What is Fintech?

Fintech, which combines the words “financial” and “technology,” is a relatively new and somewhat ambiguous phrase that refers to any developing technology that enables consumers or financial institutions to supply financial services in a newer and faster way than previously possible. Consider the difference between walking into a bank to inquire about your balance and being able to access that information in real-time on your phone.

The evolution of financial services includes anything from a consumer’s capacity to viewing their financial activities online and allowing contactless payments to tools that help financial institutions to make quick lending decisions.

Type of Fintech services

Fintech in action also includes the capacity for investors to conduct their own research, select companies, and track the success of their portfolios in real-time. FinTech is empowering consumers to take control of their financial lives, resulting in far greater financial literacy than previously possible. By employing new technology, it is tearing down traditional silos and assisting people in improving their financial status and outcomes. Here’s a quick look at how the fintech service business is both disrupting and boosting some areas of the finance industry.

1. Credit and Digital Lending

Lending Club uses peer-to-peer lending to allow users to lend money to each other for business projects without the involvement of a traditional financial institution. The utilization of Big Data and advanced analytics across digital platforms has enabled each of these developments.

Examples of Key Fintechs in Credit and Digital Lending:

Credit Karma 

Credit Karma based in San Francisco from 2007 provides a service (free credit reports) in exchange for the opportunity to market loans and credit cards suited to the unique needs of its consumers in the burgeoning sector of credit reporting.

Kabbage

Kabbage, founded in 2008 based in Atlanta, provides loans and fundings directly to small businesses and consumers through an automated lending platform and uses transactional data to make lightning-fast lending choices.

Tala

Tala, based in Santa Monica offers digital financial services to help the traditionally underbanked borrow, save and grow their money. Their consumer credit app is the world’s most accessible, instantly underwriting and disbursing loans to people who have never had a formal credit history.

Petal

Petal, based in New York from 2016, analyses consumers’ banking history and transforms it into a Cash Score (an alternative measure of your creditworthiness based on income, savings, and spending history). To allow more people to be approved with better rates, even if they’ve never had credit before.

Earnest 

Earnest, based in San Francisco from 2013 uses its Precision Pricing tool to determine individualized customer loans by using personal data to formulate student, home, car, and medical loans that are based on an individual’s unique situation to match the user with a rate and term that works for them instead of a standard rate and term.

2. Mobile Banking

With the increased demand for digital banking among consumers, several financial institutions are adopting or expanding their mobile banking capabilities. On their platforms, most banks today have some form of mobile banking functionality such as e-banking.

Examples of Key Fintechs in Mobile Banking:

Chime

Chime, based in San Francisco founded in 2013, is a new one-of-a-kind mobile bank that offers no-fee and automatic savings accounts as well as early payday via direct deposit. With over one million opened accounts, Chime is reportedly one of the fastest-growing banks in the United States.

N26

N26, founded in 2013 from Berlin based in the US, is an online bank account that allows users to manage their entire financial life from their phone. With a full European banking license, state-of-the-art technology and no branch network, N26 has redesigned banking for the 21st century.

MX

Mx, founded in 2010 from Utah, is one of the fastest growing leading data platforms for banks, credit unions and fintechs. It enables its clients and partners to easily collect, enhance, analyze, present and act on financial data. Using MX platform and products, MX clients are able to understand their customers in real-time like never before, allowing them to be truly customer-centric, empowering them to grow faster and deliver an exceptional customer experience all while reducing costs.

Cash App

Cash App, founded in 2013 based in New York, is a mobile payment service developed by Block, Inc. that allows users to transfer money to one another using a mobile phone app. It is a simple product with a single purpose to bring a better way to send, spend, invest, and save to our millions of monthly active users. The service is only available in the US and the UK.

Starling Bank

Starling Bank, founded in 2014 is a digital challenger bank based in the United Kingdom, which focuses on current and business account products. Through the app and online banking platform, they are helping nearly 1 million customers for quicker, easier and better control of their money like never before. 

3. Mobile Payments

If you ask someone under the age of 30 how they prefer to pay, they’ll almost certainly tell you that smartphone apps are the way to go. Peer-to-peer services like Venmo have emerged to replace traditional payment methods as we’ve evolved from a cash-based society to one that is increasingly digital. In reality, mobile point-of-sale transactions are expected to reach $43 trillion globally in 2021.

Examples of Key Fintechs in Mobile Payments:

Veem

Veem was founded in 2014 based in San Francisco is a smart online and fee-free option to send, receive, and reconcile business payments within the United States and Canada.

PayPal

PayPal was founded in 1998 in California based on a convenient, easy to use, and ubiquitous payment platform, both for shopping online and paying friends too. It operates as an online payments system in the majority of countries that support online money transfers, and serves as an electronic alternative to traditional paper methods such as checks and money orders.

Zelle

Zelle was founded in 2016, an Arizona based digital payment that  may be the simplest way to send money to a person in the US. It works inside your bank app or website, so the money goes straight into the receiver’s account.

Ayden

Adyen is a Dutch payment company that allows businesses to accept e-commerce, mobile, and point-of-sale payments founded in 2006. Their unique data ecosystem reveals opportunities where businesses can grow. With their machine learning technology, they also protect their customer’s identity. It is listed on the stock exchange Euronext.

Circle Pay

Circle Pay was launched in 2013 based in Boston to help internet businesses accept payments and send payouts globally in one unified platform. Move digital money leveraging traditional payment rails or do business in a more global, scalable, and efficient way through blockchain infrastructure.

