What European fintechs can learn from Africa
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Published 2 months ago
Jean-Paul Mergeai, President of APAC and MEA, Temenos
There is a radical transformation taking place in financial services and a rapid rise in digital banking – a worldwide trend only accelerated by COVID-19. Yet according to a McKinsey study released in September last year, the European fintech sector faces an “existential crisis”.
It is fair to say that European fintech had a tough 2020. Recent results have demonstrated – like many had suspected – that fintechs are struggling to monetize their scale to turn a profit. Now COVID-19 has slowed ventured capital funding and is exposing business model vulnerabilities. Dealroom figures shows that investment into the sector dropped by 30 per cent in the first half of 2020. That is compared to 10 per cent globally. Fintechs also find themselves exempt from Government loan bailout schemes due to their pre-profit status.