Our Outlook on the Fintech Industry

The fintech industry is one of the most significant sectors of technology. No matter who a person is or what socioeconomic demographic they fall into, at some point in their life they have or will use some tool or service related to fintech. The fintech category includes a plethora of areas such as banking, lending, insurance, credit, investing, payments, currency, and now digital assets.

The introduction of technology has transformed these sectors and sparked incredible growth. According to Adroit Market Research, global fintech market revenue is expected to grow at a rate of 20.3% per year from $160B in 2022 to $698 billion in 2030 (1). North America currently accounts for the largest share of the revenue in Adroit’s report, but other reports suggest that China is currently the biggest fintech market in the world. This is largely due to the widespread use of digital payments, with transaction values reaching $2,496 billion in 2020 (2). The fintech industry is expected to experience significant growth in the coming years, led by the world’s two largest economies. However, the adoption of fintech in other markets presents an even greater potential for growth.

The rampant adoption of the smartphone has been a huge proponent of growth for the fintech industry. When the smartphone was introduced in 2007, which was just at the start of the Global Financial Crisis, the financial services industry (especially banking) rapidly underwent a radical transformation. Banks and other financial services providers had to adapt and implement technologies to stay relevant to consumers who expected digital services on their phones. Customers also expected increased transparency, better access and customer service, and fewer costs. All these things were made easier and more convenient with the adoption of financial technology. As a result, the fintech industry expanded and it continues to grow rapidly today. The pandemic was also a major catalyst to the boom the industry is experiencing as it has forced more people to utilize digital financial services even more than they previously had.

Early on in my career I worked in financial services on the retail investment side as an advisor. Towards the latter half of my time in the industry many of the risk management and investment products I helped my clients with could be easily accessed online without my intervention and often for less money. As an example, I once earned a good-sized commission after placing a trade for a client. I later asked myself why would (or should) this client continue to pay this commission when they could easily do this online for free? This is an isolated example, but it illustrates the sentiment that a lot of consumers and businesses were ask themselves when engaging with the financial services industry.

The application of technology to financial services will continue to evolve especially with the introduction of artificial intelligence, machine learning, and blockchain/ledger technology. We consider the fintech industry to be somewhat mature at this point, and as a result some might expect its rate of growth to slow down. It’s certainly possible that happens in developed economies, but most people forget that 1.4 billion people in the world are underbanked (3). As stated earlier, the pandemic was a catalyst for increased financial inclusion, access, and transmission of financial resources to those with the greatest financial need. According to the World Bank, “the biggest growth has been in the use of digital payments, which surged during the pandemic as mobility restrictions and when cash was perceived as unsanitary. In developing countries, roughly 40% of people made a digital payment for the first time during the pandemic (3).

At Serac Ventures, we expect the fintech industry to continue to grow. This will have a positive multiplier effect on payments, financial planning and management tools, access to credit and banking, and the digitization of physical currencies. Although there have been looming fears of a recession, such as the recent bankruptcy of SVB, companies that think globally and use technology to make financial tools and services easier, more efficient, and economical are poised for long-term growth.


(1) Adroit Market Research

(2) Statista Fintech Industry

(3) World Bank

Picture taken by Jonas Leupe (www.brandstof.cc)

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