As the fintech sector has matured in recent years, it has given rise to some serious challenger digital banks and remittance services, spawning a new generation of unicorns taking on the financial system.
We were honoured to be joined at 4YFN Barcelona this year by Maximilian Tayenthal, the Founder & CFO of European online bank N26 that recently attained unicorn status. TransferWise too is now one of the five most valuable unicorns in Europe following its recent Series E valuation of $3.5 billion.
But the biggest action on the fintech scene is in China, where we will be hosting 4YFN Shanghai next month. Shanghai is an established global financial hub and China is by FAR the biggest market for mobile transactions in the world ($12.8 trillion in the first 10 months of 2018 compared to $49.2 billion in the US over the same period).
Alipay and WeChat have already transformed daily life in China, where there are low barriers for fintech products. Chinese consumers openly share personal data making adoption more seamless there than elsewhere. Tech giants are aggressively embedding fintech into their products and mainstream banking institutions are looking to the tech sector to help them innovate. Many banks in Asia are taking their platforms from technology companies wholesale rather than building their own.
As the TransferWise model has shown, there are big opportunities for startups in the area of remittances and China remains a major destination for international remittances. Only India receives more remittances than China and the two markets far outstrip any other economy in terms of capital inflow, according to a recent report by the World Bank.
There are huge opportunities in China and around the world as banks retreat from the important paired relationships with each other to cover currency exchanges. Increasing oversight and regulation means that banks are reducing the number of these reciprocal arrangements, driving up costs to exchange currency and increasing the opaque costs of cross-border banking. Regulators are mulling plans to enforce transparency and those already trading on transparency, like TransferWise, are reaping the benefits.
The opportunities for user acquisition in China are also first rate. There is still a large population of unbanked or underbanked Chinese plus a growing middle class for whom more mature products are inappropriate. Fintech products have proven to be powerful tools for financial inclusion and development and they have been instrumental in spreading wealth and ensuring that communities marginalised by the global financial system are brought into the mainstream economy.
That is why we will be talking all things fintech in Shanghai next month, including on our Fintech Investment in China panel at 12:10 on 27 June. Not only is Shanghai home to a third of the leading Top 50 fintech startups in China, but the sector is the largest in terms of overall investment.  As an established global financial hub, the most populous city in the world is home to sizable amounts of ready capital. Investors representing more than €27 billion of available funds for startup investments are expected to attend 4YFN in Shanghai – all in the market for startup opportunities! It’s the perfect chance to make that meaningful connection that change your fate and accelerate your success.
Find out how you can join us as a guest, exhibitor or contributor at 4YFN Shanghai at https://www.4yfn.com/shanghai/.