FinTech Market Breakdown
Sector
Overview
Key Trends
% of 2024 M&A Volume 1 % of 2024 Funding Volume 1
• Leverages cloud-based software solutions specifically designed to address the financial needs of other businesses.
• Focus on AI/ML for scalability, data processing, personalization, and predictive analytics. • Improved user experience through intuitive design, seamless navigation, and personalization. • Interoperability for seamless data exchange and asset transfer across different blockchains. • Modernization of financial systems and economic inclusion by CBDCs. • Decentralized Finance 2.0 (DeFi 2.0) for accessibility, security, and efficiency. • Lower interest rates to drive increased consumer borrowing, benefiting FinTech lenders. • Regulatory scrutiny of digital lending practices due to increasing cyber-attacks. • Leveraging AI for enhanced risk assessment, fraud detection, and personalized pricing. • Analyzing human behavior patterns for accurate risk assessment and personalized products.
Financial Management Solutions
13%
18%
• Uses blockchain technology to generate new financial instruments like cryptocurrencies as well as to facilitate secure and transparent transactions. • Potential applications are cross-border payments, smart contracts, and fractional ownership of assets. • Offers innovative solutions in borrowing and lending money. • Includes digital lending platforms, credit scoring models, loan origination systems, and automated underwriting tools. • Leverages technology to transform the insurance industry by simplifying processes, personalizing policies, and automating claims processing.
Crypto & Blockchain
11%
10%
Credit / Lending Tech
6%
15%
>1%
7%
InsurTech
Source: FE Internal Analysis and Pitchbook as of 31 December 2024. 1. Consists of only lower middle market defined as companies valued between $5 million - $150 million.
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