The fintech industry has been rapidly evolving over the past few years, transforming the way we think about financial services. In recent years, the fintech infrastructure market map has become an important tool for understanding the fintech ecosystem and identifying potential opportunities for investment.
In this article, we will delve into the detailed market map of fintech infrastructure, identifying key categories and players that shape this ever-evolving industry.
We will explore consumer fintech use cases, categories for B2B fintechs, enabling infrastructure, investment trends, emerging trends, as well as opportunities and challenges within the fintech infrastructure market map. This comprehensive guide will provide insights into the essential infrastructure that underpins the fintech sector and shed light on the future outlook of the market.
Fintech Infrastructure Market Map: The Three Broad Categories
According to a Redpoint market map, the fintech industry can be broadly divided into three categories: consumer, B2B, and infrastructure. The market map further segments the industry by use case, such as banking and saving, credit and lending, trading and wealth planning, insurance, P2P payments, and real estate for consumer fintechs. For B2B fintechs, the categories include payments, insurance, financial management and workflows, lending, and banking. The enabling infrastructure category is broken down into nine use cases.
Use Cases for Consumer Fintechs
The consumer fintech space has grown rapidly in recent years, with new startups emerging to disrupt traditional financial services. Within the consumer fintech category, there are several use cases that are driving innovation. These use cases include:
- Banking and Saving: Fintech companies are offering new ways to bank and save, such as mobile banking apps, digital wallets, and robo-advisors.
- Credit and Lending: Fintech companies are using data and technology to offer new forms of credit and lending to consumers, including peer-to-peer lending, student loan refinancing, and small business loans.
- Trading and Wealth Planning: Fintech companies are disrupting traditional wealth management by offering low-cost investment options, automated financial planning, and algorithmic trading tools.
- Insurance: Fintech companies are using data and technology to offer new types of insurance, including peer-to-peer insurance, on-demand insurance, and microinsurance.
- P2P Payments: Fintech companies are offering new ways for consumers to send and receive money, including mobile payments, digital wallets, and peer-to-peer payment platforms.
- Real Estate: Fintech companies are transforming the way we invest in real estate, offering new ways to buy and sell property, as well as new ways to invest in real estate.
Categories for B2B Fintechs
In the B2B fintech space, there are several categories that are driving innovation. These categories include:
- Payments: Fintech companies are developing new payment technologies, such as mobile payments, digital wallets, and blockchain-based payment systems.
- Insurance: Fintech companies are using data and analytics to help insurance companies underwrite policies more efficiently and accurately.
- Financial Management and Workflows: Fintech companies are offering new technologies to help businesses manage their finances more efficiently, including accounting software, invoicing tools, and expense management systems.
- Lending: Fintech companies are using data and technology to offer new forms of lending to businesses, including invoice financing, supply chain financing, and merchant cash advances.
- Banking: Fintech companies are disrupting traditional banking by offering new ways for businesses to manage their finances, including digital banking platforms, online lending, and cash management tools.
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|Categories for B2B Fintechs|
|Financial Management and Workflows|
The enabling infrastructure category is the backbone of the fintech industry, providing the technology and tools that power fintech innovation. This category is broken down into nine use cases, including:
- Core Banking and Digital Banking Platforms
- Payments Infrastructure and Gateways
- Data and Analytics
- Identity and Access Management
- KYC/AML Compliance
- Fraud Detection and Prevention
- Regulatory Compliance
- APIs and Integration Platforms
Understanding the fintech infrastructure market map is essential for investors, entrepreneurs, and anyone who wants to stay up-to-date with the latest trends in the fintech industry. By understanding the different categories and use cases, you can identify potential investment opportunities and stay ahead of the curve in this rapidly evolving industry.
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Fintech Infrastructure Market Overview
Despite the economic uncertainties of recent times, the fintech industry has remained a hotbed of activity, with significant investment pouring into the sector. However, there have been some notable shifts and trends that are worth exploring.
According to a Pitchbook report, enterprise fintech companies, particularly those in the CFO stack segment, remain attractive to investors despite economic uncertainty due to their importance for businesses and potential for growth.
