Global Fintech SaaS is projected to grow with a CAGR of 25% between 2021 and 2027. The market is projected to reach USD 300 billion by 2027.
Fintech is a term that refers to a mix of technology and financial services that has revolutionized how organizations function. The financial technology sector has grown significantly in recent years, leading to a shift in corporate practices toward a customer-centric strategy. As a result, you'll be able to find work in a wide range of firms, from start-ups to established corporations, all around the world. Financial services and technology firms have chosen opposite courses and grown with inventive and disruptive tactics in a constantly changing business environment, using either a collaborative or demanding attitude. Fintech, or financial technology, is an innovation that is gaining traction throughout the world by replacing traditional financial services in areas like payments, electronic commerce, banking, social commerce, wealth management, and others. Because e-commerce is quickly growing throughout the globe, it has surpassed the primary application area of the FinTech industry, which is predicted to develop at a phenomenal annual rate of over 12% until 2026.
Insurtech, Regtech, payment services, and other fintech versions have evolved in recent years that leverage cutting-edge technology suited for certain purposes or industries, such as Insurtech, Regtech, and payment services. Now that the fintech business has shown to be more than a fad, the level of execution attained in an organization's plan is becoming increasingly important. The Fintech industry's technological component is quickly expanding. Fintech companies are increasingly relying on technology such as Blockchain, Application Programming Interface (API), Robotic Process Automation, and Data Analytics, among other things, to improve their agility, efficiency, and accuracy.
Currently, prominent financial institutions with a long history in the financial sector are attempting to extend their market by collaborating with developing technologies. Similarly, FinTech firms are forming partnerships with major and well-established financial institutions to expand their market. As a result, mergers and acquisitions are becoming more common in the FinTech industry. The Major participants of the industry are; Ant Financials, Zhong An, Atom Bank, SoFi, Paypal, Coinbase, Robinhood, Adyen, etc.
FinTech Improves the Security of Financial Information
In the field of information technology, cybersecurity is becoming a major concern. Organizations are subject to financial loss as a result of cyber-attacks, hence FinTech is a priority. FinTech not only maintains the security of financial data but also facilitates transactions, resulting in seamless financial operations and optimal cash flow.
The Ever-Increasing Need for Mobile Banking Apps
In today's world, every bank has its mobile application that allows consumers to do online transactions and send money to other users all over the world. This provides a sizable FinTech market for providers to cash in on-demand from both old and new banks. Regulators with severe laws that limit the operability of FinTech apps have unfortunately eclipsed the scale of the FinTech business. In addition, there is a noticeable absence of human contact in these applications, which is sometimes paired with the additional convenience costs that apply to transactions, as evidenced by the fact that many accounts opened in FinTech mobile apps remain inactive.
Increasing Stock Market Participation
The outbreak of Covid-19 led to a nationwide lockdown all over the world. This resulted in an increasing number of stock market participants through online brokerage firms. These firms helped the investors to open a Demat account without visiting their office physically. Many traditional brokers are now transitioning into online brokers as it is highly efficient and cost-friendly.
Adoption of Blockchain Technology
Blockchain technology is rapidly being used by companies in the global fintech business to improve security and operational efficiency. Blockchain is a system that entails the creation of a distributed database that is available to all users through a network, with each user having the ability to contribute a new data record (block) with an immutable timestamp. Blockchain technology preserves data authenticity by prohibiting modifications to older data blocks while enabling users to continue contributing new data blocks, resulting in excellent security and transparency for finance firms. It improves trade accuracy, decreases risk, and speeds up the settlement process.
Huge Investments in the Industry
The investing community, as well as large organizations such as Google, Intel, Salesforce, and others, are all interested in FinTech Saas. To build distribution channels and ward off competition from third parties, the banking industry is beginning to embrace FinTech technologies. The overall investment in 2021 will be more than $126 billion.
Lack Of Trust in The Fintech Services Leading to The Adoption of Traditional Broker Services
A large amount of the population is still hesitant to use these fintech services as they are worried about the privacy and security of their data and funds. Traditional brokers are still operational in many parts of the world, this is because many retail and institutional investors hesitate to put a large amount of money in an online Demat account. This could be the result of a lack of human touch.
