The intersection between finance and technology seems inevitable as we forge into the second decade of the 21st century.
The emerging Fintech industry comes with so much to know and learn, from how secure it is, to whether you should invest in it or not, to the role it plays in everyday people’s lives.
By reviewing fintech statistics, the picture of this innovative approach to the financial world can become more explicit, perhaps removing some of the distrust or confusion surrounding it.
Especially after the year 2020 and the effects of the pandemic on the economy, it’s helpful to know what’s going on with this novel market, especially as life becomes less face-to-face and more screen-to-screen.
Hand-Picked Most Telling Fintech Stats in 2021 (Editor’s Choice)
- 79% of smartphone users have purchased something online via their mobile device in the past six months
- The global value of fintech investment was $105 billion in 2020
- In 2020’s first quarter (Q1), Venture Capital for fintech dropped to $6.1 billion
- Globally, startup Venture Capital in Q3 2020 surpassed $80 billion
- The banking industry will invest in blockchain at a five-year CAGR of 45.3%
- E-commerce fintech will grow at a 10-12% CAGR until 2025
- 60% of credit unions and 49% of banks in the U.S. find Fintech partnerships important
- There have been 115 fintech unicorns since 2000
Fintech Usage Statistics
From ordering groceries online during a pandemic to pre-booking vacations to using your internet banking application, Fintech is becoming a standard of financial services for everyone.
1. In the last six months, 79% of smartphone users have bought something online via their mobile device.
With more than three-quarters of the US population owning a smartphone or tablet, the integration of financial services and mobile devices is a leading headline in Fintech. Smartphones are making banking convenient, and shopping is now something you can do anytime, anywhere.
According to FinTech app statistics, the vast majority of mobile device users have used their phone to complete a financial transaction, securing mobile financial technology as an integral part of ecommerce and everyday life.
2. 96% of all consumers are aware of at least one fintech company or service.
The fintech industry is increasingly pervasive as usability comes closer and closer to the everyday consumer.
With a considerable adoption growth of fintech solutions and services, the industry’s players are becoming more well-known worldwide. Thanks to considerable progress in boosting the use of fintech services, some companies and services are turning into household names.
Fintech consumer statistics show us just how much progress has been made. Not only does everyone know about at least one fintech company or service, but 75% of consumers use fintech on a regular basis!
3. 68% of consumers worldwide would opt for a non-financial service provider for their financial needs.
The introduction of fintech into the global market has provided alternatives to financial products and services that were previously only offered through the traditional banking system. Fintech usage statistics show that many non-financial service providers are now offering financial products.
With the adoption rate growing from 33% to 68% in the last three years, consumers are showing trust for fintech services opting for easier, faster, and more convenient alternatives to traditional forms of banking.
4. 49% of banks and 60% of credit unions in the United States find a partnership with fintech to be important.
Fintech is a revolutionary movement in the financial world. It makes money handling easier and cheaper for its users and streamlines many processes, shaving off costs for service providers.
It’s no wonder that fintech statistics reveal a keenness of traditional banks to ally themselves with fintech services. Almost half of banks in the US believe they must join up with fintech, lest they lose business due to a lack of modern, straightforward, and user-friendly solutions.
5. The banking industry will roll out blockchain investment at a 45.3% five-year CAGR
Blockchain technology is an emerging data-keeping solution quickly seeing a lot of attention from various industries. Fintech spending statistics show the financial sector (banking in particular) is especially eager to take advantage of it due to its heightened security features and increased ability to protect against fraud.
In fact, banking will account for more than a quarter of all blockchain spending in 2021. Here are a few driving applications for blockchain in banking:
- transaction agreements
- trade finance and post-trade/transaction settlements
- cross-border payments and settlements
Fintech Growth Stats
Fintech is arguably the most influential and fastest-growing industry in today’s world. Especially with the economic and political impact of COVID-19, fintech was one of the few industries that actually maintained growth as an industry, rather than recessing like so many others.
6. The value of the global fintech market is predicted to reach $309.98 billion by 2022.
Fintech is expected to expand at a rapid rate leading up to 2022. The estimated CAGR (compound annual growth rate) for this increase is 24.8%, and according to fintech growth stats, one of the major drivers of this growth is increased consumer interest in the digital payment sector.
Digital payment is becoming the new standard of how everyday people handle their money. It provides solutions to long-standing problems in the financial industry such as convenience, access, speed of transactions, personal security, and cost-efficiency.
7. The global value of fintech investment was approximately $105 billion in 2020.
2020 wasn’t the greatest year for fintech investment, considering the impact of the pandemic on the global market. Still, it reached over $100 billion, compared to $165 billion from the year before.
