Over the past 10–15 years, fintech has grown from a niche industry to a powerful transformative driver in the global economy. Financial technologies have penetrated into many areas of human activity, and now they are all around us. Previously, small startups worked in the fintech industry, but today, large and recognized players whose valuations are tens of billions of dollars operate there.

Here are some numbers. According to the Boston Consulting Group, the global fintech market remains a hotbed of innovation and growth, even despite the fact that over the past few years, there has been a decrease in financing volumes and a drop in company valuations because of high interest rates and the venture winter. Billions of people around the world still do not have access to modern financial services, and technological progress makes it possible not only to automate new types of businesses but also to reach out to new groups of underserved customers, so the fintech industry still has enormous potential. By 2030, the size of the fintech market may reach $1.5 trillion, which is about five times more than in 2024.

According to Statista, in 2024, the global fintech market was dominated by North America, where more than 12,000 companies were concentrated. Europe retains its position as the second-largest fintech center with over 9,200 companies, while more than 6,300 companies have been identified in the Asia-Pacific region. According to various sources, there may be up to 40,000 companies operating in the sector worldwide.

The fintech industry is booming, and many companies are planning to launch an IPO in the near future. During the winter venture, the economy has accumulated a lot of strong candidates. The trend towards lower interest rates and an increase in the money supply from the world's leading central banks is now heating up the entire financial technology industry. Among the strong candidates for going public are such names as Chime, Stripe, Circle, Kraken, Gemini, and among the European names are Klarna, Monzo, Revolut, Starling Bank, Zilch, and Ebury. There are many specialized ETF funds investing in fintech companies. ARK Fintech Innovation, Global X Fintech, and Fidelity Select Fintech are among the funds worth mentioning.

As already said, there are tens of thousands of fintechs in the world. It is already a whole universe. Competition in the industry is increasing. What are the most interesting internal segments right now? To date, several areas have demonstrated steady growth and promising results. This is due to technological progress, changing consumer behavior, changes in legislation, and the growing demand for digital services. I would like to identify four segments where, in our opinion, it is worth looking for new unicorns.

These are technologies that allow seamless integration of classic financial services (such as payments, loans, insurance) with non-financial platforms (for example, e-commerce, SaaS, trading platforms). Technologies in this segment allow companies to retain customers and open up new sales growth opportunities, for example, through embedded lending. The main investment idea here is the integration of new financial solutions in spheres where finances are still manually managed.

Technologies in this segment include AI-driven solutions for assessing creditworthiness, detecting fraud, generating personalized financial advice, and automating customer service. This technology stack speeds up analytics and the decision-making process, reduces operational costs, and improves the quality of client service. These technologies are most in demand among banks and insurance companies, as well as neobanks. The main investment idea here is the automation of complex financial services that previously required qualified personnel, so as to perform such services in a "peopleless" mode.

This segment includes technologies that allow people to manage personal investments, plan personal finances, and create their own well-being. The prospects of these technologies are due to the widespread democratization of investing, the growing middle class in Asia, Africa, and Latin America, as well as the saturation of asset management with new various tools and technologies. The main investment idea here is the opportunity to offer millions of people a wide range of investment services previously available only to wealthy individuals.

This segment includes security technologies. The prospects of this area are conditioned by the growth of cybercrime. As the number of digital services and transactions grows, so does the need for advanced fraud detection and cybersecurity solutions. Specialized technologies help financial institutions identify and mitigate risks in real time. The investment idea here will be the creation of new, effective, and complex counter-criminal solutions.

The fintech industry will continue to develop rapidly in the coming years. This trend will be facilitated by technological progress, new masses of customers, and possibly new waves of liquidity. Against the background of growing competition, the most promising technologies will be those that can solve long-standing and complex problems with traditional finance, as well as improve user experience and meet new regulatory and sustainability requirements. To succeed in the above four segments, startups and investors should focus on accuracy, scalability, speed, and user-friendly design.

Anton Alikov
CEO and Founder, Arctic Ventures
https://arcticventures.vc