However, there has been a decline in deal value in Q4 2022, and exit activity in fintech is stagnating. Notable deals in Q4 include TRM Labs and Updraft, while notable exits include Nearside and OpenClose.
As noted earlier, the enabling infrastructure category is a crucial part of the fintech industry, providing the technology and tools that power fintech innovation.
According to CB Insights, fintech startups are leveraging the surge in B2B infrastructure development to outsource complex processes and integrate external APIs into their stack, reducing time to market and barriers to entry.
This approach is similar to the effect AWS had on cloud-based internet companies earlier this decade. CB Insights has identified over 60 companies building the fintech infrastructure layer.
The fintech industry is constantly evolving, with new trends and technologies emerging all the time. According to Medha Kagarwal on LinkedIn, some of the emerging trends in fintech infrastructure include:
- Open banking: Open banking is a regulatory framework that allows third-party providers to access financial information from banks and other financial institutions. This trend is driving innovation in the fintech industry and enabling new products and services to emerge.
- Digital identity: Digital identity is becoming increasingly important in the fintech industry, with many companies developing new technologies to verify identities and prevent fraud.
- Artificial intelligence: Artificial intelligence is being used in a variety of ways in the fintech industry, from fraud detection and prevention to customer service and marketing.
- Blockchain: Blockchain technology is being explored by many fintech companies as a way to improve transparency, security, and efficiency in financial transactions.
Understanding the market overview is crucial for investors and entrepreneurs, as it can help identify potential investment opportunities and stay up-to-date with the latest trends in the fintech industry. While the industry continues to evolve rapidly, keeping an eye on key trends and shifts can help you stay ahead of the curve.
Opportunities in the Fintech Infrastructure Market Map
The fintech infrastructure market map offers a wealth of opportunities for investors and entrepreneurs looking to get involved in the fintech industry. In this section, we will explore some of the most promising areas of opportunity within the fintech infrastructure market map.
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Core Banking and Digital Banking Platforms
Core banking and digital banking platforms are a crucial part of the fintech infrastructure market map, providing the backbone for many fintech products and services. Companies in this space are focused on developing technologies that improve the speed, security, and efficiency of financial transactions. Some of the most promising companies in this space include:
- Mambu: Mambu is a cloud-based banking platform that enables banks and other financial institutions to rapidly deploy new products and services.
- Thought Machine: Thought Machine is a cloud-native core banking system that enables banks to offer new products and services more quickly and efficiently.
- Solarisbank: Solarisbank is a banking-as-a-service platform that enables companies to offer their own financial products and services without needing to become a licensed bank themselves.
Payments Infrastructure and Gateways
Payments infrastructure and gateways are another important area of opportunity within the fintech infrastructure market map. Companies in this space are focused on developing technologies that enable fast, secure, and efficient payments. Some of the most promising companies in this space include:
- Adyen: Adyen is a payments platform that enables businesses to accept payments from all over the world.
- Stripe: Stripe is a payments infrastructure platform that enables businesses to accept payments online and in-person.
- Braintree: Braintree is a payments gateway that enables businesses to accept payments online and in-app.
Data and Analytics
Data and analytics are becoming increasingly important in the fintech industry, with many companies leveraging data to develop new products and services and improve existing ones. Companies in this space are focused on developing technologies that enable the collection, analysis, and utilization of data. Some of the most promising companies in this space include:
- Plaid: Plaid is a data aggregator that enables companies to access financial data from banks and other financial institutions.
- MX: MX is a data platform that enables companies to access and analyze financial data from multiple sources.
- Yodlee: Yodlee is a data aggregator that enables companies to access financial data from banks and other financial institutions.
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As the fintech industry continues to grow, cybersecurity is becoming an increasingly important concern. Companies in this space are focused on developing technologies that improve the security of financial transactions and protect against cyber attacks. Some of the most promising companies in this space include:
- Forter: Forter is a fraud prevention platform that uses machine learning to detect and prevent fraud in real-time.
- Shape Security: Shape Security is a cybersecurity company that uses AI to protect against automated attacks.
- Onfido: Onfido is an identity verification platform that uses AI and machine learning to verify the identity of customers.