4. Blockchain & Cryptocurrency

Users buying or selling cryptocurrencies such as bitcoin have been able to connect through cryptocurrency exchanges. By storing provenance data on the blockchain, blockchain solutions have tried to prevent fraud.

Examples of Key Fintechs in Blockchain and CryptoCurrency:

eToro

eToro, founded in 2007, is an Israeli social trading and multi-asset brokerage company that focuses on providing financial and copy trading services such as forex and crypto. It has registered offices in Cyprus, the United Kingdom, the United States, and Australia. The app is fully compatible with both iOS and Android devices to have access to a huge number of markets.

Webull

Webull is one of the best apps to buy cryptocurrency with small stakes. Webull Financial LLC founded in 2017 based in New York offers an electronic trading platform, accessible via mobile app and desktop computer, for the commission-free trading of stocks, exchange-traded funds, options, margins, and cryptocurrencies.

Coinbase

Coinbase is one of the best apps to invest in cryptocurrency for beginners digital currency wallet and platform where merchants and consumers can transact with new digital currencies. Founded in 2012 remotely, it is a secure online platform for buying, selling, transferring, and storing cryptocurrency such as Bitcoin, Bitcoin Cash, Ethereum, Ethereum Classic and Litecoin.

Binance

Binance is one of the world’s leading blockchain and cryptocurrency infrastructure providers with a financial product suite that includes the largest digital asset exchange by volume. It is dedicated to increasing the freedom of money for users, and features various crypto products and offerings such as trading and finance, education, data and research, social good, investment and incubation.

Gemini

Gemini has been based in New York since 2014 and is the best Cryptocurrency exchange and custodian app that allows customers to buy, sell, and store large digital assets. It regulates cryptocurrency exchange, wallet, and custodian that makes it simple and secure to buy bitcoin and other cryptocurrencies.

Want to learn more and get insights about Fintech?

CFTE is the number #1 UK’s Fintech E-learning course got you covered. That is why, we want to offer you a free Fintech Masterclass to get a 360 degree overview of how finance is digitally transforming directly from industry experts. You can also, go check the CFTE page to find the most suited Fintech course for you. You can chat with our customer support team or email us at learning@cfte.education to find out more!

Conclusion

FinTech’s success is owed in large part to the chance it provides small businesses to compete on an equal footing with traditional banks and financial institutions. It’s no longer about who’s the biggest, but who’s the fastest and most responsive at effectively meeting ever-changing consumer needs, thanks to FinTech. Furthermore, FinTech organizations’ solutions are no longer “one size fits all.” Instead, they provide tailored services that satisfy a specific financial need at far lower costs than traditional financial providers. The FinTech companies that flourish will be those that continue to innovate in delivering new answers to old problems as customers become more savvy and connected.

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We interviewed 8 amazing fintech founders building the next unicorns and here’s their advice on how to be an successful entrepreneur:

1. Embrace Failure

If you’re building a startup, you must accept that failure is inevitable. That’s exactly what Sahil Kini, the Co-Founder of Setu, would say to aspiring entrepreneurs. It’s favorable to fail early and have the ability to iterate until you get it right rather than fearing failure.

The untold story of Setu’s Co-Founder, Sahil Kini– Episode 5 ( Watch it on YouTube, listen on Apple Podcasts and Spotify Podcasts)

2. Know That There Is Always A Problem To Solve

If your veins flow with entrepreneurial blood, then you’ll absolutely agree with Odunayo Eweniyi, Co-Founder of Piggyvest, when she says that there is no scarcity of problems and gaps that need to be filled in the market. So if you want to build a company, keep your eyes wide open because there’s always an untapped opportunity waiting to be discovered.

The Untold Story of Odunayo Eweniyi, Co-Founder of Piggyvest– Episode 2 ( Watch it on YouTube, listen on Apple Podcasts and Spotify Podcasts)

3. Do Your Research

Building a company is no easy feat. Though you may conjure up an idea that works really well in your head you need to esure that the product or service actually works. Perseus Mlambo, the CEO of Union54 said that every entrepreneur must do their research and ground work to figure out what really works.

The untold story of Union54’s CEO, Perseus Mlambo – Episode 6 ( Watch it on YouTube, listen on Apple Podcasts and Spotify Podcasts)

4. Be Resilient

You’ve Gotta Have Nerves Of Steel! – Frans Van Eersel, Dopay’s Co-Founder, often had to encounter a number of hurdles as an entrepreneur. Being a fintech founder, the regulatory pushback was strong, but having resilience and patience is what differentiates an entrepreneur from anyone else.

The untold story of Dopay’s Co-Founder, Frans Van Eersel – Episode 3 ( Watch it on YouTube, listen on Apple Podcasts and Spotify Podcasts)

5. If You’re Going To Do Something, Grasp It By The Horns

If you have decided to tread down the path of an entrepreneur it’s going to most definitely involve a lot of sweat and tears. Keeping that in mind, Omair Ansari, the CEO of Abhi (YCS21) says, when you jump in, make sure that you work with an ethos of complete thoroughness in everything you do.

The untold story of Abhi (YC S21)’s CEO, Omair Ansari – Episode 7 ( Watch it on YouTube, listen on Apple Podcasts and Spotify Podcasts)

6. Be Comfortable With Ambiguity

Cluelessness lies at the heart of entrepreneurship and Nitya Sharma, the Founder of Simpl, says that we need to learn to be comfortable with it. Being unsure about things can be looked down upon, but in reality it’s an invitation to learn. In some cases even some of the best entrepreneurs never would have launched if they had known better.

