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I have to admit that many countries are looking to become Fintech innovators because the investments in the industry are impressive and everyone wants to get their ‘piece of the pie’. However, the leadership still belongs to those who spotted the Klondike first: the United States, Britain, Singapore, Lithuania, and Switzerland. And all of them are leaders in the payments, DeFi, and cryptocurrency industries.
But how do you measure progress?
Fintech is multi-faceted and its application is most vividly demonstrated in the crypto industry, the profile industry startup climate, the volume of online payments, and the depth of blockchain usage. in the country.
Payment solutions and their level of penetration are an excellent benchmark for analysis. This area was the first small bridge between inline plastic and the old school. Global analytics giants ACI Worldwide and GlobalData released the 2020 report that “Asian Tigers†– India (25,478 million transactions), China (15,741 million), South Korea ( 6,015 million) and Thailand (5,241 million) – were named. the top 4 countries in terms of real-time transactions. Mexico comes fifth with 942,000 transactions.
The surge in online transactions caused by the pandemic has further contributed to the capitalization of projects focused on online payments. For example, Stripe, in the US, and Plaid, in the UK, nearly tripled their ratings during the year. In total, ten payment companies reached the Forbes top 50 this year; Above all, they are all from the United States, which is testament to the high level of fintech penetration in the country. As for the B2C segment, the number of users of mobile payment applications increased in 2020 by 29%, reaching 92.3 million. By the end of 2021, the user base is expected to grow 9.7% to exceed 101.2 million. The ASEAN mobile contactless payments market is dominated by China, where the volume of smartphone-assisted payments is expected to reach $ 1.3 trillion in 2021. Europe’s top gun is Britain whose payments contactless will amount to 98.5 billion dollars this year, a massive growth of 195% in two years. This figure is expected to increase by an additional 60% in 2021-2023, to reach $ 157.8 billion.
From the USA to Africa and Asia
The geographic image of the most advanced crypto countries is changing dramatically: the top five include Nigeria (32%), Vietnam (21%), the Philippines (20%), Turkey (16%) and the Peru (also 16%). Japan with its 4% ranks tenth. Africa’s largest economy is the king of cryptocurrency. Thirty-two percent of those polled in Nigeria said they owned and used some type of cryptocurrency in 2020. For comparison: Only 6% of US residents have. A global consumer survey by Statista reveals an obvious trend: People from African, Asian and South American countries own or use cryptocurrency much more often than citizens of Europe, North America or South America. ‘Australia. But when it comes to Bitcoin, the United States is the absolute world champion. States with a more developed economy and stable fiat currencies find themselves in the lower ranks: in poor countries like Nigeria and Southeast Asia, crypto transfers are much cheaper, and cryptocurrency is also a means to cover inflation thanks to the limited number of coins.
From the point of view of legislative regulation, there are several country camps. The most advanced among them recognize crypto as an autonomous currency: Germany, Luxembourg (the government is actively involved in the development of blockchain), Sweden and Japan. And there are countries that have given it the status of electronic money: Argentina, Bulgaria, Hong Kong, Iceland (excluding cross-border transfers), Canada (regulates crypto under AML and CTF laws), New Zealand, USA, Finland, France and Croatia. Russia started to regulate crypto assets by law in 2021, and the Verkhovna Rada of Ukraine is currently considering the bill from the Ministry of Digital Transformation for second reading, so there is a good chance that it will be enacted. before the end of this year.
As I mentioned above, blockchain is also having a significant impact on the advancement of fintech. In the post-pandemic period, it is still accelerating with regard to the monitoring of vaccination and immunity passports, as well as the storage of valuable assets and so-called NFT projects. The implementation garland has traditionally been held by U.S. transnational corporations such as Amazon and IBM, large retailers like Lidl, and Asian countries that are actively anchoring chains in the public sector. As for NFT and valuable assets, the strongest growth is observed in Europe, namely Germany, the Netherlands and Great Britain.
What about sandboxes?
We cannot underestimate a country’s start-up climate. Apart from traditional industries such as electrical engineering or metallurgy, this is a lightning-quick method for increasing economic investments. In my opinion, Lithuania is the real superstar in this area. The country has made immense efforts to create a favorable environment for fintechs and start-ups by improving its legal and business frameworks, creating regulatory sandboxes and implementing banking reform. As a result, it ranks 11th in the world ranking for ease of doing business. With a smaller population than in Kiev, Lithuania prides itself on the status of a leading financial technology hub in Europe.
Other top performing European countries include the UK, namely London, which is a leader among European cities in terms of the volume of venture capital investments in fintech start-ups. Next come Berlin – 21%, Paris – 18%, Stockholm – 5% and Barcelona and Amsterdam with 4%. The conclusion is therefore obvious: economically developed countries are keen to create comfortable conditions to attract FinTech projects.
Asia is not lagging behind: the number of Fintech companies registered in Singapore exceeds 1,000, an increase of 70% over last year. Importantly, almost all of them were founded by non-residents. From April to June 2021, the world saw the emergence of 136 Fintech unicorns, most of them from the United States. The United States has always been and remains attractive to those who are willing to take risks and obviously want to reach for the stars.
Ukraine also has something to boast about: the country today has around 500 financial start-ups, largely thanks to the more energetic efforts of the government and the National Bank, and also a fairly liberal public policy. Our first mobile bank founded in 2017, Monobank, was recognized as the world’s fastest growing bank and caught the attention of a major Silicon Valley investment fund. And today Vlasnyi Rakhunok is a neo-lucky, the 7th largest smartphone bank in Ukraine.
Secondly, our capital has become the fifth city in the world to allow payment of metro tickets with a card at the turnstiles. Over 100 million card and NFC payments have been processed within 5 years of implementing the technology. We got ahead of Poland, Canada and a number of European countries where the service was introduced earlier.
This is proof of a rapid positive dynamic regarding the attitude of Ukrainians towards innovative solutions. It is nice to see the government take an interest in the growth of the industry, because it is when success can guide the development trajectory of the whole country. It would be hard to imagine the financial services industry today without technological solutions, and Ukraine has a good chance of being among the top 5 leaders in the European region.
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