Chinese fintech stars are rising, says global report
The UK has made a good showing in a new report, the Fintech 100, with 12 start-ups from the UK’s fintech ecosystem featuring on the report’s 50 “Emerging Stars” list – the most from any single country – but the Chinese are fast catching up.
The report has been produced by Fintech Innovators, a collaboration between fintech investment firm H2 Ventures and KPMG Fintech. It includes the leading 50 Established fintech companies across the globe, as well as the Emerging Stars.
The authors say that the rise of Chinese fintechs is a “standout this year”, with Shanghai-based ZhongAn taking the top spot in the 50 Established Innovators list, and Qufengi fourth. Last year WeCash was the only representative from China to appear on the list. This year there are seven Chinese companies in the Fintech 100, reflecting increased venture capital levels and interest in China’s fintech sector.
Featuring on the 50 Established Innovators list are UK peer-to-peer lending platform Funding Circle (5th position), new digital Atom Bank (8th), iZettle (27th) a mobile payments company, eToro (34), a trading marketplace, Nutmeg (42), the online investment service and TransferWise (46) a peer-to-peer money transfer service.
The 12 fintech are Bankable, Ebury, Elliptic, GoCardless, GoHenry, Osper, Property Partner, Revolut, Salary Finance, SyndicateRoom, The Currency Cloud and Yoyo Wallet.
Globally, fintech financing has jumped six-fold over the past three years with more than $20 billion estimated to be reached in 2015, a 66% increase on 2014 ($12 billion).
The Fintech 100 includes 40 companies from The Americas (40%), 20 from EMEA 20%), 18 companies from the UK (18%), and22 from the Asia-Pacific region 22%), including 10 from Australia and NZ (10%).
“The UK is clearly a leading centre for fintech but with the rise of Chinese firms that position is not guaranteed. The good news is the UK is currently home to more emerging fintech companies on the list than anywhere else. In a fast moving sector, it will be interesting to track how many break out over the next 12 months,” says Warren Mead, global co-lead of KPMG’s Fintech practice.
“The speed and energy with which fintech innovation is impacting financial services is gathering global momentum on many measures. This year’s report underscores the international nature of fintech, with the broad geographic diversity of the fintech companies featured. It is the Fintech 100 companies that are pushing the frontier of new products, services, technology and business models in financial services. Those within the financial services sector who ignore the innovations of the Fintech 100 cohort do so at their peril.”
Toby Heap of H2 Ventures says: “In an industry that will soon be irrevocably changed by the disruptive effect of innovation, the companies doing fintech best are those most likely to succeed. Already, some of the world’s major financial centres are equally becoming known as centres for fintech innovation: London and New York, and more recently Sydney.
“This year’s Fintech 100 highlights the truly global nature of fintech innovation, with start-ups from 20 countries on the list. Many of these companies have an X-factor that has captured our attention – exciting new fintechs with bold, disruptive and potentially game-changing ideas.”
Key highlights from the Fintech 100 report include:
Funding boom – The Fintech 100 companies have collectively raised in excess of US$10 billion.
Fintech is now truly a global sector – The list is comprised of 40 US companies, 20 from EMEA, 18 from the UK and 22 from ASPAC.
China fintech leads the world – Zhong An, a Chinese company, tops this year’s list, and there are seven Chinese fintech companies on the list.
Australia is punching above its weight – Australia’s Society One and Prospa appear in the top 50 Established fintechs; and there are seven Australian companies in the Emerging Stars list.
Payments is most at risk of disruption – Fintech growth in payments, currencies and transactions sees this segment now representing 25% of the Fintech 100, a substantial uplift on last year.
Insurance finds its fintech footing – The top two companies on the list are insurance fintechs (with 7 overall, compared to none last year).
Shift from disruptors to enablers – There are 25 ‘enablers’ (i.e. service providers to financial institutions) on the list this year, compared to seven last year.
The full report can be found at www.fintechinnovators.com