cloud-fin-tech

Is The Fintech Industry The Next Tech Bubble?

The Fintech Industry

Banks offered a wide variety of services such as payments, money transfers, wealth management, selling insurance, etc. over the years. While banks have expanded the number of services they offer, their core still remains credit and interest.

Many experts believe that since banks offered such a wide multitude of services, they have lost their focus and have over extended themselves. This is why many Fintech startups started in the last decade are starting to give banks a run for their money. Most of these fintech startups specialize in one particular field and focus on customer experience and convenience.

For instance, PayPal started offering online payments as a service for merchants when checks were becoming irrelevant for e-commerce transactions. This immediately made PayPal a household name and the company was able to gain significant market shares in a sector that was gravely neglected by banks.

DealSunny, a company that specializes in special offers and coupons, devised a neat infographic exposing some of the facts about the amazingly fast growing Fintech industry. This infographic should help you make sense of the current climate in the Fintech sector. Here are a few points we got from the infographic (see the full infographic below):

Fin tech

1. As of the end of 2015, there were 1362 fintech companies spread across 54 countries in the world. While most of them are startups, the industry as a whole has received a staggering $25.8 billion in funding from investors. That is an average of $44 million per company.

2. Fintech experts say that Israel, United States and the United Kingdom offer the best ecosystems for fintech startups with knowledgeable and willing investors, friendly government regulations and government incentives for the industry. Specifically, most fintech startups are clustered around Tel Aviv in Israel, London in the United Kingdom and Silicon Valley, Los Angeles & Boston in the United States.

3. While many countries provide a good ecosystem for fintech startups, no country can match the United Kingdom, Singapore and Luxembourg. These countries invite the fintech startups with a red carpet giving them many incentives to launch and operate their business in their country. The United Kingdom offers many perks such as tax holidays and a £860 million fund from the National Cyber Security Programme for deserving cyber security companies. Singapore and Luxembourg have launched many initiatives for financing and incentivizing fintech startups in their country.

4. The initiatives undertaken by the governments have paid off and London in the UK, Singapore and Tel Aviv are among the frontrunners in the fintech industry. The Nordic countries are expected to lead a lot of development in this field in the future. The most famous cities for fintech companies in these countries are Oslo, Amsterdam, Copenhagen, Stockholm and Helsinki.

5. While the success of Fintech in our increasingly interconnected world is a no-brainer, there are some other important reasons for the exponential growth of the industry. Many people are switching from banks to Fintech companies because these services are said to be easier to setup, offer attractive pricing options and provide a better online experience compared to conventional companies. Also, many people claim to have switched because of the better quality of service offered by Fintech alternatives along with their more innovative solutions.

6. While fintech companies are located in over 50 countries around the world, a large chunk of the $49.7 billion that was invested internationally has been grabbed by companies in the United States and the United Kingdom. $31.6 billion out of all the investments in the industry has gone to the fintech companies in the US alone, while UK received a mere $5.4 billion. Other countries that have received more than a billion in funding are China and India. All the fintech companies in the European Union combined have received $4.4 billion in funding.

While it is true that many of the popular financial technology companies have stolen market shares from traditional banks, many experts are of the opinion that these companies are a necessary evil for banks. Banks are usually huge and have a monopolistic position in the markets that they operate in. This gives them few incentives and a lot of difficulties when it comes to implementing new technologies for their operations. Fintech firms have now forced banks into offering better services to their customers by way of new technologies, making the world better for all of us.

By Robert Hendriks

CloudTweaks

Established in 2009, CloudTweaks is recognized as one of the leading authorities in cloud connected technology information and services.

We embrace and instill thought leadership insights, relevant and timely news related stories, unbiased benchmark reporting as well as technology related infographics and comics.

Contact us for more information on how to get involved in our content related services and placement programs.

CONTRIBUTORS

2017 Expected To Bring Cloud Service Price Hikes

2017 Expected To Bring Cloud Service Price Hikes

Cloud Service Price Hikes As the year comes to a close and there’s a new one on the way, people ...
The Evolution of the IoT Broker

The Evolution of the IoT Broker

The IoT Broker The concept of a cloud broker has changed and we now instead call it the Hybrid Cloud ...
Cloud Native Trends Picking Up – Legacy Security Losing Ground

Cloud Native Trends Picking Up – Legacy Security Losing Ground

Cloud Native Trends Once upon a time, only a select few companies like Google and Salesforce possessed the knowledge and ...
Cloud Computing, AI and The Future of Language Translation

Cloud Computing, AI and The Future of Language Translation

The Tower of Babel Is Over Imagine: you are in a conference room with colleagues from China, Japan, Germany and ...
IoT Trends

The Internet of Attacks: Disturbing Online IoT Trends

Disturbing Online IoT Trends If you thought the worst thing to come out of the Internet of Things (IoT) trend ...
Why ‘Data Hoarding’ Increases Cybersecurity Risk

Why ‘Data Hoarding’ Increases Cybersecurity Risk

Data Hoarding The proliferation of data and constant growth of content saved on premise, in cloud storage, or a non-integrated ...
Design + Cloud + 3D Printing = Real Objects Anywhere

Design + Cloud + 3D Printing = Real Objects Anywhere

Design + Cloud + 3D Printing Got an idea for a new gadget or do you need a unique part? ...
Sports Data Analytics

Sports Data Analytics and the National Hockey League (NHL)

Sport Data Analytics Sports teams are always looking to get ahead of the competition. Winning doesn’t come easy and many ...

NEWS

HPE CEO Whitman's surprise exit stumps Wall Street

HPE CEO Whitman’s surprise exit stumps Wall Street

(Reuters) - Shares of Hewlett Packard Enterprise Co (HPE.N) fell 6 percent on Wednesday after Chief Executive Officer Meg Whitman’s ...
OVH Announces New Hosted Private Cloud Offerings for US Market

OVH Announces New Hosted Private Cloud Offerings for US Market

OVH delivers next-generation services for hosted private cloud, disaster recovery, and hybridity leveraging industry-leading solutions RESTON, VA--(Marketwired - Nov 20, ...
Cloud Security Alliance Issues New Code of Conduct for GDPR Compliance

Cloud Security Alliance Issues New Code of Conduct for GDPR Compliance

EDINBURGH, Scotland, Nov. 21, 2017 /PRNewswire-USNewswire/ -- The Cloud Security Alliance (CSA), the world's leading organization dedicated to defining and raising awareness of best practices ...

SPONSORS

What Is Really Driving Cloud Adoption?

What Is Really Driving Cloud Adoption?

Driving Cloud Adoption Cloud adoption is growing at an astounding rate, with companies big and small undergoing digital transformation towards ...
Visual Data Analytics Helps To Illustrate The Big Picture

Visual Data Analytics Helps To Illustrate The Big Picture

Visual Data Analytics We’re consistently hearing how valuable data is today, how important it is to the success of every ...
AT&T Pinpoints 4 Key Elements To Achieving Security With The Internet of Things

AT&T Pinpoints 4 Key Elements To Achieving Security With The Internet of Things

Internet of Things Security The Internet of Things (IoT) is rapidly becoming a part of many of our business processes, ...