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The fintech market size is estimated to increase by USD 536.6 billion, at a CAGR of 28.34% between 2023 and 2028. Market growth hinges on several pivotal factors such as the impact of digitalization, the incorporation of big data and artificial intelligence within Fintech, and ongoing innovation and development efforts. Digitalization is reshaping financial services, driving efficiency and expanding access to a broader consumer base. The integration of big data and AI enhances decision-making processes, improves risk management, and personalizes customer experiences in Fintech solutions. Moreover, continuous innovation and development foster new products and services, addressing evolving market demands and enhancing competitive edge. These interconnected trends underscore a dynamic market environment where technological advancements and strategic initiatives propel growth, transforming the landscape of financial technology and shaping its future trajectory globally.
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The market is revolutionizing financial products and services through innovative approaches that challenge traditional financial methods. Leveraging application programming interfaces (APIs) and artificial intelligence (AI), Fintech firms excel in data analytics to provide convenient services with enhanced transparency. This sector's growth is driven by collaborations between financial bodies and national regulators, ensuring compliance while fostering value-added services. However, concerns over data privacy and security breaches persist, as Fintech handles sensitive information including personal information, financial records, and insights from online buying habits and social media habits. Safeguarding against malware injection and data loss, Fintech firms prioritize security to protect personal and sensitive data from unscrupulous actors. With capabilities to influence financial decision-making and credit scores, Fintech continues to reshape the financial sector, offering tailored solutions that cater to evolving consumer demands while mitigating risks associated with digital formats.
The influence of digitalization is notably driving market growth. The demand for smart connected devices is growing rapidly worldwide owing to the internet revolution. Managing, monitoring, and maintaining information security in the organization has also become both essential and complicated. Thus, the demand for M2M communication will increase during the forecast period as it helps financial service providers significantly improve their business processes and make effective decisions in real time. The increase in the number of connected devices around the world is a major factor driving the demand for the software.
Due to the digitization of companies and processes, there is a large number of complex and diverse data sets in the world. In addition, due to the use of advanced and versatile machines and equipment, the data and contents produced by organizations are diverse, versatile, and complex. With embedded analytics technology, organizations can transform unstructured and semi-structured information into structured information. FinTech software helps in the business processes of the organization, which is expected to further boost the growth of the global market during the forecast period.
The growing popularity of blockchain is an emerging trend in the market. Blockchain is considered the most popular Bitcoin wallet in the world. Many banks choose this technology to perform various tasks such as authentication processes or to verify documents in the banking system.
Further, blockchain technology helps the banking system process various financial transactions, helping financial institutions save billions. This is done through internal financial transactions and also by clarifying the cost structure. Banks are expected to rely on blockchain technology during the forecast period, as the countless potential benefits of blockchain technology help facilitate business transfers at significantly lower costs and minimal decentralization. This, in turn, boosts the potential growth of the market during the forecast period.
Privacy and security concerns are major challenges impeding the market. In many developing countries the concept of online payments is emerging. Mass market customers are not aware of the benefits of using such technologies. The adoption of the business models and platforms is low despite the high penetration of the internet.
Payment service providers collect personal data about customers so that they can tailor advertising messages and target their advertising to key target groups. Such practices help providers gather information about customer profiling, behavior, and data mining. However, arbitrary use of this information may violate the privacy of the customer. Location-based services also have data protection issues, as such offers and services operate on the basis of real-time geographic data. Since smartphones are used for financial transactions in real time, data theft can lead to financial losses for consumers and reputational losses for service providers. Such risks make consumers hostile to online shopping and pose a potential threat to the global market during the forecast period.
The report includes the adoption lifecycle of the market, covering from the innovatorâs stage to the laggardâs stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Market Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
The report also includes detailed analyses of the competitive landscape of the market and information about 15 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The market share growth by the on-premise segment will be significant during the forecast period. In 2023, the on-premise segment holds the largest share of the global market, as on-premise deployments enable the real-time monitoring of the software, ensuring the complete security of transactional data.
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The on-premise segment was valued at USD 49 billion in 2018. In the cloud-based deployment model, data are stored on multiple servers, whereas in the on-premise deployment model, data are stored on dedicated servers. This offers good control and security over information. Large financial institutions that deal with multiple transactional information daily prefer on-premise software solutions, as they provide an optimum level of data security with physical access controls and security protocols. Furthermore, on-premise deployments provide a secure environment during regular software updates. Therefore, this segment is estimated to expand during the forecast period.
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North America is estimated to contribute 38% to the growth of the global market during the forecast period. Technavioâs analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. Another region offering significant growth opportunities to vendors is APAC. APAC is the fastest market owing to its high growth potential, coupled with faster adoption of technologies such as blockchain across industries and an influx of SMEs. In addition, growing economies are the largest adopters of distributed ledger technologies, thus creating multiple opportunities for startups in the financial market to fundamentally redefine their business and operational models. Therefore, the higher adoptions of distributed ledger technologies aided by the growing penetration of the internet and smartphones helped companies of the BFSI industry to launch distributed ledger technology (DLT) platforms, fostering further the growth of the fintech market in APAC during the forecast period.
The market research report provides comprehensive data (region wise segment analysis), with forecasts and estimates in "USD billion" for the period 2024-2028, as well as historical data from 2018 - 2022 for the following segments.
The Fintech (financial technology) sector is experiencing rapid growth, driven by the market's key driving drivers, such as technological innovation and increasing consumer demand for convenient payment services and fund transfer solutions. Fintech encompasses diverse segments including loans, insurance, wealth management, and personal finance, leveraging Application Programming Interfaces (APIs) and blockchain technology to streamline operations and enhance security. Regulatory frameworks like the Dodd-Frank Act and MiFID II regulations shape the industry landscape, ensuring compliance and fostering trust among insurance companies and financial institutions. Investments in Insurtech and Regtech highlight advancements in fraud detection and compliance & regulatory support, while technologies like AI-powered chatbots and virtual assistants improve KYC verification and customer service. With a focus on GDPR compliance and robust fraud monitoring, Fintech firms such as Mastercard and Fiserv, Inc are pioneering mobile wallets and enhancing cloud service abuse mitigation, safeguarding against account hacking and bolstering financial security.
Market Scope |
|
Report Coverage |
Details |
Page number |
160 |
Base year |
2023 |
Historic period |
2018 - 2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 28.34% |
Market growth 2024-2028 |
USD 536.6 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
22.16 |
Regional analysis |
APAC, North America, Europe, South America, and Middle East and Africa |
Performing market contribution |
North America at 38% |
Key countries |
US, India, China, UK, and Germany |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Acorns Advisers LLC, Adyen NV, Affirm Holdings Inc., Alphabet Inc., AlphaSense Inc, Avant LLC, Barker Brooks Communications Ltd., Camden Town Technologies Pvt Ltd., CLYDE TECHNOLOGIES, INC, Earnest Fintech, FinTech Sandbox Inc., Fundrise LLC, International Business Machines Corp., Microsoft Corp., PayPal Holdings Inc., SIGMOIDAL LLC., SoFi Technologies Inc., Stripe Inc., and Upstart Network Inc. |
Market dynamics |
Parent market analysis, Market forecasting growth inducers and obstacles, Fast-growing and slow-growing segment analysis, Market growth and Forecasting, COVID 19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period |
Customization purview |
If our market report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Application
7 Market Segmentation by End-user
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Opportunity/Restraints
11 Competitive Landscape
12 Competitive Analysis
13 Appendix
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