The market is segmented into fund transfer, personal finance, wealth management, etc. Peer-to-peer money transfers, loan services, internet payments, and mobile payments are examples of FinTech enabled services. Financial institutions can create their solutions, cooperate with FinTech solution providers, or buy them. CAPEX and OPEX variables, in addition to operational concerns and/or user experiences, have a significant effect on these decisions.Online Stock brokerage firms are gaining popularity day by day as it is easily accessible and highly cost-effective. Companies like Robinhood, Zerodha, and Upstox gained millions of Demat account holders during the pandemic in 2020-21.
Robotics Process and Automation
Mobile Commerce and Transfers
Automatic factor discovery, or the machine-based identification of the components that drive outperformance, will become increasingly common in financial services, assisting in the refinement of financial modeling across the industry. Knowledge graphs and graph computing will play a bigger role as a crucial application of AI semantic representation. Their capacity to help form relationships and find patterns across complicated financial networks by combining data from a variety of frequently divergent sources will have far-reaching repercussions in the years ahead.Artificial intelligence (AI) applications are predicted to pervade the financial industry’s front, middle, and back offices. Tailor-made products, personalized user experiences, and analytics services, intelligent service robots and chat interfaces, market trackers, automated transactions, and robot-advisors, as well as alternative credit ratings based on non-financial data and facial recognition authentication, are all examples of customer-facing applications.
The Fintech markets in APAC and the US are now the biggest, with each accounting for moreover 40% of the worldwide market. The EMEA area is much smaller, accounting for less than 20% of the entire market. The Fintech market in APAC is expected to develop at the quickest rate. In the Asia-Pacific area, financial apps are fast gaining popularity. There were over 1230 financial applications accessible in APAC, and marketers spent US$ 244 million on new user acquisitions in 2020 alone. Between Q1 2019 and Q1 2021, there were 2.7 billion installs in APAC. Together with Brazil, India, and Indonesia account for nearly half of all global fintech app downloads.
NOTABLE HAPPENINGS IN THE GLOBAL FINTECH SaaS MARKET IN THE RECENT PAST
Business Investments: - Tencent and Allianz Insight, the primary Venture Capital Investors, spent 524 million euros on FinTech Company N 26 as a later stage Venture capital investment in May 2020. The Mobile Banking Platform is operated by N 26. The second-largest FinTech venture capital investment in Europe was made with this investment.
Business Investments: - Other major investments in the FinTech market in 2020 include Allianz Group's Corporate Venture Capital Allianz X, which wants to invest in digital growth firms that are part of insurance ecosystems, with its most recent investment on BIMA. Mouro Capital CVC, a subsidiary of the Santander Group, is looking to invest in seed, early, and later-stage companies, the most recent of which being Uncapped.
Product Launch: - In April 2021, Angel Broking Ltd launched its online brokerage app called Angel One to cope with the current market demand for online brokerage apps.
Impact Of COVID-19 On The Industry
Various crises have fuelled the growth of the FinTech industry. Fintech investments have risen steadily since the previous global financial crisis. The sector's growth was primarily a technical reaction to the traditional financial services industry's weaknesses, which were exposed during and after the financial crisis. Covid-19, meanwhile, has had a significant influence on the global economy and has triggered a recession. As a result of the crisis, the FinTech business has grown at a breakneck pace. Large financial institutions are cooperating with developing technology companies in reaction to Covid to gain access to the new market. Fintech companies are looking to partner with big banks to increase their market and services. The Fintech market is, in any case, booming.
Following an unexpectedly successful 2021, the first half of 2021 witnessed a big comeback in investment. In 2021, overall investment in the three categories of venture capital, private equity, and mergers and acquisitions is predicted to increase. Similarly, as corporations want to extend their skills and offers and FinTech firms seek to scale, M&A activity is expected to increase significantly. As FinTechs strive to become global or regional leaders, cross-border activity will certainly be brisk. This might also lead to a resurgence of large-scale mergers and acquisitions.
