The rise and rise of the fintech industry looks set to continue in 2018, as U.S. fintech investment rose for the third consecutive quarter, boosted by a strong U.S. economy and a sharp rise in private equity (PE) investment. Funding for global fintech in 2017 surged to over $31 billion and there’s no sign of the upward trajectory changing. This makes it a global investment of $122 billion over just the past three years alone. U.S. full-year 2017 investment of $15.2 billion accounted for just over half the total global investment of $31 billion.
The Rise of Blockchain
As expected, blockchain technology and the advancement of smart contracts has been a significant factor in the fintech boom. For the first year ever, IOC’s have overtaken traditional routes of venture capitalism. More and more monies are being raised by Token soles than they are by traditional venture capitalism and this is being seen in the Fintech industry. One particular area is in the Insurtech Investment areas. Insurtech gained a lot of traction last year providing a solution to the operational difficulties faced by traditional insurance companies. Artificial Intelligence, machine learning, Internet of Things and blockchain all adding new dimensions and new avenues to explore in the fintech industry.
The Israel Factor in Fintech Industry
Israel has bloomed from unattended malaria-ridden swamps and lifeless deserts to become the start up capital of the world. New immigrants do not have to learn hebrew to get on, they have to learn coding.Having grew the Binary Options and forex industries to a $100 billion a year money maker, attention turned to fintech once the authorities turned on them. With many binary options brands closing or been forced to close, a dearth of technologically advanced and marketing-savvy Israelis turned their attention to fintech. Debt consolidation and loan companies are now operating on blockchain technology and the future seems limitless.
The fintech industry is continuing to evolve and expand. As the focus on insurtech and blockchain intensifies and developments continue to be made, challenger banks will look to expand. Regulations changes, particularly in Europe with Brexit and GDPR look set to provide further challenges for the Fintech market. Nobody quite knows where blockchain is going, but the pace at which blockchain technology is impacting upon the global economy, means that 2018 promises to be another year of high level growth for the fintech markets and all in all, an exciting year ahead for the fintech industry in general.