Emerging Fintech Business

Models
A closer examination of few business models that are reshaping the financial landscape

The Fastest Way to Pay

Overview

Previously, financial technology served as a back-office support function for bankers and traders. Venture capitalists made

only a few investments in the sector. The industry's public companies were rarely compared to the high-growth darlings

of Silicon Valley. But everything has changed. Private venture capital has skyrocketed in the last decade, with the share of

investment dollars going into fintech increasing from 5% to nearly 20%. Fintech has established itself in the innovation

economy.
New take on old lending categories through digital decision-making

● The now-public LendingClub with personal loans

● Bread and Affirm paved the way for POS financing

● Square Capital’s focuses on merchant cash advances

● Prosper and Avant offer personal loans

● SoFi has expanded from student loans to personal loans

● Tradeshift is taking on supply-chain

Mobile-only lending as an example of underwriting innovation

● Tala and Branch both seek to offer microlending over mobile devices in developing countries

● The US-based companies make real-time loan decisions dynamically by using every piece of information they can

gather from the customer’s mobile phone; public reports note that the companies use

○ Text messages

○ Contacts, and

○ Hundreds of other data points to make underwriting decisions

Demographic-focused products
A new set of companies are developing demographically-focused products. They segment not only from a brand and

marketing perspective, but from a product innovation perspective as well.

● True Link Financial’s elder fraud protections

● Finhabits’ saving focus for Latino’s

● Camino Financial’s lending for Latino-owned small and medium size businesses
Blockchain for infrastructure cost reduction

A new generation of blockchain firms are focussing on specific use cases to improve the cost and functioning of core

infrastructure.

● R3, Symbiont, and Blockstream are all working on general solutions

● while The Interface Financial Group and ConsenSys are targeting supply chain
The Wildcards: Tech companies in Financial services

Banks are data and technology companies. Recordkeeping and ledgering, transaction tracking, identity, and predictive

modeling are all fundamental concepts in both banking and software engineering.

● Apple’s launch of a credit card may represent a new phase for branded fintech experiences

● The launch of shopping on Instagram and WhatsApp testing payments in India both represent steps by Facebook

into financial services

Thank you