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KPMG and H2 Ventures Report on Trends to Watch in Fintech Industry

Science & Technology

Jean Langlois

Mon, 23 Dec 2019 16:54 GMT

International consulting and auditing giant KPMG and the early stage Australian venture capital firm H2 Ventures which invests in fintech, data and artificial intelligence, have just published a joint report ‘The 2019 FinTech 100’ which analyses the year’s most innovative financial technologies in the world.

The report is split into two main categories: The ‘Leading 50’ and the ‘Emerging 50’. The first takes a close look at the top 50 fintech start-ups around the world whose ranking is based on innovation, the activity of raising capital, their size and their scope. The second category explores avant-garde start-ups that offer disruptive new business models, based on the capacity for innovation of the products and services offered.

As Aliénor Dumont a young Parisian start-up founder working in the fintech sector explained to 7Dnews, “The immense interest of this report is that it allows us to understand the main trends in the field of Fintechs. As a French entrepreneur I must say that I was very excited to read that some famous French start-ups had entered the ranking".

At least three main trends are realised through this report; that new technologies are globalising; payment services remain the leading sector and France is becoming an increasingly prominent player.

When you think fintech, think global

The development of companies specialising in the field of new financial technologies can not be limited to a regional and / or national approach.

If we take the example of OakNorth, a company founded by the brilliant entrepreneur Rishi Khosla, one of the winning strategies of the management team was obviously not to focus only on the English market but also to look into new growth drivers in other countries and even other continents.

We also take into account, Monzo, a fairly new bank which is the genius of Tom Blomfield. As soon as his business had reached a critical size he decided to embark on a global conquest. While this bank was only founded in 2015, it now has 2 million customers in Great Britain and it is beginning to open up to the North American market.

The competitiveness of fintechs is definitely on the world stage but in the Asia-Pacific region continue to dominate globally.. If China remains strong, the top 8 ranking companies is made up of 7 Asian Fintechs including two Indian (Paytm and Ola), confirming the emergence of India among the major players. "On the other hand, with 32 referenced players, Europe confirms its importance on the market characterised by diversified and disruptive projects", said Fabrice Odent, KPMG partner, responsible for the banking sector.

Payment solutions are still the majority

It is the Fintechs that offer payment, loan, and brokerage services that continue to be the best performing and most represented — with 27, 15 and 19 companies in the ranking, respectively. Insurtechs are also still well represented with 17 companies listed; up from 2018 which listed 12. This year is particularly marked by the development of neobanks with 9 companies listed in the ranking. We can also note the growing number of ‘Multi’ players, fintechs offering a range of diversified financial services to their customers.

French fintechs enter the global competition

"The new French players are involved in various Fintech businesses — payment services, assurtech, crypto-assets — and this new edition confirms the sectoral diversification observed in France", said Stéphane Dehaies, Financial Services partner and head of the Fintech KPMG France practice . "We are seeing more and more complete coverage of the financial services needs of companies by new players, specialists in a specific product and distinguished by the ease of access to the solution and the transparency of pricing."

Four French fintechs are listed in the "Emerging 50" part of the ranking. This confirms a trend in recent years with the presence of many national companies among the avant-garde players in the study. The start-ups which entered the ranking this year are Dether Lunchr, Moonshot and Spendesk.