Fintech investment stats showed that VC (Venture Capital) has continued to increase each year, despite current events. VC investments, while stalled slightly in the first quarter of 2020, have grown over all stages throughout the last year, indicating that fintech is more important to consumers than ever before.
8. There are 96 fintech unicorns around the world.
A unicorn in the business world is a privately held startup company worth over $1 billion.
Unicorns get their name for their rarity, but according to current fintech stats, fintech currently beats every other industry when it comes to how many startups have exceeded the value of $1 billion. At 17% of fintech businesses named unicorns, only the internet software industry can even try and compete (at 16%).
9. The fintech lending industry will reach a value of $396.8 billion by 2024.
The field of fintech lending does away with banking as a third-party intermediary, connecting the lender and borrower directly, increasing the speed of any transaction by trimming the fat of bureaucracy.
For these reasons, the fintech lending sector expects healthy growth in the following years. Fintech lending statistics point to a projected CAGR of 9.1%. Peer-to-peer lending will be among the fastest-growing segments, with a projected value of $297.6 billion by 2024.
10. The global mobile payment market share in 2027 will amount to $12.6 trillion.
(Allied Market Research)
In a market beset by COVID-19, contactless payments have dominated the payment sector, spurring growth, even in a tough economy, and further normalizing the use of mobile payment as a standard of choice for many consumers.
For example, in 2019, the global mobile payment market was worth an estimated $1.48 trillion. Fintech development statistics, however, forecast a bewildering CAGR of 30.1% in the projected period 2020 to 2027, just seven years to see a growth of over one third.
11. Ecommerce fintech will expand at a CAGR of 10-12% up to 2025.
Ecommerce, spearheaded by the likes of Amazon, eBay, and Alibaba, is a sprawling industry that allows for convenient buying and selling of goods over the Internet. As such, it’s easy to see why fintech statistics suggest it’s the main catalyst for fintech’s growth in popularity.
Ecommerce is in for an impressive CAGR over the next few years for two main reasons; accessibility and usability.
The growing accessibility of e-stores on mobile devices has dramatically boosted the number of people making online purchases. Online shopping is becoming a customized and user-friendly experience, making it more likely to be adopted by users than ever before.
The Best Fintech Stats of 2020
12. Fintech venture capital funding dropped to $6.1 billion in Q1 of 2020.
Like most markets during the first stages of the global pandemic, many investors reeled back, waiting for the effects of the economic downturn to stabilize before continuing business as usual. As a result, fintech VC funding dropped substantially in the first and second quarter of 2020, stalling the momentum built up in Q4 in 2019.
According to fintech fundraising statistics on VC funding, 2020’s first quarter saw a record low since 2016, peaking at just 404 deals.
13. Global VC for startups in Q3 2020 exceeded $80 billion.
2020 was an unexpected year for VC investment. While tech markets suffered all-time investment lows throughout the entire year, global VC investments recovered miraculously from the expected lulls of Q1 and Q2. According to fintech startup stats, 2020’s third quarter showed more success, especially in late-stage development projects than the year before.
14. There were 216 Initial Public Offerings (IPO) in 2020.
(Crowdfund Insider, Investopedia)
IPO is a big step for any company, as it usually marks a level of success that ensures they can be responsible to public shareholders and stand to raise capital from the public. The number of company’s that declare IPO annually is a significant health indicator of any market, including fintech.
Fintech IPO statistics report that instances of IPO in the year 2020 were relatively amicable, amassing a collective $78.1 billion with many deals valuing over $1 billion. The year 2021, however, has great potential to exceed this exponentially.
It is predicted that 2021 will be a monstrous year for IPO, with companies like Coinbase and SoFi taking advantage of the current economic and political climate and declaring their intent to go public
The Top 3 Fintech Company Statistics in 2021
15. As of 2021, 1.96 million websites are using Stripe.
Stripe is an online payment processing software and is currently the largest valued private Fintech company in the US, reaching 95 billion dollars this year. Stripe is unique in its model because it doesn’t just target individual consumers but focuses on helping small (and mega) businesses conduct online payments.
It makes its money by taking a transaction fee of 2.9% + 30 cents proving to be a lucrative decision, as it reached its unicorn status in just under three years and quickly expanded to an international status.
Recent fintech employment statistics report that 2,500 people currently work for Stripe, and they are looking to hire almost 1,000 more this year. This shows that fintech is more than just a fad in today’s modern market, but a top business exponentially expanding, despite the challenges faced in the global-political climate.