Regulatory compliance is an important area of opportunity within the fintech infrastructure market map, as companies in this space are focused on developing technologies that help fintech companies comply with regulations and avoid legal pitfalls. Some of the most promising companies in this space include:
- ComplyAdvantage: ComplyAdvantage is a regtech company that uses AI to help fintech companies comply with regulations.
- Trulioo: Trulioo is an identity verification platform that helps fintech companies comply with anti-money laundering (AML) regulations.
- ClauseMatch: ClauseMatch is a regtech company that helps financial institutions comply with regulatory requirements and reduce compliance costs.
By focusing on these areas of opportunity within the fintech infrastructure market map, investors and entrepreneurs can position themselves for success in the rapidly evolving fintech industry.
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Challenges in the Fintech Infrastructure Market Map
While the fintech infrastructure market map offers a wealth of opportunities, there are also several challenges that companies in this space must navigate. In this section, we will explore some of the most significant challenges facing the fintech infrastructure market map.
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As noted earlier, regulatory compliance is an important area of opportunity within the fintech infrastructure market map. However, it is also one of the biggest challenges facing fintech companies. Fintech companies must comply with a range of regulations, including anti-money laundering (AML) regulations, know-your-customer (KYC) regulations, and data privacy regulations. Failure to comply with these regulations can result in significant fines and reputational damage.
Cybersecurity is another major challenge facing the fintech industry. Fintech companies handle sensitive financial data, making them attractive targets for cybercriminals. Cybersecurity threats include hacking, phishing, and social engineering attacks. Fintech companies must invest in robust cybersecurity measures to protect against these threats.
Talent Acquisition and Retention
The fintech industry is highly competitive, with companies vying for top talent in technology, finance, and other areas. Fintech companies must offer competitive salaries and benefits packages to attract and retain top talent. Additionally, fintech companies must provide opportunities for career growth and development to keep employees engaged and motivated.
Funding and Capital Raising
While the fintech industry has attracted significant investment in recent years, raising capital can still be a challenge for many companies, particularly those in the early stages of development. Fintech companies must have a strong business plan and a compelling value proposition to attract investors.
Integration with Legacy Systems
Many fintech products and services must integrate with legacy systems in banks and other financial institutions. This can be a challenge, as legacy systems are often complex and difficult to integrate with. Fintech companies must invest in technologies and partnerships that enable seamless integration with legacy systems.
Customer Acquisition and Retention
Acquiring and retaining customers can be a significant challenge for fintech companies, particularly in crowded markets. Fintech companies must invest in marketing and customer acquisition strategies that differentiate them from their competitors. Additionally, fintech companies must provide exceptional customer service and user experiences to retain customers.
By understanding and addressing these challenges, fintech companies can position themselves for success in the highly competitive fintech infrastructure market map.
Future Outlook for the Fintech Market Map
With continued expansion and innovation on the horizon, the fintech infrastructure market map has a promising future. In this section, we’ll look at some of the cutting-edge fintech trends and technologies that will influence the future of the sector in general.
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Artificial intelligence and Machine Learning, respectively
In the fintech sector, artificial intelligence (AI) and machine learning (ML) are becoming more and more crucial, and many businesses are looking into novel applications for these technologies. Among other things, AI and ML can be used for fraud detection and prevention, customer service, and risk management. These technologies are likely to play a bigger part in the market for fintech infrastructure as they continue to develop.
Blockchain and Cryptocurrencies
In the fintech industry, blockchain technology and cryptocurrencies are also emerging as significant trends. To increase transparency, security, and efficiency in financial transactions, many fintech businesses are looking into the use of blockchain technology. With many fintech companies offering cryptocurrency trading and investment products, cryptocurrencies are also growing in acceptance.
Open Banking and APIs
In the fintech sector, open banking and APIs are fostering innovation, enabling new goods and services to materialize. Open banking is opening up new opportunities for fintech companies to create cutting-edge solutions for customers by enabling third-party providers to access financial information from banks and other financial institutions.
Digital Identity Verification
In the fintech sector, digital identity verification is becoming more and more crucial as more businesses create new technologies to verify identities and stop fraud. These technologies are likely to play a bigger part in the market for fintech infrastructure as they continue to develop.
