In the wake of what is happening in the innovation ecosystem as a whole, sustainable growth is the order of the day. And with their flight plan in place, fintechs – companies that combine technology and financial services – could grow by 15% a year by 2028 worldwide.
This is what McKinsey’s new global survey of more than 100 executives, founders, investors and senior leaders in the ecosystem shows. The data shows that, although there is turbulence, it is possible to find an (almost) brigadier sky.
The study shows that the revenue of fintechs is expected to grow almost three times more than that of incumbents by 2028. Compared to the 6% annual revenue growth of the traditional banking sector, young digitally native financial companies could achieve a 15% gain over the next five years worldwide.
But to reach that point, 80% of the companies interviewed are making changes to their operating models and looking to cut the cost of serving. The difference between the profitable fintechs was the reduction in expenses, not the growth in revenue. According to the survey, many of these organizations will also succeed more quickly through acquisitions and partnerships – almost 60% of the executives heard in the survey said they were considering an acquisition in the next 18 months.