16. Klarna is one of the first fintech’s to receive a banking license in Europe
Founded in Sweden in 2005 as a cryptocurrency platform looking to make online shopping easier for consumers, this company is marking the way to creating a completely new and innovative banking system worldwide. As one of the largest fintech companies, Klarna quickly became an international bank, with over 60 million customers and 70,000 merchants.
The company is worth $31 billion to date and processes over 1 million transactions every day. The awarding of bank licenses to fintech companies is contingent on each country’s financial regulations, and yet, there does seem to be a global domino effect of fintech’s achieving certified banking status since 2019.
17. Kraken is the 2nd-largest cryptocurrency exchange in the U.S. by transaction volume
Companies like Kraken are central components of the fintech ecosystem. They disrupt the status quo of traditional financial services and connect with other fintech services to provide a sustainable financial network.
Based in San Francisco, Kraken is one of the first cryptocurrency exchange platforms to ever exist. Founded in 2011, this company is worth $20 billion and is also on its way to becoming its own legitimized bank.
Kraken received its own banking charter in September of 2020, making it the first crypto-firm to be approved in the US to produce its own banking products.
Fintech Statistics: Conclusion
With more and more people using Fintech on their phones and at home for their everyday retail and financial services, there’s no doubt that this technology is fast transforming the ways the world thinks and deals with money.
Especially in unprecedented times as the world faces a global pandemic and opts for less in-person business transactions, fintech has been one of the only markets that has seen growth, rather than a deficit for the years of 2020 and so far in 2021.
Fintech world statistics show that both businesses and everyday people are saying yes, to fintech. With top companies like Klarna and Kraken gaining legitimacy as bonafide banks, there’s no question any more; fintech is here to stay and making it faster and easier to take care of your finances.
People Also Ask
Fintech boasts a line of benefits for both its users and its suppliers. It allows people to complete transactions with their mobile phones and tablets, which improves customer experience and efficiency.
It allows for integrations between banks and various other financial institutions, reducing compliance costs and interrupting the traditional forms of banking that are currently in place.
The name “fintech” is a combination of the words “financial” and “technology,” which refers to the technological innovations used to disrupt the normal modes of financial services, such as the invention of cryptocurrency, ecommerce, online banking services, and debtless lending.
The bulk of the available data shows that China is the country with the most fintech users. In 2017, 69% of China’s population used fintech technology.
Beyond having a broad user base, China is generally a hub for the fintech industry. For example, eight fintech companies from China have a combined valuation of $96.4 billion.
Fintech is a growing industry with many companies to choose from, but like any market, there are some top-runners to keep an eye on.
- Gravity Payments
- Varo Money
- Juniper Square
- JPMorgan Chase
These companies are at the top of their respective niches at the moment. They’re among the primary drivers of innovation and adoption within the realm of fintech.
There are numerous examples of fintech that serve a variety of purposes.
For example, services like Patreon, Kickstarter, GoFundMe are fintech companies adept at crowdfunding. Meanwhile, cryptocurrencies such as Bitcoin, Ethereum, or Litecoin act as digital cash alternatives to standard bank systems.
Seeing that it combines financial operations with technological solutions (that being money transactions and payments online), PayPal is indeed a fintech service.
Not only that, but it’s also one of the most popular fintech service providers in the world. It’s available in around 200 countries and used by more than 300 million people. Every year, it hosts billions of payments on its platform.
Fintech can improve the efficiency of the myriad of financial processes that occur on a daily basis while also reducing operating costs for both the providers and the users. Cryptocurrency would be a good example of streamlining financial services as they remove the need for third-party authorization.
Furthermore, fintech allows integration with more financial services, thus improving user experience. Ant Financial, for instance, is an all-in-one service that allows for payments, savings, and investments.
Since it’s such a new institution, fintech lacks a centralized regulator. Rather, it currently falls on the shoulders of several organizations to keep a tight leash on fintech companies.
Some of the organizations that work to regulate fintech companies include:
- Consumer Financial Protection Bureau (CFPB)
- Federal Deposit Insurance Corporation (FDIC)
- Office of the Comptroller of the Currency (OCC)
- Commodity Futures Trading Commission (CFTC)
- The Conference of State Bank Supervisors (CSBS)
Amazon engages in a wide variety of fintech tools and services, focusing on lending, cash, and payments, among other things. Amazon Pay is a great example of the company branching out into more fintech endeavors.
Amazon’s original purpose was to be an e-commerce platform, which very much falls into the purview of fintech. Considering company’s overall fintech statistics, we can say Amazon is definitely a fintech company.