Following a difficult period for fintechs worldwide, some of the first signs of a potentially turning tide have emerged as 77 per cent of fintechs anticipate at least moderate growth this year.
Digital banking and payment services company Discover has released part of its ‘Fintech State of the Union‘ report, featuring global insights on the fintech landscape. The report reveals that 34 per cent of fintechs anticipate significant growth this year, while another 43 per cent predict moderate growth.
Fifty-five per cent of venture capitalists also said the growth outlook for the technology sector over the next five years is very strong and 47 per cent say the same for fintech.
Meanwhile, 93 per cent of fintechs explained that the current economic environment has increased their business’s reliance on payments networks. Fintechs are looking for payment partners who are flexible (44 per cent) and innovative (44 per cent). Fintechs also revealed they benefit from payment networks the most through financial investment (42 per cent), access to customers (38 per cent), and technology enablement (38 per cent).
Matt Sloan, head of business development at Discover, commented on the findings: “As a payments network, it’s exciting to see both fintechs and venture capitalists lean into partnerships with networks as a way to provide new and seamless payments experiences for their audiences. By partnering together, we can work to find solutions and enhance the payments ecosystem.”
Regarding payment use cases, the Discover study also highlights that fintechs continue to find relevance in different technologies that extend to both consumer and B2B audiences. Payment data security (90 per cent), payment acceptance (89 per cent) and contactless payments (85 per cent) are incredibly important, with a majority of respondents seeing these payment use cases as relevant to their business. Additionally, fintechs find B2B use cases for automation (87 per cent), digital or virtual cards (86 per cent) and payroll (84 per cent) relevant to their business.
Jordan McKee, director of payments research and advisory at 451 Research, said: “This is an interesting moment in time for fintechs and this year’s study revealed they’re more confident than ever in their growth potential. As fintechs embrace emerging technologies and strategically partner with payments networks, the industry will become stronger and create a better, more seamless experience for customers worldwide.”
“The global fintech ecosystem continues to expand and diversify in the face of macroeconomic challenges. In order to help organisations reach their true potential, Discover Global Network is committed to being a trusted partner for fintechs, helping to expand their global reach through our unique set of payment capabilities and solutions.”