Environmental, social, and governance (ESG) Investing is important.
With many fintech companies offering ESG investment products, environmental, social, and governance (ESG) investing is emerging as a significant trend. ESG investing is probably going to gain even more popularity as consumers become more and more concerned about how their investments affect society and the environment.
With new trends and technologies constantly emerging, the fintech infrastructure market map is a dynamic landscape. Investors and entrepreneurs can position themselves for success in the fintech sector by keeping an eye on these cutting-edge trends and innovations. Even though there are undoubtedly obstacles to be overcome, the fintech sector appears to have a bright future and enormous potential.
The Fintech Infrastructure Market Map contains important players.
From startups to established players, the fintech infrastructure market map is home to a wide variety of businesses. We’ll look at some of the key players in the fintech infrastructure market map in this section.
Businesses can accept payments online and in-person thanks to Stripe, a payments infrastructure platform. Since its founding in 2010, the company has spread to more than 40 nations. Millions of companies all over the world use Stripe, from small startups to big businesses. In addition to its payments platform, Stripe provides a range of other goods and services, such as subscription management and fraud prevention.
Businesses can access financial information from banks and other financial institutions thanks to Plaid, a data aggregator. Since its founding in 2013, the company has grown to rank among the most significant players in the fintech infrastructure market. Numerous businesses use Plaid’s platform, from small startups to big enterprises. Plaid provides a range of other goods and services, such as identity verification and account authentication, in addition to its data aggregation platform.
The thought machine is located in the center.
Banks can provide new goods and services more quickly and effectively thanks to the cloud-native core banking system known as Thought Machine. Since its founding in 2014, the company has risen to the top of the fintech infrastructure market map worldwide. Banks from all over the world use the platform of Thought Machine, including Standard Chartered and Lloyds Banking Group. In addition to its core banking platform, Thought Machine provides a range of additional goods and services, such as fraud detection and prevention.
Businesses can send payments from all over the world thanks to Adyen, a payments platform. Since its founding in 2006, the company has grown to rank among the most significant players in the fintech infrastructure market. Numerous businesses, including Uber, Spotify, and Etsy, use Adyen’s platform all over the world. Adyen provides a variety of other goods and services, such as risk management and fraud prevention, in addition to its payments platform.
Banks and other financial institutions can quickly deploy new goods and services thanks to Mambu, a cloud-based banking platform. The company was established in 2011 and has since risen to the top of the fintech infrastructure market. Banks and other financial institutions, such as ABN AMRO and Santander, use Mambu’s platform all over the world. In addition to its banking platform, Mambu provides a range of other goods and services, such as loan origination and servicing.
Fintech Infrastructure Market Map Key Takeways
Numerous businesses, each offering special goods and services, can be found on the fintech infrastructure market map. Investors and entrepreneurs can position themselves for success in the rapidly evolving fintech sector by being aware of the important market players.
The future of the fintech infrastructure market map is being shaped by these significant players, who are fostering innovation.
With new opportunities and difficulties constantly emerging, the fintech infrastructure market map is a dynamic landscape. In this article, we’ve looked at some of the key fintech trends and technologies that will shape the future of the sector.
We have also highlighted some of the key players in the fintech infrastructure market map, each offering special goods and services.
It is crucial for investors and entrepreneurs to stay current and knowledgeable about the most recent trends and developments as the fintech industry develops. You can position yourself for success in this dynamic and exciting industry by staying on top of the curve.
We appreciate you taking the time to read this. Check out our other excellent articles on fintech and related topics if you liked this content.
Fintech Companies Latam
Defi bank focus on improving the financial inclusion for the GenZ. Financial industry doesn’t know anything about Genz and there´s a 2.5B billion market worldwide.
Ubanku, starts being the first step of the financial life for them, with a frictionless marketplace that can save money with a cashback of products and services of the university life, access to micro loans, all this, while they learn about finance, this allow us to create an innovating score system to connect GenZ with other financial products.
Creditop is a loan aggregator that processes any credit request by centralizing lenders and connecting customers with their ideal loan.
