The fintech as a service (FaaS) market refers to the distribution of financial technology services via a platform or application programming interface (API). The term "financial technology" refers to new technology that aims to improve and automate the delivery and usage of financial services. It is used to help organizations, company owners, and consumers manage their financial operations, processes, and lives more effectively.
The growing need for digital financial services is propelling the expansion of fintech as a service industry. Furthermore, several countries have adopted open banking regulations that require financial institutions to securely exchange consumer data with authorized third-party providers. This encourages collaboration between traditional banks and fintech companies, resulting in a wider selection of services for consumers and boosting market growth. In addition, the rise of the API economy and the implementation of open banking regulations in many countries have accelerated the adoption of fintech as a service (FaaS). However, regulatory challenges and security & data privacy concerns are some of the factors that hamper fintech as a service market growth. On the contrary, digital transformation in financial services, and a shift toward open banking are expected to provide lucrative growth opportunities to fintech as a service market in the upcoming years.
The fintech as a service market is segmented into type, technology, application, end user, and region. By type, the market is classified into banking, payment, insurance, and others. Depending on technology, it is fragmented into AI, blockchain, robotic process automation (RPA), application programming interface (API), and others. By application, the market is categorized into fraud monitoring, KYC verification, compliance & regulatory support, and others. By end user, the market is divided into banks, financial institutions, insurance companies, and others. Region wise, the market is analyzed across North America, Europe, Asia-Pacific, and LAMEA.
The key players operating in the Fintech as a service market include Adyen, Finastra, FIS, Fiserv, Inc., Mastercard, OpenPayd, PayPal, Inc., Rapyd Financial Network Ltd., Revolut Ltd, and Stripe, Inc. These players have adopted various strategies to increase their market penetration and strengthen their position in the fintech as a service industry.
The growing need for digital financial services is propelling the expansion of fintech as a service industry. Furthermore, several countries have adopted open banking regulations that require financial institutions to securely exchange consumer data with authorized third-party providers. This encourages collaboration between traditional banks and fintech companies, resulting in a wider selection of services for consumers and boosting market growth. In addition, the rise of the API economy and the implementation of open banking regulations in many countries have accelerated the adoption of fintech as a service (FaaS). However, regulatory challenges and security & data privacy concerns are some of the factors that hamper fintech as a service market growth. On the contrary, digital transformation in financial services, and a shift toward open banking are expected to provide lucrative growth opportunities to fintech as a service market in the upcoming years.
The fintech as a service market is segmented into type, technology, application, end user, and region. By type, the market is classified into banking, payment, insurance, and others. Depending on technology, it is fragmented into AI, blockchain, robotic process automation (RPA), application programming interface (API), and others. By application, the market is categorized into fraud monitoring, KYC verification, compliance & regulatory support, and others. By end user, the market is divided into banks, financial institutions, insurance companies, and others. Region wise, the market is analyzed across North America, Europe, Asia-Pacific, and LAMEA.
The key players operating in the Fintech as a service market include Adyen, Finastra, FIS, Fiserv, Inc., Mastercard, OpenPayd, PayPal, Inc., Rapyd Financial Network Ltd., Revolut Ltd, and Stripe, Inc. These players have adopted various strategies to increase their market penetration and strengthen their position in the fintech as a service industry.
Key Benefits for Stakeholders
- The study provides an in-depth analysis of the fintech as a service market along with current trends and future estimations to illustrate the imminent investment pockets.
- Information about key drivers, restrains, & opportunities and their impact analysis on the Fintech as a service market size are provided in the report.
- The Porter’s five forces analysis illustrates the potency of buyers and suppliers operating in the industry.
- The quantitative analysis of the fintech as a service market from 2022 to 2032 is provided to determine the market potential.
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Key Market Segments
By Type
- Banking
- Payment
- Lending
- Others
By Technology
- Artificial Intelligence (AI)
- Blockchain
- Robotic Process Automation (RPA)
- Application Programming Interface (API)
- Others
By Application
- Others
- Fraud Monitoring
- KYC Verification
- Compliance and Regulatory Support
By End User
- Banks
- Financial Institutions
- Insurance Companies
- Others
By Region
- North America
- U.S.
- Canada
- Europe
- UK
- Germany
- France
- Italy
- Spain
- Rest of Europe
- Asia-Pacific
- China
- Japan
- India
- Australia
- South Korea
- Rest of Asia-Pacific
- LAMEA
- Latin America
- Middle East
- Africa
Key Market Players
- Finastra
- OpenPayd
- Rapyd Financial Network Ltd.
- FIS
- Stripe, Inc.
- Adyen N.V.
- PayPal, Inc.
- Revolut Ltd
- Fiserv, Inc.
- Mastercard Incorporated.
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Table of Contents
CHAPTER 1: INTRODUCTION
CHAPTER 2: EXECUTIVE SUMMARY
CHAPTER 3: MARKET OVERVIEW
CHAPTER 4: FINTECH AS A SERVICE MARKET, BY TYPE
CHAPTER 5: FINTECH AS A SERVICE MARKET, BY TECHNOLOGY
CHAPTER 6: FINTECH AS A SERVICE MARKET, BY APPLICATION
CHAPTER 7: FINTECH AS A SERVICE MARKET, BY END USER
CHAPTER 8: FINTECH AS A SERVICE MARKET, BY REGION
CHAPTER 9: COMPETITIVE LANDSCAPE
CHAPTER 10: COMPANY PROFILES
List of Tables
List of Figures
Executive Summary
According to this report, the fintech as a service market was valued at $268.41 billion in 2022, and is estimated to reach $1,432 billion by 2032, growing at a CAGR of 18.5% from 2023 to 2032.The fintech as a service market is likely to experience a significant growth rate of 18.5% from 2022-2032 owing to the increase in adoption of digital payment solutions and advancement of technology in financial services
Financial technology (FinTech) aims to improve and automate the delivery and usage of financial services. It is used to assist corporations, company owners, and consumers in better managing their financial operations, procedures, and lives. It is composed of specialized software and algorithms used on computers and smartphones.