The untold story of Simpl’s Founder, Nitya Sharma – Episode 4 ( Watch it on YouTube, listen on Apple Podcasts and Spotify Podcasts)

7. Learn From Your Customer

Sometimes the way we envision a product may not be the full picture, at the end of the day the way your customer decides to use the product really shows you the potential and possibilities of its use case. Ray Youssef, the the CEO of Paxful, said when he went to create a crypto startup centered on Crypto, he learned from users that it was more than just a speculative investment. Crypto was evolving into a medium of exchange.

The Untold Story of Ray Youssef, CEO of Paxful – Episode 1 (Watch it on YouTube, listen on Apple Podcasts and Spotify Podcasts)

8. Know your market, and talents

Monis Rahman’s diverse entrepreneurial journey sharpen his understanding of his own country, Pakistan, where he operates 3 different businesses. He emphasised the importance of finding the right talents when building a business, and how it can be one of the most important driver for growth.

The untold story of Dukan.pk’s CEO, Monis Rahman – Episode 8 (Watch it on YouTube, listen on Apple Podcasts and Spotify Podcasts)

The post 8 Tips On What It Takes To Be An Exceptional Entrepreneur appeared first on CFTE.

Singapore Fintech Report 2021: Blockchain takes center stage

One of the fintech verticals that has become well-known in Singapore is blockchain and cryptocurrencies, which now dominate the local fintech scene. Of the 430 fintech startups identified in Singapore, 19% operate in the blockchain and cryptocurrency vertical, making them the largest segment, on the payments front (16%), investment and wealthtech (14%), and regtech (11%).

The Singapore Blockchain Innovation Program aims to accelerate technology development and adoption, and will involve nearly 75 companies to conceptualize 17 blockchain-related projects over the next three years in sectors starting with trade and logistics, and supply chain. This year also saw the Payment Services Act (PSA) come into effect, which requires cryptocurrency businesses to obtain a license from the MAS to comply with anti-money laundering/combating terrorism financing (AML/CFT) regulations. Singapore’s new law has been lauded for providing regulatory clarity on emerging asset classes and industries, and potentially luring companies in the space to set up shop in the city-state. That is why, it is great to catch up with the latest fintech news and updates to support Singapore’s fintech society. Below are the Top 4 rising payment startup ventures that are making noise in early 2022:

Top 4 rising payment startup ventures in Singapore

1. AirWallex

Origin: Melbourne

Year: 2015

Company Value: $5.5B (source)

Airwallex Pte Ltd is a payments platform transforming the way businesses move and manage money globally. It is one of the fastest growing financial technology companies, operating across Asia-Pacific, Europe and North America today with over 1,000 employees in 19 locations globally. On 13th January, the fintech platform announced its official launch in Singapore, following its grant of a Major Payment Institution (MPI) license by the Monetary Authority of Singapore (MAS). The Singapore team is expected to quadruple by the end of 2022 and you can be one of them! Click the link here to apply to their opening job vacancy

2. Xfers

Origin: Singapore

Year: 2015

Company Value: $600M (source)

Founded by a group of friends in Silicon Valley, Xfers aims to accelerate financial access within Southeast Asia by enabling businesses to accept payments and send money through bank transfers, e-wallets and offline channels. The company is a Major Payment Institution licensed by the Monetary Authority of Singapore for e-money issuance. Xfers boasts a range of last-mile financial rails including the Xfers Send, Xfers Accept, Xfers Wallet, and StraitsX. 

PayFazz Financial, a Jakarta Fintech Startup invested $30M to join partnership for Xfers’ enterprise solutions, regulatory compliance, and infrastructure in exchange for expansion and sizable agent network in Indonesia. With this strategic investment, the two companies will form a new entity called Fazz Financial Group (FFG).

“The COVID-19 pandemic lockdown has also driven a big surge in online sales and transactions across Southeast Asia, so there is a huge need for online payments by businesses and merchants across the region” – Tianwei Liu (Xfers co-founder)

3. PineLabs

Origin: Singapore

Year: 2015

Company Value: $3B (source)

PineLabs Pte Ltd,  Singapore’s Unicorn Fintech startup is a payments platform for merchants in India and South-east Asia that offers solutions for in-store and online payments as well as prepaid, loyalty and “pay later” programmes. It closed a US$600 million (S$807 million) fund-raising round with some of the world’s largest investors, including Fidelity Management & Research and BlackRock, as it targets an initial public offering (IPO) within 18. The digital payments provider backed by Sequoia India and Mastercard, is moving ahead with preparations for a US listing and seeks to raise about US$500 million (S$678 million), according to people familiar with the matter. If you are interested in joining, you can check here for their job openings. 

4. Brankas

Origin: Indonesia

Year: 2016

Company Value: $64M (source)

Brankas, specialises in enabling access to financial and identity data, payments initiation and other developer tools. It provides financial institutions, fintechs and online businesses with API-based solutions, and has raised US$20 million in Series B funding led by early-stage investor Insignia Ventures Partners. It also operates in Indonesia, the Philippines and Vietnam. Following the fund-raising, it is looking to deepen its payments, data and API product menu in Indonesia, the Philippines and Thailand. (API stands for Application Programming Interface, a software intermediary that enables two applications to talk to each other.) The round was joined by Brankas’ existing backers Beenext and Integra Partners. Other investors are payments giant Visa, AFG Partners and Treasury International, which is backed by fintech entrepreneurs Jeff Cruttenden of Acorns and Eli Broverman of Betterment.

