5 countries with thriving FinTech hubs

Opinion • August 31, 2018

By definition, a FinTech hub is the focal point for FinTech activity within a region or a network – an ecosystem encompassing the entire infrastructure, organisations and people within the hub.

While areas such as Silicon Valley, London, and New York City all stand out as thriving FinTech centers, FinTech startups have popped up all over the world and several countries are coming to the forefront with financial service innovations thanks to funding, new regulations, and booming economies. Here are five regions in the world that are making a name as global FinTech hubs.

1. India

This country has quickly become competitive with the U.S. in number of startups. According to Medici, 1216 new FinTech companies were founded in India between 2010-2015. In 2015, 454 startups were founded in India, while 364 were founded in the U.S. during the same period.

India has a strong payment, lending and investment platform presence. Specific startups include ftcash for small cash-based merchants, ProfitBooks for simplified billing and payments software, FineTrain for small business credit enabling, and Shiksha Financial for lending to low income students.

Bangalore-based Kyash is India’s largest ecommerce focused payment point network and lowest cost payment gateway. The company offers a fully automated and secure system to collect cash and digital payments. Payments can be collected via Pay2vpa, Pay2Account, and KyashCode. These payment networks are country-wide and assist businesses with collecting payments securely and easily from customers.

2. Israel

Israeli FinTech startups have grown to 500 companies with funding at an estimated $500-600 million. Israel is experiencing a strong FinTech ecosystem due to major investments from multiple global players.

Digital payments is the largest market segment in the country. Top Israeli firms that are disrupting the industry include Payoneer for cross-border payments, CreditPlace for peer-to-peer investments, Fundbox for small business cash flow management, and MyCheck for mobile payments for hospitality operators.

Jerusalem-based OurCrowd is an online crowd investing platform that operates globally. OurCrowd’s investment team first assesses thousands of companies before sharing opportunities with their investor community. Individual investors can then choose from a variety of companies to build a diversified startup investment portfolio. The company has over 25,000 investors from over 112 countries.

3. Holland

The Dutch FinTech scene is booming. Amsterdam in particular is enjoying growing FinTech innovation with over 350 companies operating in the area. Payments, trading, and alternative finance are FinTech strengths for the city. The city’s fast internet, quality of life, and open mindedness attracts top talent with over 15,000 employed in Amsterdam’s FinTech sector.

Innovative Dutch FinTech companies include Ayden, a payments platform for business, IMC for trading and a market maker in securities listed on exchanges, GlobalCollect for payment service for eCommerce payments, and Funding Circle for flexible business loans.

One Dutch FinTech company that is making the stock market accessible to the average investor is BUX, an interactive app. Overall winner of the Dutch FinTech Awards, the company teaches people how to trade. Users can start with a free demo account and later upgrade to a real money account. With a simple interface, users can choose between stocks, index, commodities or currency and bet whether the price will rise or fall.

4. Australia

Investment in the Australian FinTech sector has risen from $53 million in 2012 to over $675 million in 2016. The number of FinTech startups in Australia has increased to 579 companies. Sydney has become a major hub in Australia’s FinTech scene, challenging even Singapore.

Payments and lending are strong FinTech areas in the region. Leading Australian innovators include zipMoney for loans for large purchases, CoinJar for managing digital currencies, Airwallex for international payments, and Nimble for flexible lending.

Prospa has become a leading company in Australia for online small business lending. The company loans businesses up to $250,000 with 3-24 month terms and cash flow friendly repayments. Small businesses can apply in 10 minutes, receive same-day approval and funding possibly in 24 hours.

5. Singapore

Last but certainly not least, Singapore has become a powerhouse in terms of startups and funding. With 490 FinTech companies, the region hit a funding high at $229.10 million in 2017. According to the the 2017 Institute for Financial Services Zug global Fintech rankings, Singapore takes the leading role as the most attractive center for locating FinTech business. The region hosts the world’s largest platform for the global FinTech community (the Singapore FinTech Festival) and is competitive in areas such as blockchain, AI, and machine learning.

Well-funding FinTech companies in Singapore are Quoine for cryptocurrency trading, KyberNetwork for the exchange and conversion of digital assets, Funding Societies for peer-to-peer lending, and Tryb Group for bringing global capital markets closer to underserved ASEAN consumers.

One unique startup is Singapore-based Alpha Fintech which serves as a vendor management platform to provide access to FinTech innovations. The company provides a single interface to manage payments, risk, commerce and blockchain vendors. The platform is standardised in terms of vendor response codes, data streams, and billing.

FinTech startups are gaining traction around the globe. In addition to the countries listed, other regions that are growing as hubs include Hong Kong, Melbourne, Chicago, Charlotte in North Carolina, etc. As other areas strive to become more FinTech friendly, startups will likely emerge with financial innovations, continuing to disrupt and change the global professional landscape.