Global Fintech revenue is expected to increase around 6x from current levels between 2021 and 2030 and could hit $1.5 trillion.
The APAC region is expected to claim a significant portion of that total, representing around 40% of international Fintech revenue or totaling about $600 billion annually, according to a report published by the Boston Consulting Group (BCG) and QED Investors.
These figures indicate that the Asia-Pacific region could surpass the US markets by that time, which remains the world’s largest Financial tech ecosystem, due to its robust growth in fintech revenue which the study claims will represent approximately 27% per year for APAC against only 17% for the United States.
The report, entitled “Global Fintech 2023: Reimagining the Future of Finance and released in May 2023,” examines the present state of the international Financial Technology industry, looking into the current trends, obstacles, as well as opportunities in the fast-evolving markets.
It confirms the steady growth the region is expected to experience, due to the rise of APAC’s Fintech space and the area’s relatively large population of unbanked consumers.
The steady growth of Fintech products and services in the APAC region will be led mainly by the emerging markets sector, the research report claims.
Nations such as China, India and Indonesia are presently home to some of the biggest Fintech firms, large numbers of underbanked people, a relatively high number of SMEs along with a rapidly growing tech-savvy workforce, the report reveals.
As covered, US Fintech funding increased by 42% during the first half of 2023 when compared to the last half of 2022, according to a report. Fintech funding hit $12.8 billion from January to February 2023 but still down by 33% when compared to the same period in 2022, says Tracxn.
Of note is that the report states that the US market was home to 58% of Fintech funding globally in H1 2023.
San Francisco, New York and Los Angeles are the main centers of activity. Fintech startups in San Francisco attracted investments worth $8.1 billion, followed by New York at $1.4 billion and Los Angeles at $296 million. Payments, Crypto, and investment tech were the hot sectors.
As reported earlier this year, global fintech venture capital firm QED Investors announced that it has closed two new funds with combined capital commitments of $925 million.
The new capital commitments comprise Fund VIII, “an oversubscribed $650 million early stage fund, and Growth II, a $275 million early growth-stage fund.”
These funds will allow QED to further invest in disruptive fintech companies in the U.S., the U.K. and Europe, Latin America, India and Southeast Asia and other world regions.
QED Investors Managing Partner and Co-Founder Nigel Morris said:
“We are excited, fortunate and privileged to be a steward of our investors’ capital. We don’t take that responsibility lightly, especially in this difficult market. QED has been working intentionally to achieve what we believe is threshold scale in terms of capital, team, skills and brand globally. We are proud to have a world-class team that combines proven operational DNA, experience through multiple economic cycles and the right decision-making frameworks for the current environment. Growth at all costs will not win the day in this business cycle. Unit economics, product-market fit and clear paths to profitability are the keys to survival, and QED is uniquely positioned to support our companies with the best advice in fintech.”
