As the demand continues to rise for tools such as digital banking, financial automation, and emerging frontiers such as DeFi, both emerging and incumbent players within the fintech sector are likely to emerge as some of the most exciting companies to follow in 2022. Rounding out our top 25 Fintech Companies to Watch in 2022 is Venmo. Several financial services innovators and larger fintech companies are driving a wave of takeovers, drawing investors to their offerings for new financial products and services.
Fintech companies globally have scooped $94.7 billion worth of financing over the first three quarters of 2021. Fintech startups were the biggest recipients of venture capital worldwide in 2021, accounting for roughly 21% of dollars raised, at $131.5 billion in 4,969 deals. With public fintech companies dipping 50% from November, VCs are placing the brakes on Fintech startups financing; US Fintech raised $13.3 billion during Q1-2022, down 27% from that same time period a year ago, according to data provider CB Insights.
In Q2 2022, for instance, the total dollars raised by privately held Fintech companies worldwide reached $27.5 billion, a 27% decrease from Q1 and 31% decrease from a year-ago period. In February 2020, shortly before Covid-19 struck the United States, the median valuation for Americas top 10 privately held fintech companies was $9 billion, with the cutoff to be on the list at $3.7 billion.
The most noteworthy newcomer on our list for 2022, and third-most valuable private fintech doing business in the United States, is cryptocurrency exchange FTX, which is valued at $32 billion today, having achieved unicorn status less than a year earlier. To give you an early look at emerging technologies and startups impacting the financial industry in 2022, we have analysed 2 306 total startups and scaling companies across global fintech. We have hand-picked 5 standout fintech startups according to our data-driven approach to scouting startups, taking into consideration factors like location, founding year, technology relevance, and funding, among others. Companies across the U.S. participated in the 2-part survey process to identify Arizents best places to work in financial tech.
As more companies are flooding into this space, it is difficult to sift through it all to determine the top players. The companies recognized in this years list work across a broad spectrum of financial services, serving businesses and consumers, including banking and mortgages, insurance, payments, and financial advisory. Financial Services — FinTech companies offer a broad range of services, from traditional banking services such as payments and money transfers, to digitally-enabled services that help major financial markets function more efficiently. Fintech defines any company offering financial services via software or other technology, from smartphones to cryptocurrency payment apps.
Fintech means finance + technology, which refers to combining the two in software, that aims to enhance and automate the provision and use of financial services. Fintech is the portmanteau of finance and technology, a broad category consisting of companies applying emerging technologies to finance activities. It works mostly by unbundling services from those companies and creating new markets for them.
As fintech has grown, fintech firms have emerged as viable alternatives to legacy financial services providers, offering a broad array of financial services, such as point-of-sale (POS) payments, enterprise crowdfunding, and personal market-based lending. Some financial institutions are integrating the new technologies to offer customers bundled, additional services, while the growing collaborations between domestic regulators and financial institutions are major factors propelling FinTech.
Banks are using fintech in the form of mobile banking apps. At the moment, fintech has made possible, never having to set foot inside of a bank, the ability to spend, borrow, save, and transfer funds via online and mobile services.
By linking bank accounts, cards, and customers IDs, physical and digital payments are combined in one seamless platform using FinTech. Fintech, or financial technology, has changed how finances are conducted through mobile banking, investments, and blockchain applications. The business of financial technology (FinTech) has been held back due to concerns over user data security.
Blockchain Technology: Companies across the worlds FinTech businesses are quickly adopting blockchain technology to enhance security and operational efficiencies. Fintech firms, including startups, tech companies, and existing financial institutions, are using digital innovations like big data and AI to enhance usability and productivity of financial services, blockchain, and edge computing.
The Fintech sector is growing each year, with markets starting to be filled by financial services providers and early-stage fintech startups looking to meet customers needs and shape the future of finance. Thousands of new startups are being founded each year — emerging companies that have the potential to disrupt the financial services industry. According to Modern Knowledge World, the center of fintech, or financial technology, is the US, with 1,491 startups and $58,5 billion invested in the industry.
Throughout 2021, the fintech industry continues to see rapid growth, with consumers and individuals digitizing and automating multiple aspects of their financial lives. During the COVID-19 pandemic, especially in emerging markets, the fintech industry continued to assist with expanding financial inclusion, driving robust growth for digital financial services of all types.
Finix is a fintech platform that helps SaaS companies create world-class payments experiences. Lumas Financial Technology Platform is a fintech company offering a suite of developer tools used to integrate payments and automate billing for any enterprise or marketplace. TrueLayer is a fintech app development and platform startup working to help empower businesses in building powerful financial apps.
For instance, companies developing new digital payments solutions are considered to be in the fintech space, as are companies building and operating personal payments apps. To be considered for inclusion, companies must offer products, services, or technological solutions that allow for financial services. As you can see, a lot of startups on this list are building new alternatives to banks and payments that will simplify things for customers.