The growth outlook for revenue generated by financial technology companies is optimistic, according to a McKinsey report, but various regions will fare differently, with the share in Asia expected to shrink.
In 2022, fintech firms generated a net revenue of around $55-65 billion in Asia Pacific, according to a McKinsey report, accounting for 34 percent of the global market share. In 2028, fintech net revenue in the region is expected to double to $110-130 billion but the share could shrink to 30 percent.
North America is the only other region expected to see its fintech revenue share shrink from 48 percent in 2022 ($70-100 billion) to 41 percent in 2028 ($130-190 billion).
Europe, EM
In contrast, the report forecasts expanded revenue shares in Europe and most emerging markets. In Europe, the report predicts that revenue share will grow from 11 percent ($15-25 billion) in 2022 to 14 percent ($40-70 billion) in 2028. Enlarged shares during the same period are also expected in Latin America (5 to 9 percent), Africa (2 to 4 percent) and the Middle East (under 1 percent to 2 percent).
«While fintech penetration in emerging markets is already the highest in the world, its growth potential is underscored by a few trends,» said the report entitled «Fintechs: A new paradigm of growth». «Many of these economies lack access to traditional banking services and have a high share of underbanked population.»
From 2022 to 2028, global fintech revenue is expected to grow at an annual rate of 15 percent. While this outpaces the banking industry’s growth rate of roughly 6 percent, there is a large gap in the overall scale. In 2022, the banking industry generated $6.5 trillion in revenue compared to $150-205 billion in the fintech industry.