We have disbursed +$7.5M in mortgages, car and personal loans with a profitable pricing model in each transaction.
Our mission is to improve life quality through credit efficiency in LatAm. Founders:
Ini, a SaaS and white label fintech platform that allows any -wannabe fintech-company to scale their own payment network and expand their ecosystem into new markets and territories without losing the core focus of their businesses even when there is no connectivity access.
Inipay ́s IP tech (POS terminals + alternative connectivity) is also an enabler to reach new markets and niches such as events, concerts, stadiums, national parks, tourism and hospitality.
Aviva is an AI startup following a unique approach to unsecured and productive credit for the underserved communities in Mexico.
Now imagine you are an unbanked person and all that you need to do for getting your first loan is having a face-time call. They have a great experience building Konfio (Mexican Unicorn). Founders:
A digital financial services platform for Bolivia, Paraguay, Ecuador and Peru; where the vast majority don’t have access to financial services or are drastically underserved by traditional banks.
Koban allows users to perform an array of financial services including online and offline payments, money transfers, budgeting tools and credit solutions, among other services for consumers and SMBs in the region.
Zenpli is an infrastructure focused SaaS working on putting a stop to the KYC and fraud challenge in LatAm.
Through 1-single integration, LatAm fintechs and other digital innovators seamlessly onboard more good customers by accessing best-in-class data across all domains and running accurate end-to-end identity decisions supported by advanced models that are hard to spoof.
We’re rolling our product with Mastercard in Mexico in Q4 2022 with the potential to generate ~500k in ARR over the next 12-months.
We’re backed by The Fintech Fund, Ralicap, Amador, Newtopia and world-class angels and advisors from C-level and VPs at Socure, EPAM, Konfío, R2 and Bureau.id.
Kashin (YC S22) is Square with working capital for micro-merchants in LATAM.
We control risk with collaborative credit scoring and our vision is to become the primary financial platform for the masses.
Before Kashin, the founders led Cabify, the largest regional Uber competitor, and grew it from 0 to $50m in annual revenue.
Buy now, pay later without credit cards.
WIBOND is a digital payment method to pay in small installments and without the need of a credit card.
It shows the best payment options according to each customer’s possibilities so they can enjoy their favorite products.
Tapi is a Fintech B2B. Next-generation API-first network for billers, partners and their clients to re-envision the way bills get paid in LATAM.
Z1 is the Brazilian Gen Z neobank, where teenagers and young adults can begin their journey to financial independence.
Through Z1’s banking app, users can send and receive money from parents, employers or clients from their side gigs, as well as spend the money through a physical and virtual card.
BOTIN is an investment super app and a one stop shop to trade traditional and non-traditional assets; its vision is to make the wealth generation tools of the 1% available to all.
Through its Neo broker stock trading app gives users a simple and direct access to invest in different assets across multiple industries and territories (e.g., ETFs and stocks from USA, real estate, crypto, tokens, and others).
BOTIN is focused in helping 300 million people in Spanish speaking Latin America to protect their savings and have an option for retirement.
YUNO wants to bring to Latin American companies an easy online checkout solution that solves the pain point of managing multiple payment methods, as well as fraud detection tools, which can be costly and painful to manage.
Q & A Fintech Infrastructure Market Map
Who are the key players in the fintech infrastructure market map?
Stripe, Plaid, Thought Machine, Adyen, and Mambu are some of the key players.
What is the fintech infrastructure market map?
It is a categorization of the fintech industry into three categories: consumer, B2B, and infrastructure.
How is AI and ML impacting the fintech infrastructure market map?
AI and ML are being used for fraud detection, risk management, and customer service.
Who can benefit from the fintech infrastructure market map?
Investors, entrepreneurs, and businesses can benefit from the insights provided by the market map.
What are the emerging trends in the fintech infrastructure market map?
Emerging trends include blockchain, open banking, digital identity verification, and ESG investing.
How can businesses use the fintech infrastructure market map to their advantage?
By understanding the market map, businesses can identify new opportunities and develop innovative solutions for customers.
What challenges are faced by the fintech infrastructure market map?
Challenges include economic uncertainty, regulatory hurdles, and the need to constantly innovate.