinent regulations. This is reflected in Statista's top fintech companies operating in the digital assets sector, including Binance, Coinbase, BitMart, and OpenSea.
The digital revolution is transforming financial planning. Instead of relying on cumbersome paper-based solutions, people are turning to online tools to better manage their finances. These platforms provide users with increased transparency and allow them to make more informed decisions. Additionally, the cost of living is rising, resulting in greater financial pressure for households, spurring firms to focus more on education and awareness. Statista identified 20 of the most innovative companies in the financial planning space, such as NerdWallet and Credit Karma, which are pushing the boundaries of how individuals select and learn about financial products, as well as helping them improve their credit scores.
Over the past few years, tech startups have drastically disrupted the landscape of wealth management. They have done so by offering lower fees, easier onboarding, and simplified asset selection processes. Robinhood and eToro have made it easier for people to invest in stocks and other assets, and to acquire knowledge about financial markets that usually only the wealthy had access to.The Covid-19 pandemic has caused a surplus of savings due to economic stimulus packages, allowing fintechs in the wealth management space to take advantage of people who were more willing to risk their money. However, the high point of the 2020 and 2021 retail investing boom is behind us, and now companies are focusing more on becoming profitable and establishing a sustainable enterprise.In response, platforms are emphasizing product development and long-term investing strategies to keep customers interested. Additionally, numerous companies have started providing the option to invest in high-yield savings options, such as government bonds, as interest rates are so high.Statista has identified 20 names in the wealth management sector, including Robinhood, eToro, and Wealthfront.
Small- and medium-sized businesses, often rejected by traditional banks, have started exploring alternative financing avenues to gain the necessary funds to expand, cover costs, and repay outstanding debts. Equity crowdfunding has enabled companies to give their early customers partial ownership of the service they are using. Revenue-based financing, that involves exchanging funds for a percentage of future earnings, is another popular choice for companies who are turned down by banks and venture capitalists.But these alternatives often come with higher interest rates, making them more attractive than loans, yet it presents challenges for companies as it becomes more difficult to raise their own capital.For these new financing solutions, 2o firms have been recognized; they include Patreon that provides membership services for online content makers, and crowdfunding companies such as Kickstarter and Republic.
In recent years, the financial services industry has observed an increasing number of non-bank lenders.Tech startups have sought to offer superior services than traditional banking institutions by utilizing cloud computing and AI in order to enhance service quality and speed up loan approvals.As estimated by GlobalData,the global digital lending platforms market is projected to be valued at $11.5 billion by 2023; and this is anticipated to reach $46.5 billion by 2030.In the past year, numerous fintech companies have turned towards lending as the main component of their business, striving to take advantage of the rising interest rates, which have been imposed by the Federal Reserve and Bank of England, among other central banks, to curb inflation.Furthermore, as compared with digital payments, lending is more lucrative in the field of finance in general.Whereas payments companies usually make money from taking a small share of each transaction's value, lending can be a higher margin business.Statista recorded 25 top alternate lending companies, including American Biz2Credit, Irish Wayflyer and Latvian Mintos.
The banking-as-a-service and open banking movements have been gaining in popularity among fintech companies, allowing them to provide customers with a range of financial products such as checking accounts, cards and loans, without being the face of the services themselves. Embedded finance, or integrating third-party financial services like bank accounts, brokerage accounts and insurance policies into other businesses' platforms, has also gained traction. However, this area of fintech has not escaped the impacts of a hawkish central bank environment, with some fintech firms unable to secure the necessary funding to keep operations going. 15 companies were awarded in the digital banking solutions sector, and leaders in the field such as Airwallex, ClearBank and Solaris are taking advantage of the opportunities.
The attention of investors in the fintech sector has been primarily focused on digital business solutions as of late. These offerings encompass a range of financial products for businesses such as accounting, finance, HR, and fraud prevention. As the current economic hardship has put a strain on many enterprises, the necessity for solutions that can help alleviate their financial burdens and better adhere to regulations has increased. According to Statista, there are 25 companies that fall into this group, amongst them Intuit, Deel, and Seon.
Comments