BCG’s Global Fintech Report says 2024 marked a turning point. Funding and valuations stabilized, and fundamentals improved sharply. Fintech revenues grew 21% year-over-year, up from 13% in 2023, and outpaced the 6% growth in the broader financial services sector. EBITDA margins for public fintechs increased by 25%, and 69% of them achieved profitability—up from less than half the year before. The first chapter of fintech produced scaled winners in digital wallets, acquiring, vertical SaaS, challenger banking, crypto trading, and BNPL. While a few players may still scale in these areas, these winners will be increasingly hard to displace. Future growth is likely to come from fintechs in three emerging segments:
B2B(2X). Businesses still face many pain points in payments, accounting, and treasury management—areas where AI can automate. Fintechs also still have much room for growth in embedding their solutions in SaaS platforms.
Financial Infrastructure. Though slower to scale due to longer sales and implementation cycles, the world’s financial infrastructure requires modernization to take advantage of technologies like AI and onchain finance.
Lending. Lending remains underpenetrated and ripe for innovation beyond unsecured consumer credit, especially in business and secured lending. As noted, new tailwinds are emerging that will support growth in this area.