The global fintech-as-a-service market size was worth USD 245.4 billion in 2021 and is estimated to grow to USD 1000 billion by 2030, with a CAGR of approximately 16.90 percent over the forecast period.
The fintech-as-a-service is software that uses financial services to automate and enhance the customer experience. For business owners, it makes managing financial operations easier. Using specialized algorithms and software helps businesses, business owners, and consumers manage their procedures, financial processes, and lives in a better way. The market is expected to increase because consumers use their cell phones more frequently for online transactions and fintech-related services delivered through digital platforms. Furthermore, the increase in bank investments in cutting-edge technologies for enhancing their products and customer experiences might be attributed to market growth. Financial institutions see a surge in demand for fintech as a service (FaaS), or the delivery of financial technologies as a service, to improve their end-to-end processes and adhere to banking rules cost-effectively. The need for FaaS systems is being driven by the advantages provided by FaaS, such as low maintenance fees, inexpensive processing fees, protection against fraud and chargebacks, and greater customization.
The increasing investments in the banking and finance industry to modernize and improve customer experience are likely to increase the size of the worldwide fintech-as-a-service market. Today’s digital world has seen rapid technical improvements across practically all industries due to technology’s advantages for streamlining operations and enhancing corporate productivity. Global market growth is projected to be aided by consumers’ preference to move toward digital technology. In addition, the global market is seeing an increase in different collaborations between banks and Information technology (IT) service providers as a result of more and more financial service providers taking significant and deliberate steps to meet client demands. A substantial global market development driver is projected to emerge from such a positive approach and the increase of fintech-as-a-service providers.
Since fintech as a service deal with enormous sums of money, there is a propensity for end users to lack trust in general when it comes to the full adoption of FaaS systems. As a result, the growth of the global market is predicted to be constrained by pervasive skepticism. Furthermore, FaaS systems deal with monetary transactions and cater to financial institutions. Therefore, they must carefully abide by the rules set down for financial institutions or closely linked fields to earn greater respect. The issue becomes more serious when domestic businesses attempt to grow abroad or conduct international business. It is predicted that such slow development will prevent the global market from growing to its full potential.
The global fintech-as-a-service market has been segmented into type, technology, application, and end-use.
Based on type, the market is divided into fintech-as-a-service for payment, fintech-as-a-service for funds transfer, fintech-as-a-service for loans, and fintech-as-a-service for other classes. Among these, the fintech-as-a-service for payment segment led the market in 2021 and is expected to maintain its dominance throughout the forecast period. The segment’s growth is predicted to be pushed by the growing integration of AI technology and API into mobile-based payment services for traditional banking. Besides, the fintech-as-a-service category is anticipated to grow significantly over the forecast period. In addition, some retail businesses also introduced contactless payments simultaneously to give customers a safe and secure form of payment.
Based on end-use, the market is classified into banks, financial lending companies, insurance, and other end-use. In 2021, the insurance category dominated the global market. Insurance companies use fintech-as-a-Service platforms to process claims and calculate risks accurately, which is projected to fuel the segment’s growth. Some retail businesses also introduced contactless payments to give customers a safe and secure payment. The market is expected to be driven by the insurance industry’s rising need for fintech-as-a-service platforms. Besides, the financial lending companies category is anticipated to grow the market at a significant rate over the forecast period. The segment is growing as consumers increasingly desire to use financial instruments conveniently from home.
In 2021, North America dominated the market for fintech-as-a-service. Due to factors including rising BFSI industry investment across the region and the presence of built infrastructure for cutting-edge technologies like 5G, AI, and ML in the banking and finance sector, the North American region exhibits considerable growth in the fintech-as-a-service market. For instance, according to AppsFlyer, the number of downloads of fintech apps increased by up to 110% during the previous two years. The US Additionally, US fintech app marketers contribute more than 35% of global budgets and will spend USD 985 million on user acquisition in 2020. Such changes increase the need for the North American fintech-as-a-service market. Furthermore, North America has seen a substantial increase in digital transformation use in recent years. As digital wallets can be accessed via mobile or smartphones, the rising popularity of smartphones among Americans and Canadians promotes the growth of the fintech-as-a-service market.
Some of the main competitors dominating the global fintech-as-a-service market include- PayPal Holdings, Inc., Block, Inc., Mastercard Incorporated, Envestnet, Inc., Upstart Holdings, Inc., Rapyd Financial Network Ltd., Solid Financial Technologies, Inc., Railsbank Technology Ltd., Synctera Inc., and Braintree.
The COVID-19 pandemic was a significant factor in the market’s expansion throughout the anticipated time frame. As more people were confined to their houses, contactless payment techniques and digital financial services became more popular. Customers worldwide were embracing contactless payment options as a secure form of exchange. Some retail businesses also introduced contactless payments to give customers a safe and secure payment. The increased use of digital fintech services during the pandemic, such as digital wallets, is positive for fintech as a service.
Fintech-as-a-Service Market by Type
Fintech-as-a-Service Market by Technology
Fintech-as-a-Service Market by Application
Fintech-as-a-Service Market by End Use
Fintech-as-a-Service Market by Region
| Fintech-as-a-Service Market Report Scope | |
| Report Attribute | Details |
| Market Size Value in 2022 | USD 286.87 billion |
| Revenue Forecast in 2030 | USD 1000 billion |
| Growth Rate | CAGR of 16.9 % from 2022 to 2030 |
| Base Year for Estimation | 2021 |
| Historical Data | 2017 – 2021 |
| Forecast Years | 2022 – 2030 |
| Quantitative Units | Revenue in USD million and CAGR from 2022 to 2030 |
| Report Coverage | Revenue forecast, company ranking, Trends competitive landscape, and growth factors |
| Segments Covered | Type, Technology, Application, End Use, and Region |
| Regional Scope | North America; Europe; Asia Pacific; Latin America; Middle East & Africa |
| Country Scope | U.S.; Canada; U.K.; Germany; China; India; Japan; Brazil; Mexico and Others |
| Key Companies Profiled | PayPal Holdings, Inc., Block, Inc., Mastercard Incorporated, Envestnet, Inc., Upstart Holdings, Inc., Rapyd Financial Network Ltd., Solid Financial Technologies, Inc., Railsbank Technology Ltd., Synctera Inc., and Braintree |
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