APAC The New Center of Gravity for Fintech
India, APAC and Asia's astounding fintech growth!
This BCG fintech report is something you don’t see every day as it is written from a distinctively Indian and APAC perspective, setting it apart from all others. Even global trends have a refreshing APAC perspective!
Fintech in India, which is on a journey to become a “Fintech Nation,” is booming and boasts the #3 spot in terms of fintech unicorns.
But unicorns aren’t the most important measure. What makes fintech in India and APAC special is the profound change it is making to people’s lives throughout the region.
Digital payments are a primary force behind APAC's astounding fintech growth, and the report boldly claims that APAC will be the global leader in fintech by 2030.
👉TAKEAWAYS
Global fintech trends, the dark days are behind us, and APAC is on fire:
🔹 Global Fintech revenues on track to reach $1.5Tn by 2030
🔹 🔥APAC set to become the epicenter of Fintech innovation with $600Bn revenue, along with NAMR at $520Bn revenue by 2030, generating 3X revenue of next best region 🔥
🔹 Global Fintech funding has stabilized in the range of $7-10Bn in the last 4 quarters (down from an exuberant $20-30Bn quarterly Fintech funding in 2021-22)
🔹 Mix of funding across sectors has remained stable over the years:
➢ Financial infrastructure’s share of investments has seen a resurgence in 2024 ➢Insurtech continues to lose share of investments due to limited use cases demonstrating path to profitability
🔹 Regional capital allocation trends reveal convergence of segmental capital allocation between developed and emerging markets:
➢🔥Developed world increasing share of investments in payments to catch up with emerging markets 🔥
➢All markets increasing share of investments in WealthTech, indicating a surge in mass-affluent population across geographies
🔹 Significant shift in investment mix towards B2B and B2B2X focused Fintechs. With their share in funding increasing to 65%, it reflects a growing preference for business models with steadier income streams and clearer paths to profitability.
🔹 M&A activity in the Fintech sector has surged 1.8 times over the past four years, indicating expectations of path to profitability due to economies of scale.
North America (NAMR) is now spending heavily on digital payments to catch up to emerging markets. I have been writing that Asia has leapfrogged the West for the past five years.
👊STRAIGHT TALK👊
I loved this report because while it covers both Indian and Global fintech trends it does so from a uniquely Indian perspective with an eye toward APAC.
This may not seem like much to Western readers, but if you read carefully, you can see the pride in India’s fintech renaissance.
There is no doubt that North America’s fintech revenue, currently at $184bn, is nearly triple APAC’s at $66bn. This will lead some to dismiss these projections as wishful thinking.
That would be a mistake. Never forget that the IMF projects that 60% of the world’s GDP growth is in Asia this year, with India outperforming all other major economies!
Another factor to consider is that India’s fintech transformation is still new, with much room for growth.
The sub-title of my newsletter is “Fintech at the Speed of Asia.”
This report shows you why!
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