Furthermore, fintech businesses are increasingly transforming the finance industry due to their cutting-edge technological capabilities. Fintech innovation is removing the barriers that have long constrained the old financial and banking system. They have brought a radical shift in the financial ecosystem by challenging existing value chains, and business models. It strengthens customer experiences and expectations by encouraging a more client-centric and interactive approach to financial and banking services.
The market also offers growth opportunities to the key players in the market. Key players are adopting strategies to strengthen their market positions in the fintech as a service industry, including new technology adoption, product developments, mergers and acquisitions, joint ventures, alliances, and partnerships. For instance, in February 2021, to drive digital payments acceptance by small businesses and startups in India, Mastercard and Razorpay launched a strategic partnership that combines Razorpay’s payment processing capabilities with Mastercard’s trusted and secure digital banking solutions and card services. The partnership empowers Indian micro, small and medium enterprises (MSMEs) in digitizing their operations and maintaining business continuity.
The fintech as a service market is segmented into type, technology, application, end user, and region. By type, the market is differentiated into banking, payment, lending, and others. Depending on technology, it is fragmented into artificial intelligence (AI), blockchain, robotic process automation (RPA), application programming interface (API), and others. By application, the market is differentiated into fraud monitoring, KYC verification, compliance & regulatory support, and others. The end user segment is divided into banks, financial institutions, insurance companies, and others. Region-wise, it is analyzed across North America (the U. S., and Canada), Europe (UK, Germany, France, Italy, Spain, and rest of Europe), Asia-Pacific (China, Japan, India, Australia, South Korea, and rest of Asia-Pacific), and LAMEA (Latin America, Middle East, and Africa).
The key players profiled in the study are Adyen, Finastra, FIS, Fiserv, Inc., Mastercard, OpenPayd, PayPal, Inc., Rapyd Financial Network Ltd., Revolut Ltd, and Stripe, Inc. The players in the market have been actively engaged in the adoption of various strategies such as business expansion, product launch, collaboration, and partnership to remain competitive and gain an advantage over the competitors in the market. For instance, in August 2023, Rapyd, the fintech-as-a-service startup that provides APIs to enable payments, card issuing, digital wallet, and other financial services to companies such as Uber and Ikea, acquired a giant PayU, the payments group of internet giant Prosus that focuses on emerging markets. The acquisition is a strategic move that continues the company’s global expansion across emerging markets in Central and Eastern Europe and Latin America.
Key Market Insights
By type, the payment segment was the highest revenue contributor to the market and is estimated to reach $501.35 billion by 2032, with a CAGR of 17.3%. However, the lending segment is estimated to be the fastest-growing segment with a CAGR of 21.1% during the forecast period.By technology, the artificial intelligence (AI) segment was the highest revenue contributor to the market, and is estimated to reach $405.75 billion by 2032, with a CAGR of 16.0%. However, the application programming interface (API) segment is estimated to be the fastest-growing segment with a CAGR of 22.4% during the forecast period.
By application, the compliance and regulatory support segment was the highest revenue contributor to the market, and is estimated to reach $434.17 billion by 2032, with a CAGR of 15.8%. However, the fraud monitoring segment is estimated to be the fastest-growing segment with a CAGR of 20.9% during the forecast period.
By end user, the insurance companies segment was the highest revenue contributor to the market, and is estimated to reach $599.07 billion by 2032, with a CAGR of 19.6%. However, the financial institutions segment is estimated to be the fastest-growing segment with a CAGR of 20.7% during the forecast period.
Based on region, North America was the highest revenue contributor, accounting for $101.38 billion in 2022, and is estimated to reach $452.65 billion by 2032, with a CAGR of 16.4%. However, Asia-Pacific is estimated to be the fastest-growing region with a CAGR of 21.7% during the forecast period.
Companies Mentioned
- Finastra
- OpenPayd
- Rapyd Financial Network Ltd.
- FIS
- Stripe, Inc.
- Adyen N.V.
- PayPal, Inc.
- Revolut Ltd
- Fiserv, Inc.
- Mastercard Incorporated.
Methodology
The analyst offers exhaustive research and analysis based on a wide variety of factual inputs, which largely include interviews with industry participants, reliable statistics, and regional intelligence. The in-house industry experts play an instrumental role in designing analytic tools and models, tailored to the requirements of a particular industry segment. The primary research efforts include reaching out participants through mail, tele-conversations, referrals, professional networks, and face-to-face interactions.
They are also in professional corporate relations with various companies that allow them greater flexibility for reaching out to industry participants and commentators for interviews and discussions.
They also refer to a broad array of industry sources for their secondary research, which typically include; however, not limited to:
- Company SEC filings, annual reports, company websites, broker & financial reports, and investor presentations for competitive scenario and shape of the industry
- Scientific and technical writings for product information and related preemptions
- Regional government and statistical databases for macro analysis
- Authentic news articles and other related releases for market evaluation
- Internal and external proprietary databases, key market indicators, and relevant press releases for market estimates and forecast
Furthermore, the accuracy of the data will be analyzed and validated by conducting additional primaries with various industry experts and KOLs. They also provide robust post-sales support to clients.
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