Weekly Research Highlights – 8 November 2022

For this week’s research article, we dive into new insights on fintech overview, digital payments and crypto. Enjoy researching!

Survey shows support for shorter settlement cycles (Finextra)
The majority of market participants expect the settlement cycle for equities to shorten to T+1 within the next five years, according to recently published research. The survey, conducted by Citi, showed that 51% of the 300 or so financial services firms, anticipate next day settlement by 2026, a seven point improvement on the previous year’s survey. According to Citi, this finding is supported by the actions of key equities markets in the US, Canada and Italy, which are actively moving towards T+1 settlement. Read more

UK climate tech investment doubles in 2022 (Business Cloud)
Tech Nation, the UK’s growth platform for tech scaleups, has published its Climate Tech Report 2022 ahead of COP27 this month. It revealed that international investment into UK climate tech companies has almost doubled, rising from $4 billion in 2021 to $7.5bn so far in 2022. While the trend is increasing for the UK and on a global level, this is not the case for all countries. Investment in the US, Germany and Sweden seems to be slowing down, receiving $2.1bn, $4.5bn and $2.2bn less investment in 2022 so far – compared to 2021 – respectively. The report says the UK is on track to see climate tech companies raising nearly $20bn per year by 2030. It is second only to the US for the number of companies working to address the climate crisis, with over 5,200 climate tech companies in the UK to date, compared with 14,300 in the US. Read more

Akamai: 49% of UK Consumers Don’t Trust Retailers to Keep Personal Details (The Fintech Times)
With retail sales volumes currently at an all-time low, Akamai and YouGov conducted research to understand consumer feelings toward shopping with online retailers. Recent Office for National Statistics (ONS) findings found that retail sales volumes fell by 1.4 per cent in September 2022. Akamai used a sample size of 2,171 UK adults, 2,116 of whom shop online. The firm’s research suggests a strong connection between a lack of trust in retailers and cybersecurity concerns. A majority (59 per cent) of UK online shoppers said that they would stop shopping at a retailer if they were ever the victim of a cyberattack. These findings suggest that many online shoppers are being put off from spending online. On the back of these findings, retailers may need to find solutions to regain trust and restore online spending to previous levels. Read more

Kenya, Nigeria and South Africa lead fintech growth in Africa, Mastercard report reveals (Business Ghana)
The report titled ‘The Future of Fintech: Rapid Growth Attracts Smart Capital”, further revealed that fintech startups took up 27% of all the record-breaking deals closed and 61% of the US$2.7 billion pumped into the startup ecosystem in 2021. It’s also the industry where deals went as high as US$100 million each. Ngozi Megwa, Mastercard’s Senior Vice President of Digital Partnerships in charge of the EEMEA region said, “At Mastercard, we are helping to fuel fintech acceleration by offering access to our expertise, network and technology. We provide a portfolio of technology solutions, APIs, developer tools, partner networks, startup programs and a community experience for every fintech company and payments developer, helping turn their bold ideas into reality.” Global fintech investments hit a record high of US$131.5 billion in 2021, with 235 unicorns mushrooming within the year. The rise of fintech startups in Africa is attributed to the desire to create solutions addressing various pain points and opening up digital inclusion. Read more

Mastercard Study: African Fintech Sector Had One of the Highest Year-on-Year Growth Rates in Funding in 2021(
In 2021, African fintech startups accounted for 61% of the $2.7 billion in venture capital funding that was deployed on the continent, a new study has found. While its share of global fintech funding is just over one percent, the continent’s fintech sector still recorded one of the highest year-on-year growth rates globally. According to the findings of a new Mastercard study, African fintech startups — whose number grew from 311 in 2019 to 564 in 2021 — accounted for “61% of the USD 2.7 billion deployed across Africa in 2021.” The findings also show that fintechs’ share “of the record-high number of deals closed” in that year was 27%.  Meanwhile, the report suggested that Nigeria, along with South Africa and Kenya, will continue to drive the sector growth. However, the study suggested that the fintech sector growth rate will depend on regulators’ and policymakers’ continued prioritization of “affordable internet and mobile penetration.” Read more

Mastercard Study: African Fintech Sector Had One of the Highest Year-on-Year Growth Rates in Funding in 2021

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