Conclusion

While funding raised by fintechs globally almost doubled from 2020 to S$137 billion in 2021, funding for Singapore fintechs has grown by 2.5 times between 2020 and 2021. The most recent quarter, Q3 2021, has been the strongest yet, with about S$1.9 billion raised by local fintechs. It is all the hype right now and if you want to know more about E-payments, you can always learn more about with CFTE’s Payments in Finance (offering 80-90% subsidy for Singaporean Residents & PR’s). If you are interested in managing Fintech ventures, CFTE’s Intrapreneurship Course is right for you! Or you want to find out about the global fintech startup, check out our Ranking of Largest Fintech Companies in 2022.

The post Top 4 Rising Singapore Payment Startup of January 2022 appeared first on CFTE.

The Hottest IPOs of 2023

#1 Affirm

The first VC-backed IPO of the year was seen when Affirm, the BNPL upstart, went public on January 13th, 2021, at an $11.9 billion valuation. The company’s stock price jumped 100% on its first day of trading. The stock price has moved up and down since, and as of December 23rd, it closed at $101.16.,106% above its share price when it IPO’ed ($49). It seems that investors are rewarding Affirm for its strong momentum and potential to become a new payments player.

#2 Coinbase

The crypto trading platform, IPO’ed on April 14th, 2021, at a valuation of $86 billion. By early 2021, Coinbase had managed to become the largest cryptocurrency exchange in the United States by trading volume. Following its listing, Coinbase faced increased regulatory scrutiny and the high-volatile crypto markets definitely weighed down on it. But as of December 23rd, the Coinbase stock price was 7.26% higher than its initial IPO price ($250).

3# Marqueta

Marqeta, a popular payment processing company, made an appearance on the public stage with over 45 million shares at $27 apiece on June 8th, 2021, above its targeted $20-$24. Marqueta currently trades at $17.44 (as of 23rd Dec), 35% lower than its debut price. Early indications from the performance of Marqeta show that investors are valuing the company relatively in line with traditional high-growth software companies.

Who will IPO in 2022?

We saw some legendary startups on the main stage this year, and we’re sure 2022 will bring some exciting debuts as well. From whispers on street and investor speculations, here are the Fintech companies anticipated to go public in 2022:

Klarna: Sweden-based buy now, pay later (BNPL) startup
Revolut: London-based digital bank Revolut, is highly likely to go public in 2022—probably in a London listing
Plaid: San Francisco-based Plaid, a service that connects your bank account to online services
Chime: San Francisco-based digital bank has all eyes on it as a likely 2022 IPO candidate

The post The Hottest IPOs of 2021 🔥 appeared first on CFTE.

In 2021 there were nearly 89+ fintech unicorns born. Fintech adoption skyrocketed. VC investments climbed to the highest its ever been in the last 10 years, reaching $94.7 Bn by Oct ‘21.

With the industry experiencing stratospheric growth in 2021 as a whole, it was definitely a challenge to single out the winners. But here’s our take on who deserves to make it to the Fintech winners list for 2021.

The top 3 Fintechs of 2021

1# Square a.k.a Block

Square (Block) had a great run in 2021, and some of the notable achievements and strategic moves include:

• Partnering with TikTok to capture the creator economy
• It also partnered with Google to allow merchants to add their products to Google’s surfaces
• The company made a big swing by aquiring AfterPay, the BNPL champion to bring AfterPay’s merchant relationships into Square’s seller ecosystem and boost Square’s Cash App users

2# Opensea

Opeansea, a company that launched its NFT platform in 2018, made some big ripples in the industry as the NFT market roused from hibernation—and went crazy.

• In July, the company processed $350 million in NFT trades and raised $100 million at a $1.5 billion valuation
• The platform currently has 1.8 million active users and a large share of the NFT market
• It tackled the need for cheaper and faster transactions with its integration with layer-two Ethereum side chain Polygon

3# Stripe

The upstart on a mission to ‘increase the GDP of the internet’ has made some big moves this year as well.

• The company is currently valued at $95 billion (that’s nearly 3x higher than its valuation in April 2020) – and that’s more than Uber’s IPO
• It has managed to amass a userbase of 3.1 million active websites
• Known to have closed the door to Bitcoin 3 years ago, Stripe has recently begun moving into the crypto space again – it even established a team dedicated to crypto and “Web3”

Our take – What does this mean for 2021 as a year?

The winners of 2021 point out some important trends. Payments and Defi were definitely a winner. Investor appetite for payments was strong with funding already up by 80% by Q3 of 2021 compared to 2020. The Defi world also saw a turning point, where digital assets broke into the mainstream – with the crypto market cap topping $3 trillion for a time and global NFT sales reaching $11Bn in Q3 2021, a 200x increase from Q3 2020.

While these were not the only sectors on fire, they were definitely notable enough to leave their mark in 2021. As we head into the new year, we can’t wait to see which fintech makes a splash!

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What is a Challenger Bank?

• A challenger bank is a new digital bank that has a bank license.
• The most important word is “banking license”: a challenger bank is regulated as a bank
• It is new, so not an existing bank digitalizing its business
• And digital as we mentioned before

Challenger banks, as a result of the advent of Fintech, have been increasing in numbers in recent years. In fact, currently, there are about 100 challenger banks worldwide, offering different types of financial services to a poll of consumers whose banking preferences have shifted towards simpler, more transparent, and digital ways of managing money.

Here’s the list of the top 10 Challenger Banks in 2022 by Market Capitalisation:

1. Nubank

Supported by Tencent and Warren Buffett, NuBank has occupied a substantial position in Latin America, progressing actively from interest-free credit cards to a comprehensive set of financial services.

