Fintech to reach $1.5tn by 2030

A report by Boston Consulting Group (BCG) and QED Investors has projected that the revenue generated by fintech firms will rise by 600% to reach $1.5tn by 2030, up from $245bn at present. Despite accounting for only 2% of the $12.5tn global financial services industry, fintechs are predicted to have a 7% share of the market within the next seven years. The report predicts that neobanks like Nubank, Revolut, and Monzo will make up almost 25% of all global banking valuations by 2030.

The report highlights that in 2022, fintechs on average lost over half their market value as interest rate fluctuations dented investor confidence. Despite this setback, the report states that fintech is still in its early stages, with the potential to revolutionise the financial services industry, as it continues to unlock new use cases through technology. Furthermore, the report emphasises that customer experience remains suboptimal and over half of the world’s population remains either unbanked or underbanked.

BCG Managing Director and Senior Partner, Deepak Goyal, commented that the opportunity for fintech to democratise financial services on a global scale is tremendous. Meanwhile, Nigel Morris, QED Investors Managing Partner, and co-author of the report, added that fintech sits within a large, profitable industry, and the report highlights the significant opportunity for firms to address the substantial unbanked population and their needs.

The report is optimistic about the future of fintech, especially given the potential for new technology to unlock new use cases and address unbanked populations. The findings of the report provide hope to fintech firms that are recovering from the effects of the pandemic, as the industry continues to expand and gain prominence on a global scale.