It is no surprise that digital finance adoption has spread globally to provide more streamlined and efficient processes compared to its legacy counterparts. At Crowd Valley we often get asked the question, “What platforms are most successful” and “What verticals have had the best uptake”. For the former it relies on a well balanced matrix of experienced operations, quality deal flow and its community. Like any financial institution around the world, no amount of marketing can overcome poor investment prospectuses, higher than average defaults or general bad operational management.
The latter is local market driven, and will continue in this direction. Looking at adoption timelines for mature markets, they all follow a similar pattern. Over the past five years the US, UK and EU progress in a similar fashion from equity startup platforms (which have had a varying degree of success) moving onto debt/equity real estate and P2P lending platforms operated by well established financial players. The outliers in the mature markets are Australia and Japan which are at the start of their journey. No doubt the path made by US, UK and EU will drastically accelerate the adoption and use of best practise.
When established players enter digital finance it is a complementary addition to their core business, which puts them in a very strong position. Normally internally funded the struggle is less about working capital, deal flow quality or community but more about how to enter the market quickly whilst bypassing legacy internal controls and infrastructure.
Because of well established systems the pain point being solved by mature market platforms is friction driven. Emerging markets are plagued by the same legacy infrastructure and friction problems which is only compounded by unregulated and non standardized lending rates. This problem has pushed markets like Africa, Latin America and parts of Southeast Asia to solely focusing on platforms which deliver better and more consistent rates to consumers and SME’s.
Emerging markets have paved their own adoption timelines which have skipped from a focus on equity to solely debt based platforms serving their local communities. This ties into the role of FinTech globally, where the western world will use FinTech to make data sharing and banking procedures more streamlined. In emerging markets FinTech has the opportunity to literally shape the future of the banking in every aspect from payments, data API’s, wealth management, capital raises and access to financial services.
Please get in touch with us at Crowd Valley if you have questions surrounding the best vertical to focus on in your local market or how our digital finance infrastructure can help you enter the market in a meaningful way.
About the author - Pete Woodard
Pete has worked within FinTech since 2013 across a broad range of security applications serving multiple verticals. He has scaled Google Venture backed startups in the AdTech space before joining Crowd Valley. Originally from Canada with a education background in Mechanical Engineering and Marketing. Pete has helped to open up new global markets in the digital investing and lending space. When not firmly rooted in the London FinTech scene he enjoys travelling, always mixing business with pleasure. He has spoken to over 1000 digital investing entrepreneurs, which makes him a valuable resource for trends in new security models.
Pete has worked within FinTech since 2013 across a broad range of security applications serving multiple verticals. He has scaled Google Venture backed startups in the AdTech space before joining Crowd Valley. Originally from Canada with a education background in Mechanical Engineering and Marketing. Pete has helped to open up new global markets in the digital investing and lending space. When not firmly rooted in the London FinTech scene he enjoys travelling, always mixing business with pleasure. He has spoken to over 1000 digital investing entrepreneurs, which makes him a valuable resource for trends in new security models.
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