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Report - February 6, 2020

Observations on Key Fintech Trends

  • The financial technology market continues to attract strong interest from financial investors and strategic acquirers alike, with more than 550 M&A transactions completed in 2019 globally

  • Consolidation persists as the sector matures and is expected to continue as fintech market leaders reach scale and look to pursue inorganic add-on opportunities to acquire customer relationships and grow payment volumes

  • Online banking and payments companies continue to experience rapid growth lead by Zelle, which now facilitates P2P payments for 21 of the 27 largest banks in the U.S., and Chime, which grew from 4 million accounts in June to 6.5 million accounts by year-end

  • Technology companies are increasingly seeking to integrate billing and payments directly into their solutions to both improve end-user experience and to capture incremental economics from payment processing, creating a significant opportunity for companies offering to outsource specialized fintech infrastructure for their customers

  • Corporations globally are eager to optimize B2B transactions and automate traditional finance functions by leveraging the ever-expanding trove of data collected and generated by improving ERP systems and are investing in cloud-based software solutions that improve procurement, AP automation, supply chain finance, and settlement activities, as well as working capital exchanges that enhance profitability

  • The banking and insurance industries continue to evolve as financial institutions increasingly adopt modern SaaS solutions to defend against competitive unbundled offerings, improve operational workflows, accelerate customer acquisition, and enhance client experience across business lines

  • Adoption of online and mobile financial services solutions has accelerated globally as the proliferation of smartphones, digital currency, and digital native banks make online transactions increasingly frictionless, secure, and convenient for consumers and a necessity for merchants seeking to improve their customer experience

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