2. Revolut

Revolut is an aspiring private digital bank, maintaining not only card payments, saving schemes, but an array of services like investments or international transfers.

3. Chime

Chime is a financial services company linked to several banks, which offers a highly user-friendly app with a credit card, savings account and absent fees.

4. WeBank

Brought to life by a consortium of tech companies, WeBank is another private bank, devoted to transparent services and working with underbanked groups.

5. Robinhood

A star of last year’s stock craze, Robinhood is a leading commission-free investment app with a variety of tailored financial instruments, with a set of unique income flows.

6. Tinkoff

Made as an experiment for the Russian market, Tinkoff is the region’s digital banking champion, highlighting openness and big data solutions.

7. Brex

An exemplary Silicon Valley unicorn, Brex occupies the growing niche of banking aspiring tech companies, helping with their cash management and credit needs.

8. Sofi

Sofi has been recognised to take a distinct approach, specialising in the credit side of personal finance and investments.

9. Upgrade

A US-focused lending platform in the banking network, Upgrade offers quite a balanced set of credit products to satisfy local demand.

10. Monzo

Monzo has shown to be a convenient saving tool and a digital wallet when it comes to everyday expenses. Its USPs not only feature interesting analytics and transaction speed but also forecasts.

To view the full list of Buy Now Pay Later (BNPL) Unicorns by Market Capitalisation, view our live ranking of the largest Fintech companies.

Which countries do the top Challenger Banks come from?

Among the top 20 Challenger banks in our dataset, 7 are from the USA, 6 from the UK, 2 from China, and 1-1 from Argentina, Brazil, Georgia, Germany, and Russia.

What are the trends in the Challenger Bank Sector for 2021-2022?

1.The topmost is not the US or the Uk but Brazil:

The most successful of the challenger banks is a Sao Paulo-based company called Nubank. While no one expects Nubank to dethrone the big five banks, they have forced them to improve their technology and close hundreds of physical locations as customer expectations alter.

2.Europe Leads with Good legislation:

The implementation of open banking, particularly the well-known PSD2, has facilitated the emergence and rapid growth of challenger banks. The United Kingdom, France, and Germany are among the countries leading the trend, with challenger banks such as Revolut leading the way.

3.The USA even after having the most number of Challenger banks lags behind:

The necessary regulatory changes unlike Europe are coming slowly in the USA.

What is the Future of Challenger Banks in the next 5 years?

1. Focused on freelancers and SMEs

Despite the fact that competition with banking institutions is one of the most significant obstacles for SME-focused banks, there is still plenty of room for expansion.

2. Cryptocurrency

Some may argue that cryptocurrencies are the polar opposite of the banking system due to their decentralization, but as more people become aware of cryptocurrencies, demand for a simple and user-friendly financial service will increase.

3.Hyper personalisation

For a long time, mainstream banks have offered some level of personalization in their services. Offering hyper-personalization in banking services will be a game-changer for digital banking in the next years.

The post Top 10 Challenger Banks in 2023 appeared first on CFTE.

Credit cards have been around for a very long time now, so what makes Buy Now Pay Later stand out? Why is it considered a new solution to an unresolved problem?

Indeed, BNPL as its name infers is a Fintech solution that allows consumers to buy an item they want now without being required to pay instantly. It differs from a regular credit card in 2 main ways. First, BNPL arrangements often don’t charge interest or fees as opposed to the whole lifeblood of a credit card. Second, BNPL providers have a fixed repayment schedule—generally several weeks or months, unlike the credit card system which requires a minimum payment due each month on the card balance.

In the wake of the Coronavirus pandemic which accelerated the growth of online shopping, BNPL gained a lot of popularity.

As it stands, the leading BNPL service providers are Affirm, Klarna, Afterpay, and Paypal. Some offer other fintech services as well but have managed to gain huge popularity in the BNPL sector. According to Statista, as of June 2021, Affirm has around 7m active users worldwide, Afterpay has 16m, whereas Klarna has more than 90m. These stats highlight the popularity of BNPL amidst the global pandemic.

Here are the top 9 Buy Now Pay Later Unicorns in 2022 by Market Capitalisation:

1. Affirm

Affirm is a US-based BNPL payment provider which offers a flexible, transparent, and convenient way to pay overtime and allows you to select the payment schedule that works for you, then confirm your loan.

2. Upstart

Upstart is a leading artificial intelligence (AI) lending platform designed to improve access to affordable credit while reducing the risk and costs of lending for our bank partners. It was founded by ex-Googlers.

3. Du Xiaoman FinancialP

Du Xiaoman Financial is a short-term loans and investment services provider. It is also known as Baidu Financial Services Group (FSG), and operates as Baidu’s fintech arm.

4. Green Sky

GreenSky offers loans paid back over weeks and months, usually for large purchases.

5. Ziltch

Ziltch allows you to shop online and pay over time. Alternatively, earn cashback when you pay in-store.

6. Creditas

Creditas is a Brazilian lending business and is currently the largest Fintech for secured loans in Brazil.

7. Zip Co

The Zip digital wallet has two types of interest-free accounts, Zip Pay and Zip Money. These accounts can be used with retail partners online and in-store anywhere Zip is accepted. The company is also the owner and developer of the freeware app Pocketbook, which is one of Australia’s largest non-bank financial apps.

8. DailyPay

DailyPay is an American financial services company founded in 2015, which provides payroll services such as earned wage access.

9. Sunbit

Sunbit is a BNPL technology company. The firm’s services are offered in-store and online across nearly 7,300 locations.