Chapter 1. Global Fintech SaaS Market – Scope & Methodology
1.1. Market Segmentation
1.3. Research Methodology
1.4. Primary Sources
1.5. Secondary Sources
Chapter 2. Global Fintech SaaS Market – Executive Summary
2.1. Market Size & Forecast – (2022 – 2027) ($M/$Bn)
2.2. Key Trends & Insights
2.3. COVID-19 Impact Analysis
2.3.1. Impact during 2022 - 2027
2.3.2. Impact on Supply – Demand
Chapter 3. Global Fintech SaaS Market – Competition Scenario
3.1. Market Share Analysis
3.2. Product Benchmarking
3.3. Competitive Strategy & Development Scenario
3.4. Competitive Pricing Analysis
3.5. Supplier - Distributor Analysis
Chapter 4. Global Fintech SaaS Market Entry Scenario
4.1. Case Studies – Start-up/Thriving Companies
4.2. Regulatory Scenario - By Region
4.3 Customer Analysis
4.4. Porter's Five Force Model
4.4.1. Bargaining Power of Suppliers
4.4.2. Bargaining Powers of Customers
4.4.3. Threat of New Entrants
4.4.4. Rivalry among Existing Players
4.4.5. Threat of Substitutes
Chapter 5. Global Fintech SaaS Market - Landscape
5.1. Value Chain Analysis – Key Stakeholders Impact Analysis
5.2. Market Drivers
5.3. Market Restraints/Challenges
5.4. Market Opportunities
Chapter 6. Global Fintech SaaS Market – By Service Type
6.1. Fund Transfer
6.2. Personal Finance
6.3. Wealth Management
6.5. Personal Loan
6.6. Stock Brokering
Chapter 7. Global Fintech SaaS Market – By Component
7.5. Vision Systems
Chapter 8. Global Fintech SaaS Market- By Technology
8.1. Robotics Process and Automation
8.2. Data Analytics
8.3. Mobile Commerce and Transfers
Chapter 9. Global Fintech SaaS Market- By Region
9.1. North America
9.4. Rest of the World
Chapter 10. Global Fintech SaaS Market – Company Profiles – (Overview, Product Portfolio, Financials, Developments)
10.1. Company 1
10.2. Company 2
10.3. Company 3
10.4. Company 4
10.5 Company 5
10.6. Company 6
10.7. Company 7
10.8. Company 8
10.9. Company 9
10.10. Company 10
Primary & Secondary Sources to Collect & Validate Data
Utilization of Both Top Down & Bottom Up Approach
Holistic Research Methodology
Scope & Introductory Research
In the initial stage of research, the scope for market is defined. In order to better understanding of the market, secondary focus is on different segmentations of the market. Preliminary research involves identifying key data points related to the market under consideration to estimate the market sizes to the best extent.
Based on the scope of the market and the key data points, a number of secondary sources are considered. This data collection stage consists of a team of analysts who gather data from various secondary resources, accessing proprietary databases and primary research by reaching out to key market participants and opinion leaders.
At this stage, collected data using several sources is arranged in structured format. The sources include industry participants, in-house models, key opinion leaders in the market ecosystem and databases. Historical data trends are established at this point, and compared to the current scenario. Based on the macro- and micro-factor prevailing in various geographies, proprietary data models are used to analyze key market countries. Key players in this market are listed based on their capabilities in revenue, sales, and development. The study also involves the identification of companies in the category of 'new entrants' and their potential effects on the market.
At this stage, the analyst team moves on to understand how the market has changed over the years. The total size of the market is gathered after an study of different business segments and end-users is done. An impact research is also done to see what factors will/may influence the market in the years ahead. The effect of various variables on the industry is often taken into account when forecasting market sizes.
Data verification is conducted at all research levels, however this stage is dedicated to more rigorous checking of the data points. At this stage, the estimated data is triangulated with company revenues and checked with industry experts including several senior executives and key opinion leaders in the market. The data is then summarized, and the findings are derived from the same for the report.
Quality Assurance & Report Preparation
Holistic research methodology is followed with combination of Top Down and Bottom Up approach to undertake the estimation and forecasting task in order to ensure quality of data. At this stage of the research process, a dedicated QA team checks the data and approves after several predefined checks. Each section is checked and questioned to make the report accurate and reliable. In case of discrepancy, a team of analysts reviews the issue, and the whole process is repeated again. That significantly improves the report's quality. After approval, all the parts of the report are brought together and is formatted by highly trained team thus making it ready to dispatch.