Weekly Research Highlights – 31 October 2023

The fintech industry is rapidly evolving and disrupting traditional financial systems. In this article, we bring you the latest research insights to help you stay ahead of the curve and understand the future of financial technology. Enjoy researching!

Arab open banking market set for 25 percent annual growth: Report (Fintech Galaxy)

According to a recent report released by the Arab Monetary Fund (AMF), the Open Banking market in Arab countries is projected to experience an annual growth rate of 25 percent over the next five years. The report, titled “Effective Open Banking/Finance Adoption,” was developed by the Arab Regional Fintech Working Group (WG) in collaboration with 10 Arab Central Banks and Fintech Galaxy, a regional Open Banking firm. This comprehensive guide aligns with the Fund’s commitment to assist Arab central banks in establishing a robust framework for implementing Open Banking/Finance initiatives. Read more

Auto-enrolment – savers with workplace pensions are more than twice as likely to be disengaged (IFA Magazine)

Savers with workplace pension schemes are significantly less likely to understand or engage with their pensions compared to their counterparts with personal pensions, according to new research from Moneyhub, the award-winning data and payments platform built on Open Banking and Open Finance principles. Moneyhub’s research revealed how approximately a quarter of savers with a workplace pension, either DB (26%) or DC (23%), never check their pension pots. In stark contrast, just 11% of respondents with self-invested pensions (SIPP) and 10% with self-employed pensions said they had never checked their pension. Read more

China to contribute over 30% of global economic growth in 2023 (China Daily)

China is projected to contribute more than 30 percent of global economic growth in 2023, highlighting the anchoring role of the world’s second-largest economy in a more vulnerable world, leading experts said at a forum on Saturday. Kristalina Georgieva, managing director of the International Monetary Fund, said the world has become more shock-prone after three years of COVID-19, conflicts and worsening climate disasters. The good news is that the world economy has shown resilience, with Asia faring better than other regions. Specifically, China alone is projected to contribute more than 30 percent of global growth this year, Georgieva said via video at the International Finance Forum (IFF) 20th Anniversary and Annual Meeting 2023 on Saturday. Read more

Four in ten SMEs prefer fintech lenders over mainstream banks when seeking business finance (Retail Banker International)  

Four in ten (40%) UK small and medium-sized businesses (SMEs) claim it is easier for them to access finance from fintech lenders rather than mainstream banks. The claim is made by alternative finance and payment solutions provider, Sonovate. It has released research noting that alternative finance options increasingly offer a lifeline for UK SMEs. Specifically, seven in ten (70%) admit they wouldn’t have survived the current cost of living crisis if it wasn’t for these types of lenders. Read more

FT Partners published a 2023 Q3 overview revealing a significant fintech resurgence (FT Partners

In Q3 2023, the FinTech sector saw a significant resurgence, with deal activity volume growing by 27%, hinting at a potential recovery from earlier setbacks. Early-stage funding remained dominant, while median Series A and Series B round sizes increased. InsurTech experienced remarkable growth, with funding surging over 130% to reach $2.7 billion, outpacing other FinTech sectors. Private equity buyouts, notably the $18.5 billion acquisition of Worldpay, fueled M&A activity. The IPO market made a comeback, featuring notable offerings like CAB Payments and Jio Financial Services. Despite a reduced number of deals, four new unicorns emerged, and valuation changes occurred, underscoring the sector’s dynamism. Globally, FinTech deal activity registered a 27% increase, suggesting a broader resurgence. Read more

Gallagher Re’s latest Global InsurTech report: Global InsurTech funding surpasses $1B in Q3 (Inside P&C)

In Q3 2023, global InsurTech funding exceeded $1 billion, marking the first quarter-on-quarter increase since Q4 2021, as reported in Gallagher Re’s latest Global InsurTech report. Notably, P&C InsurTech experienced a 25.5% increase in funding, rising from $742.29 million to $931.32 million, while L&H InsurTech funding decreased by 4.5% to $166.6 million, with the average deal size dropping to a six-year low of $10.36 million, down 16.4% from Q2. Read more

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