To view the full list of Buy Now Pay Later (BNPL) Unicorns by Market Capitalisation, view our live ranking of the largest Fintech companies.

Which countries do BNPL unicorns come from?

All current BNPL unicorns originated in the Americas. As it stands, 4 out of the 9 present BNPL unicorns were founded in the United States and one was founded in Brazil. Many financial services startups and well-established companies in the US have found success in acquiring BNPL as a service. Indeed, the percentage of Gen Zers in the US using BNPL has grown 6x from 6% in 2019 to 36% in 2021. The US payment landscape has been evolving quickly and consumers have been quick to jump on the latest trends.

However, BNPL’s popularity is not limited to the US, Latin America quickly jumped on the trend with BNPL providers such as Addi expanding and raising funding. In fact, Bogota-based Addi has recently raised $75million in a round of funding. Brazil’s regulatory environment which encourages competitiveness in the financial sector has boosted innovation and made it a hub for Fintech solutions such as BNPL.

Notably, Australia has made it to the list with stats showing that the BNPL Gross Merchandise Value in the country will increase from US$ 7354.4 million in 2020 to reach US$ 52456.2 million by 2028. The BNPL market has been one of the fastest-growing markets in Australia.

Finally, the UK is also a huge adopter of BNPL services. Indeed, a review from the FCA’s Christopher Woolard found that the U.K. BNPL market is worth £2.7 billion ($3.7 billion), with 5 million Brits using such products since the start of the pandemic.

What are the Buy Now Pay Later (BNPL) trends in 2021-2022?

Millions of shoppers now use BNPL service providers to purchase anything they desire instantly. This explains the rise in providers with even big companies deciding to offer BNPL services. Companies such as PayPal, Square, Monzo, Revolut, Amazon, Walmart, and Mastercard are all offering BNPL options at checkout. In fact, BNPL transactions have significantly increased during the COVID-19 pandemic with consumers finding it harder to access credit and with deterring incomes.

Here are some interesting stats:

• BNPL experienced 215% year-over-year growth in the first two months of 2021 according to Adobe.
• Nearly 75% of BNPL users are Generation Z or millennial as they seem to be more cautious about credit in the aftermath of the financial crisis -eMarketer
• According to a survey conducted by the Mercator Advisory Group, adults in the first half of 2021, around 52% of customers aged 18-24 had used BNPL solutions in the past 12 months.
• Roughly 1.5 billion consumers will spend $995 billion through BNPL by 2026.

However, the risks and disadvantages of BNPL have been massively talked about as well. Economists and experts worry that the principle of buying without having the money to pay would eventually worsen credit access and lead to severe defaults. Nonetheless, this innovation has been wildly accepted by both merchants and customers. In the upcoming years, it is worth looking into changes in the regulatory systems.

What is the Future of Buy Now Pay Later (BNPL) in the next 5 years?

The global Buy Now Pay Later market size is expected to reach USD 20.40 billion by 2028, registering a CAGR of 22.4% from 2021 to 2028.

It is predicted that BNPL service providers will take the following steps:

• Sponsor shoppers on their own apps: Brands are starting to promote some products via sponsored listing formats, and pay only when a shopper engages with the ad. For instance, Afterpay will enable its merchant partners to advertise its app to boost their promotions, products, and offers.
• Claim a commission from sales: Today’s merchants will demand accurate attribution statistics to see just how much the BNPL providers are boosting their sales.
• Specialise in a product category: To make the customer journey as smooth and pleasant as possible, BNPL providers will soon specialise in a product category.

Lastly, although this has already started, big tech companies will continue adopting BNPL solutions in an attempt of keeping up with the current Fintech ecosystem.

The post Top 9 Fintech Companies in Buy Now Pay Later | 2023 appeared first on CFTE.

“Crypto will do to banks what email did to the postal industry.”

Crypto has been on the rise ever since the dawn of 2020. While ten years ago, ‘crypto’ was largely an academic concept with most of humanity unaware of its existence, today it stands apart in the popular FinTech Unicorn race. 

COVID-19 stimulated unprecedented lockdowns and economic depressions across the globe, but on the other side of the same coin, stood ideas and startups that transformed into unicorns! In comparison to fintech unicorns worldwide, crypto startups have witnessed an investor frenzy with their market valuation crossing billions every week! 

Here’s the list of the largest Fintech Crypto Companies in 2022 by Market Capitalisation:

1. Coinbase

With the highest market capitalization of more than $50 billion in the humongous club of Crypto Unicorns, Coinbase is an american crypto exchange platform that operates in the online space and has no physical headquarters.

2. FTX

Founded in May 2019 and following the footsteps of Coinbase, FTX is a Bahamian based cryptocurrency exchange platform averaging $10 billion of daily trading volume and has over one million users. It has reached a market capitalization of $25 billion.

3. FalconX

With a market capitalization of more than $3.5 billion and specialising in the field of blockchain, cryptocurrency and fintech, FalconX is a cryptocurrency brokerage and digital asset trading platform. It eliminates slippage and hidden fees through efficient application of data science by its platform.

4. Liquid

Supported by Quoine, a Financial Technology company headquartered in Japan, Liquid is their core product and a highly sophisticated cryptocurrency trading platform facilitating fiats and dozens of cryptocurrencies. With a market capitalization of $3.2 billion, Liquid is one of the largest exchanges in Asia.

5. Blockfi

A secured non bank lender and New Jersey-based financial services firm for crypto users managed to close its Series D funding round at a staggering $350 million in March 2021, setting its value at $3 billion.

