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FinTechs in Europe

Portrait of Wolfgang Hach
Senior Partner
Munich Office, Central Europe
+49 89 9230-8724
November 16, 2016

The dynamic FinTech scene heralds big changes for the financial services market. Trends like digital customers, as well as the emergence of new technologies and regulations, are creating ideal conditions for FinTech companies. Even established organizations stand a good chance against the competition. The new study “FinTechs in Europe – Challenger and Partner to Banks”, surveyed 248 FinTechs from 18 European countries. It reveals insights into the current FinTech climate.

The majority of FinTechs are young, confident, and focused on specific slices of the value chain. They offer innovative solutions, but not all of their offerings are disruptive. Their market success must first show itself. New competitors profit in part from lower regulatory burdens, but even this is likely to change and lead to a market adjustment.

Around 19 billion dollars was invested in FinTechs in 2015 worldwide, an increase of almost 60 percent in comparison with the previous year. Investments, asset management, payment transactions and crowdfunding were identified by study participants as the biggest growth areas to watch. Crowdfunding and crypto/blockchain solution providers are highly optimistic. Founders are seeing the best conditions for their businesses in Great Britain, Ireland and France.

In the mid-term, the entire market will face outside pressure from technology giants, who attract the most new business. FinTechs are already looking to work together with banks and insurers. Both sides have the opportunity to profit. 86 percent of new companies avoid confrontation, choosing instead to cooperate with branch leaders. Furthermore, two thirds do not believe that they can take the place of classic financial institutions. Established players need to be open to new solutions and be prepared to learn from the methods of FinTechs.

Study

FinTechs in Europe

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Challenger and Partner to Banks

Published November 2016. Available in
Portrait of Sebastian Steger
Partner
Berlin Office, Central Europe
+49 30 39927-3488