Chinese and U.S. flags fly outside a hotel during an event on the 2012 U.S. presidential election results organized by the U.S. Embassy in Beijing November 7, 2012.
Ed Jones | AFP | Getty Images
From the United States to China, countries around the world are vying for leadership in financial technology, a highly lucrative industry that has grown over the years to include everything from retail banking to online wealth management.
Since the 2008 financial crisis, thousands of new companies have been created with the aim of taking on incumbent financial institutions and offering more accessible services to both consumers and businesses.
In the UK, startups like Monzo and Starling took the banking world by storm with their digital-only offerings, while in China Ali Baba And Tencent have launched their respective mobile wallets Alipay and WeChat Pay.
In August, CNBC published a list of the world’s top fintechs in collaboration with Statista. To select the world’s leading companies, Statista used a rigorous methodology that assessed several key business metrics and fundamentals, including revenue and number of employees.
Statista identified 200 of the top companies worldwide in nine categories, including neobanking, digital payments, digital assets, digital financial planning, digital wealth management, alternative financing, alternative lending, digital banking solutions and digital business solutions.
Using additional data provided by Statista, CNBC analyzed the overall leading nations in financial technology and divided the analysis into three main areas of focus:
- The countries with the most valuable fintech industries based on market capitalization.
- Total number of top fintech companies as determined by Statista.
- The number of “unicorn” companies with a valuation of $1 billion or more in different countries.
So which countries are at the forefront when it comes to fintech? In three graphs we found the following.
The USA and China are home to the most valuable fintechs
According to Statista data, the US is home to the world’s most valuable financial technology companies in 2023 – but China isn’t far behind, with mega payments companies like Tencent and Ant Group giving the country a solid second place.
Ratings data is as of April 2023, excluding Ant Group, Stripe, Nubank, Checkout.com, Revolut, Chime, Polygon, Rapyd, Ripple, Blockchain and Plaid.
Collectively, the US generates the most value in fintech: eight of the 15 highest valued financial technology companies in the world are based in the US, with a combined value of $1.2 trillion.
Visa and Mastercard are the two largest fintech companies by market value, with a combined market capitalization of $800.7 billion.
China is home to the second-highest valued fintech industry, with financial technology giants having a total market capitalization of $338.92 billion.
The UK has the second largest number of top fintech companies
According to CNBC’s list of the world’s top 200 fintech companies, 65 of the top fintech companies were based in the United States. The United Kingdom came in a close second with 15 of the world’s top 200 fintech companies, while the European Union is home to 55 top fintech companies.
The USA has a dynamic fintech market, not least thanks to its wealthy investors.
Silicon Valley is a natural home for the industry, as it has spawned some of the world’s largest technology companies such as Apple, Meta, Google and Amazon, and has a well-established venture capital ecosystem with major players such as Sequoia Capital and Andreessen Horowitz in attendance.
In the US, the world’s leading fintech companies on Statista’s list include names such as Stripe, PayPal And Intuitive. These are all companies with significant market shares and branded products used by thousands, if not millions, of companies large and small.
The UK also has a significant fintech industry.
Backed by many forces – from innovation-driven stalwarts like the Financial Conduct Authority to growing pools of capital including venture and private equity, to a government that has sought to put fintech at the top of its agenda – the UK has managed to making a difference to major companies in the fintech world, from digital banking giant Monzo to listed payments company Way.
In China, another prominent fintech player identified by Statista, the market for digital financial services is huge.
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Tencent’s WeChat Pay and Ant Group’s Alipay have cornered the mobile payments market, providing plenty of competition for the fragmented, less developed banking sector. Consumers in China tend to have a closer relationship with digital platforms such as WeChat than with established lenders.
But the fintech industry faces a number of challenges – not least macroeconomic headwinds.
One of the biggest obstacles currently facing the sector is dwindling liquidity in venture capital.
In Europe, a combination of the Russian invasion of Ukraine, the fallout from Covid-19 lockdowns and the resulting interest rate hikes impacted most major economies.
Meanwhile, in the U.K., the tech industry’s woes generally have been exacerbated by Brexit, which critics say restricts foreign investment.
“The venture environment in general is struggling,” Nick Parmenter, CEO of management consultancy Class35, told CNBC. “IPOs are less common and have lower valuations, it is difficult to raise funds from LPs, and valuations are declining throughout the risk cycle.”
“This makes it significantly more difficult to raise growth capital, leading management teams to be more conservative in their cash use. This results in a trickle-down effect in the fintech market – consumers have less discretionary income to invest or spend, limiting revenue potential for consumer-focused fintechs and small businesses alike.”
The USA is at the top of the fintech unicorns, with the UK in second place
The UK is once again flexing its fintech muscles when it comes to the number of highly valued “unicorn” companies in the country – the UK is only second to the US, home to the largest number of fintech unicorns in the world. Unicorns are venture capital-backed companies with a valuation of $1 billion or more.
The largest unicorns in the UK include online banking startup Revolut ($33 billion), crypto wallet provider Blockchain.com ($14 billion), and digital payments group Checkout.com ($11 billion). -dollars), Rapyd ($8.75 billion) and SumUp ($8.5 billion). Billion).
Meanwhile, in the US, the largest fintech unicorns are Stripe ($95 billion), Chime ($25 billion), Ripple ($15 billion), Plaid ($13.5 billion), Devoted Health ($12.6 billion) and Brex ($12.3 billion).
Other leading fintech unicorn ecosystems include India with 17 unicorns and China with eight. France, Brazil and Germany each have six fintech unicorns.
In 8th place are Mexico with five fintech unicorns, Singapore with also five and the Netherlands with a total of four.
REGARD: In a new report from Statista and CNBC, the US ranks first among the world’s leading fintechs
