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Discovering the keys to the financial revolution: the Fintech sector leads the online money movement.
What is Fintech?👍 / What is not Fintech?👎
👍 The union of Financial + Technology = Fintech. Under this term, everything related to finance and technology is embraced: collections, payments, investment, digital banking or lending.
👍 Its objective is to combine processes, technologies and security to give rise to startups or digital companies with more efficient, accessible, fast or disruptive value propositions.
👎The Fintech sector does not refer only to neobanks, although Neobanks do fall under the Fintech Industry.
👎 Fintech is not the mobile app of a traditional bank or the website of a lending company where you leave your number so that THEY CALL YOU NOW and the microcredit is closed over the phone.
The sector in figures📈
The figures of the Fintech Industry are among the most striking of the startup scene.
Both in terms of absolute numbers and the growth rate it experiences year on year, this vertical is one of the most attractive in the digital world.
📈In Spain, Fintechs attracted a total of €542M in investment in 2021, mostly from private equity. Compared to 2020, we have an increase of +151%, according to the Startup Observatory of the Bankinter Foundation.
In Europe, McKinsey estimates the sector in terms of value creation at €430 billion. This value is greater than the capitalization of the 7 largest banks in Europe combined.
The 3 Fintech🥊 challenges
Being a service, with an intangible like money and with strict regulation, the 3 main challenges for Fintech are:
🥊 Regulation: the fuzzy boundaries of rules and laws in different countries operating globally. Protecting the user to position Fintech as a 100% reliable sector.
🥊 Communication: the fine line between communication and investment advice. The most recent example: thousands of young GenZ investing in cryptos without understanding the product at all.
🥊 Legacy structures: traditional banking has left offline structures that mark the current functioning of Fintechs. Excellent UX and technology can bridge this gap.
The 5+1 Fintechs that stole the show🎤
Not all of them are here (in Spain alone there are +490), but here are 5+1 that you can't miss.
🎤Klarna: the Swedish giant that can do anything. Its integrated deferred payment solutions in checkout, omnichannel and OpenBanking are unstoppable.
🎤 N26 vs Revolut: the two big European neobanks. The first one simplified neobanking and made it aspirational. The second included everything it could in its service offering.
🎤 Finizens: the patriotic roboadvisor with which you can open an account in minutes and start investing in automatic mode thanks to its Automated Management technology.
🎤 Fintonic: the Spanish pioneer that took its claim "Tus Finanzas en forma" to a TV spot. Its app allows you to connect all your accounts and diagnose your expenses or immediate financing.
🎤 Stripe: in its day it was the payment gateway with the best conversion rate in the market. Now they have a whole universe of services for collections, billing or fraud management.
🎤 IronIA Fintech in the age of AI, IronIA Fintech is presented as a supermarket for investors through subscriptions ranging from €9.99 to €99.99/year. If you are wondering what IronIA Fintech is, you can see it better in its 4 user profiles: I am a Saver, I like to Decide, I have Experience and Financial Guru.
Action points: opportunities you can take advantage of today ⚡
The Fintech market continues to grow every year. We leave you with some opportunities that the sector presents and you can take advantage of:
⚡Open Banking technology makes it possible to index users' banking movements. The possibilities it offers are endless and little exploited: customized products, real-time bank scoring, etc.
⚡Financial Education is still unfinished business across the continent: merging EdTech with Fintech gives the user Learning by Doing solutions with double benefits: investment and training.
⚡Everything related to financing and neobanks for SMEs is a territory to explore, but much less mature than for end users. Moving and adapting solutions from B2C to B2B is another latent opportunity.