6. Bitso

With a market capitalization of more than $2 billion, Bitso is a Mexican cryptocurrency exchange founded in 2014. It is the first crypto unicorn in Latin America.

7. Fireblocks

Founded in 2018 and with a market cap of more than $2 billion, Fireblocks is a platform that protects digital assets in transit, focusing on protecting the transmission of customers’ digital assets between exchanges, counter brokers, hot wallets, and cold stores. 

8. Mercado Bitcoin

Mercado Bitcoin describes itself as an alternative asset trading platform in Latin America and supports Brazilian Reals (BRL), offering BRL pairs for BTC, ETH, XRP, BCH, LTC, and USDC. This explains its market capitalization of $2.1 billion!

9. CoinSwitch

Exclusively for the Indian market, CoinSwitch is an app-based cryptocurrency exchange which is available as a mobile application. With a market cap of almost $2 billion,  it supports trade in 100+ cryptocurrencies including Bitcoin, Ethereum, Litecoin, Ripple, Dash and others using Indian Rupees.

10. Ramp

With a mission to create an easily accessible connection between the open blockchain financial system and the old, closed banking system, Ramp connects blockchain with banks using open banking APIs. In 2021, it has a market capitalization of $1.6 billion!

Which countries do crypto unicorns come from?

While we hear news of countries like India drafting bills to accommodate crypto in their monetary system, at the same time, some countries have outright expressed their hostility towards it, for instance, China banning cryptocurrency in spite of rising crypto fans in the country. In such a scenario, as crypto’s popular face, Bitcoin, continues to attract mainstream attention, the crypto-centric startups are climbing the ladder of funding from Venture Capital firms and transitioning into ‘Unicorns’. 

Crossing the $1 billion mark by leaps and bounds, the United States stands proudly as the ground zero of 10 new crypto unicorns in 2021. Finding their niche in the crypto space, India and Brazil have contributed with 2 crypto unicorns each; Singapore has contributed with one crypto unicorn, and even China have contributed to the global crypto space with 2 crypto unicorns! 

The US is the largest economy in the world implying a large number of potential customers and revenue. With startup friendly policies and Silicon Valley- the heart of VCs, US offers capital;expertise and the environment supportive of companies aiming to find their niche in a relatively unexplored yet growing crypto market.

What are the Crypto trends for 2021-2022?

Crypto as a sector isn’t new, but the rising investor frenzy surrounding it has been the standout point of 2021 and will continue to be in 2022. 

Some of the notable trends and developments are as follows:

• Institutional Adoption

There has been an institutional adoption of Crypto and there is also an increasing regulatory clarity observed. The declaration of Bitcoin as legal tender by El Salvador makes a good example.

• Integration of Blockchain and AI

The integration of blockchain and artificial intelligence has facilitated more security and preference to technological partnerships. Previously known as Facebook, ‘Meta’ has cryptocurrency projects underway like Diem and the recently launched Novi Wallet.

• Focus Beyond the Ability to Hold Crypto

Initially companies were focussed on how they could buy or hold crypto. Coinbase is a worthy instance of this and is now a unicorn. 

• Decentralized Finance – A New Way of Thinking

The focus then shifted to Decentralized Finance (DeFi) wherein these companies attempted to recreate traditional financial models like being able to ‘loan cryptocurrency’ and ‘receive interest’. 

• Foray of NFTs as the Face of Innovating in Crypto

This was followed by NFTs or ‘Non Fungible Tokens’ which have forayed in 2021. When it comes to innovation, the crypto space is yet to see a lot!

As mentioned earlier, FTX, the crypto exchange is valued at $25 billion. This is a fact. Well, the fun fact is it made its CEO a billionaire so much so that he rivalled Mark Zuckerberg’s wealth!

What is the Future of Crypto in the next 5 years?

The rising interest in investment in the crypto sector could lead to a great deal of diversification in the industry, for instance, NFTs could be used as collateral for people to take out loans: NFT DeFi. Another sub domain, stable coins, which has witnessed investor interest but at the same time, faces regulatory risk could see an increase in preference.

The following projections have been made regarding the growth of the crypto sector:

• According to Statista, the world is predicted to spend up to $15.9 billion in blockchain related tech by 2023.
• By 2026, the digital currency global market size will be around $1087 million. There will be a CAGR of 3.5% between 2021 and 2026.

With everything dependent on price movements and investor sentiment, the crypto market is a volatile one but it is like any other system trying to survive. Issues will develop but as long as they are resolved, the crypto market will take shape in the long run.

The post Top 10 Fintech Companies in Crypto | 2023 appeared first on CFTE.

The world of banking, payments and financial services as a whole is being taken over by financial technology. Innovator firms, both small and large, have been challenging the system since 2008, and today one could spot that a massive share of customers, those who used to inhabit existing ecosystems and those who did not have access to that, is now a part of, or flows into, the new landscape. 

By the Numbers: Fintechs Dominate Banks

As one could see from the graph above, we have compared the customer bases of top enterprises within both categories and cross-compared them as well. Though, it has to be highlighted that the business models and customer segments served are not consistent for the companies presented, nor the value sources. What is clear though is that, when summed together, the top 10 Fintechs provide service to a customer base that is 350% (5,791mln vs 1,652mln) larger than that of traditional institutions, and it’s given that Fintechs as a phenomenon were not there 10 years ago.

