The news: Global fintech revenues increased by 21% YoY in 2024, a strong increase from 13% in the previous year, per Boston Consulting Group and QED Investor’s Global Fintech Report.

Fintech growth snapshot: Over the last year, fintechs have still managed to gain ground. 

• Challenger banks such as Monzo, Nubank, and Resolut fueled impressive 23% revenue growth in the deposit vertical. 
• Trading and investment fintech revenues grew 21%, driven by crypto exchange Coinbase.
• Insurance fintechs measured 40% growth, while only comprising less than 1% of global revenues.

Size of the prize: Out of the approximately 37,000 fintech globally, scaled fintechs—those earning more than $500 million in revenues—account for 60% of total global fintech revenues. This means fewer than 100 companies reap the lion’s share of revenue generation. 

Fintechs currently account for only 3% of global banking and insurance revenues—leaving many verticals and geographies open for future penetration. 

How they’re doing it: Many owe their current success to addressing unmet needs of merchants in spaces where banks have been historically uncompetitive, like software as a service in restaurants or retail. 

Other fintechs have targeted lower-income customers that banks’ have failed to serve due to lower unit economics and regulatory barriers. (Conversely, fintechs struggle to reach higher-income customers due to banks’ ability to serve this cohort more effectively.)

Fintechs have also thrived in areas where banks have been hesitant to invest due to regulatory issues or strategic limitations, such as crypto and digital wallets.

Our take: Fintechs have ample opportunities to expand their success using the nimbleness that incumbents lack. 

Fintechs can expand their share of banking and insurance revenues by focusing on their fundamentals; drilling down into their home markets’ untapped potential among digital natives, the unbanked, and the underbanked; and investing in AI. Scaled fintechs can also focus on merger and acquisition (M&A) opportunities.

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