Alternative finance firms, digital banks star in new FinTech50 list

By Ryan Weeks on 7th June 2017

P2P/Marketplace LendingAlternative CreditRobo-AdviceChallenger Banks

Two peer-to-peer lenders and major robo-advisor Nutmeg ascend to “Hall of Fame”.

Alternative finance firms, digital banks star in new FinTech50 list

Two peer-to-peer lenders and major robo-advisor Nutmeg ascend to “Hall of Fame”.

The latest iteration of the FinTech50 list is out, and alternative finance providers and digital banks account for a fifth of its constituents. Atom Bank, Monzo, N26, Revolut and solarisBank AG make up the banking challengers, with MarketInvoice, Iwoca, LendInvest, RateSetter and Seedrs representing the alternative finance sector.

Meanwhile, ten firms that were omitted from the list – seemingly due to having moved beyond startup status – have arisen into the FinTech50 Hall of Fame. This celestial bunch, deemed “remarkable game changers” by FinTech50, includes peer-to-peer lenders Funding Circle and Zopa, as well as leading robo-advisor Nutmeg. Swedish point-of-sale finance specialist Klarna has also picked up its golden jacket, as has money transfer giant TransferWise.

The annually-assembled roster that is FinTech50 began with a long-list of over 1,500 companies this year. The organisers said that this was the most “hotly contested” list since its inception in 2013. 24 of the companies in the chosen 50 are new to the list.

“There are 24 companies new to the FinTech50 this year and some are relatively new businesses which are already experiencing strong growth – or considerable interest in their product,” said Julie Lake, founding director of the FinTech50. “Unsurprisingly, these companies are often working ‘with’ financial institutions in areas which improve efficiency or customer services.”

Lake said that fintech companies choosing to work with banks is a “powerful trend”, but that there is a new generation of disruptors which, in certain niches, are going direct to consumers. She identifies insurance and financial management as two such areas.

Lake also suggests that customers have shown an “emerging evangelism” for challenger brands over the past year. She said that while fintech challengers may not have the customer volume of incumbents, “they are winning hearts and minds in a style more often associated with consumer goods”.

She is quite right to highlight the importance of evangelism of this kind. To a far greater extent than the industry’s own respect for itself, customer advocacy will be a crucial factor in the widespread adoption of new financial technologies. 

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Companies in this Article:

Funding Circle
MarketInvoice
RateSetter
LendInvest
Atom Bank
Revolut
Nutmeg
Klarna
Seedrs
Monzo
Iwoca
Zopa
Circle

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