The Future of Global Fintech: From Rapid Expansion to Sustainable Growth (Second Edition) (Cambridge Centre for Alternative Finance / WEF)

Summary

• The study surveyed 240 fintech companies across six business verticals and six regions.p.4
• Average fintech customer growth was 37% from 2022-2023, down from 55% in 2020-2021 and 52% in 2021-2022.p.10
• The average revenue growth rate in 2023 was 40%.p.11
• The fintech sector showed an average profit growth rate of 39%.p.12
• 84% of surveyed fintechs partner with incumbent financial institutions, most commonly through API integrations (52%).p.4
• MSMEs remain the largest underserved customer segment (57%), followed by low-income (47%) and women (41%).p.30
• Only 11% of fintechs viewed the regulatory environment as unsupportive, against 47% in the first edition.p.14

Key insights

1. 90% of fintechs viewed consumer demand as either very supportive (37%) or supportive (53%) of their growth.p.14
2. 47% of fintechs reported that the funding environment somewhat or significantly improved, while 38% in EMDEs and 34% in AEs said it had worsened.p.19
3. 55% of fintechs plan to enter new markets, with 60% of AEs planning international expansion compared to 49% of EMDEs.p.20
4. The top cross-border barriers are complex regulatory and licensing requirements (68%), adapting products to local markets (58%) and establishing local partnerships (48%).p.21
5. Nearly 85% of fintechs rated reporting and compliance processes as adequate or strong.p.25
6. eKYC or simplified due diligence (50%) and fast retail payment systems (46%) were rated the most effective supporting mechanisms.p.27
7. Open banking and open finance regimes are expanding globally, with 95 countries having some form of implementation.p.28
8. Low-income customers contributed 43% of fintech revenue in 2023, against 26% in 2022.p.31
9. US and Canada fintechs led customer growth at 44%, while SSA lagged at 21%.p.10