KPMG: top 10 fintech trends in Asia
Business Chief APAC takes a look at KPMGs key insights from its research into the fintech market in Asia
As the fintech market continues to experience growth in the level of venture capital funding, KPMG reports that the industry is scaling up and diversifying, with its focus moving towards Asia.
In the company’s report Fintech100 — developed in collaboration with H2 Ventures — the research ranks the top 50 established fintechs and the top 50 emerging fintechs globally. Overall KPMG and H2 Ventures report that 42 of the top 100 are from Asia-Pacific, compared to 26 from EMEA and 22 from America.
This week’s Top 10 takes a look at the report’s key insights from its research into the fintech market.
1. Capital fuels innovation
Ranking number one in the report, the organisations identify that capital continues to drive innovation. Last year, Fintech100 raised over US$18bn in venture capital, with a total of US$71bn during its lifetime.
2. Leading player
At number two, Fintech100 highlights that leading players in fintech are attracting the largest share when it comes to venture capital. The research reported that the average raised by the top 10 Fintechs totalled more than US$1.2bn.
3. Innovators
When it comes to innovation, Fintech100 reports that companies are scaling up. Those on the 100 list currently serve 2.5bn customers globally, which drives opportunities for scale and innovation.
4. China and India
While the report shows that China continues to lead the Fintech100, it also highlights that India is coming up through the ranks. KPMG and H2 Ventures believe that this is only the beginning for India, and has huge potential when it comes to fintech.
5. Rapid growth
When it comes to driving innovation, it is not only startups but traditional banks too that are innovating in the fintech market. The report highlights that while the concept of fintech is normalising, the scalability posed by large companies innovating in this space is driving rapid growth.
6. Blurred industry boundaries
With companies from other industries seeing the potential fintech innovations can provide, KPMG and H2 Ventures predict that more and more non-financial services players will enter into the industry. This is reported to be a result of virtual bank licences and open banking solutions.
7. Globalisations
As fintech organisations continue to evolve, it is expected that they will use the scale established in their home regions to drive globalisation in the future.
8. Mainstream
When the concept of fintechs emerged, early innovators had monoline propositions. The Fintech100 report highlights that banking licences are helping fintechs to diversify, with regulations facilitating increased competition and customer choice.
9. Open banking
Putting customers in control of their data, open data is providing fintechs with the capability to drive personalisation and customer focused services in their operations. As a result KPMG and H2 Venture expects open data to increase competition and drive innovation.
10. Southeast Asia
In addition to China and India, the report also highlights Southeast Asia as a hotspot for fintechs. Out of the 100, there were more organisations based in Asia Pacific (APAC) compared to any other region. In addition, out of the 11 organisations that raised over US$1bn in the last three years, eight were from the APAC region.
For more information on business topics in Asia Pacific, Australia and New Zealand, please take a look at the latest edition of Business Chief APAC.