When it comes to cross-comparison, 7/10 Fintech entities have a higher volume of customers, and, in some cases, this divergence is stark. For instance, a payments champion, Visa, has managed to tap on 36.87 times larger volume of consumers, when set against JP Morgan Chase. On the other hand, when values for the Agricultural Bank of China are compared to a fast-growing unicorn Stripe, one might wonder what brings these entities together. Modest 2mln customers would not be able to rival 320mln million. That’s what was the case just several years ago. However, when market capitalisation comes in, things change dramatically. The following section will unravel some of the factors that allowed for this standoff.

Fuel for Fintech Growth

Thanks to the growth of capital markets, hatching narrow segments of customer groups, technological advancements and general discontent of the community about the financial system, small businesses with an innovative idea and a team with developer expertise can shoot for the stars to compete with massive conglomerates. For the former, UK venture capital investment volume has jumped from $37.4bln in 2007 to $135.6bln in 2019 (OECD, n.d.), what offers a remarkable growth of 263%.

Whether that was the openness of foreign markets, easing access to the public or the investor rush for a new garage Google, opportunities for “cashful” growth and escape from bootstrapping have sprouted dramatically. Previous obstructions to setting up a tech unicorn were also diminished by existing financial institutions, which had to renovate their legacy systems or build something new. So just as crocs needed tiny plover birds to get rid of struck food, industry whales had to spend a share of their budgets to bring to light some of those challengers. In addition, internet-driven global access has united and unravelled niche markets for consumers, the future fuel for the growth of narrow-specialised businesses, a phenomenon, later referred to as Amazonification.

In the meantime, web interconnectedness, channelled through old Web 1.0 APIs and aspiring Web 2.0/Blockchain APIs, brought in problems to be solved by innovator businesses and rife competition, as infrastructure became more transparent. To add to it, after the market crash of 2008, many people lost faith in traditional financial institutions, being attracted by the new entities, deemed creative or novel, whether that would be a digital wallet like Paypal or the system of agentless value transfers like Bitcoin and its successors.

Are Fintechs Taking Over?

Nevertheless, concluding that Fintech firms would completely capture the market in the coming years would be hasty. There are several aspects in place that could hamper the total transformation of the financial landscape. First, the reality that market entities are facing is that both types of institutions have to work together to deliver better services. For the new generation of institutions, it has proven to be more efficient to assist older counterparts in improving their legacy systems or mostly tackling the issues of segments, hardly served by incumbents. Here also takes place the factor of global M&A markets, whereby wealthier whales maintain their shares by acquiring potential rivals or developing them themselves within the ecosystem.

Second, the regulatory environment, keen on being lobbied and protective of the big financial services providers, is very unlikely to leave this development unsupervised. Third, since the late 1980s, the global society has been seeing the age of vertical hypercompetition, whereby institutions tend to compete rather as coalitions than individual businesses. Therefore, unless the unfolding wave of disintermediation scales up, aspiring Fintechs are unlikely to reach the peak of their potential. However, it might be that hype for the new technology and people’s finance would overcome these barriers. Thus, it would be interesting to observe the future direction of trends.

The post The Top Fintechs Have a 350% Larger Customer Base than the Largest Banks appeared first on CFTE.

The emerging industry of fintech has revolutionised traditional finance, including services such as fintech payment companies. The payments sector has contributed to the growing trend of implementing technology to improve efficiency, security, and consumer satisfaction in financial services.

Here are the Top 10 Largest Payments Companies in 2022:

Find the complete ranking of payments companies in fintech in our full list of fintech unicorns by market capitalisation

Which countries do Payments unicorns come from?

Countries with the largest Payments unicorns include the United States (19 unicorns), the United Kingdom (8 unicorns), India (5 unicorns) and Israel (4 unicorns).

Payment solutions and their penetration level is substantial due to the surge of online transactions caused by the pandemic. Furthermore, the capitalisation of projects focusing on online payments also contributed to the surge.

What were the biggest trends in Payments in 2021-2022?

According to Finaria.it, the global digital payments industry is expected to hit $6.6 trillion in value in 2021.

The top 5 trends in payments:

• Rise in Innovative Payment Products

Globally, people today are trying to go contactless in every possible area. Products such as NFC and EMV, where things like tap and go QR codes and contactless cards would are more popular than ever.

• Focus on stronger security

Due to increasing cybersecurity threat, improving existing cybersecurity framework is a must. The best approaches that are currently being taken is AI (Artificial Intelligence) and ML (Machine Learning) powered systems.

• Integrated Payments

According to Accenture, 50% of adults are comfortable letting third party’s initiate payments on their behalf, mainly due to the offering of a seamless checkout experience for customers.

• B2B Payments Redefined

Integrated payments will allow the B2B payments sector to connect with payment facilitators and take a revenue cut from the transaction cost.

• Evolution of P2P payments

Platforms like PayPal and Stripe have seen a growth in popularity with their customers broadening from tech-savvy millennials to older generations. The pandemic contributed to this, making the platforms see a surge in their average transaction volumes

What is the future of Payments in the next 5 years?

According to analysis by PwC and Strategy&, Global cashless payment volumes are set to increase by more than 80% from 2020 to 2025. Figures include about 1tn transactions to almost 1.9tn, and to almost triple by 2030.

With respect to continients:

• Asia-Pacific will have cashless transaction volume growing by 109% until 2025 and then by 76% percent from 2025 to 2030
• Africa will have cashless transaction volume growing 78% until 2025, 64% from 2025 to 2030
• Europe will have cashless transaction volume growing 64%, 39% from 2025 to 2030
• Latin America will have cashless transaction volume growing 52%, 48% from 2025 to 2030
• US and Canada growing least rapidly at 43% until 2025, 35% from 2025 to 2030

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