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Fintech startups re-bundling their products, expanding into new geographies: GlobalData

BENGALURU: GlobalData, a knowledge analytics firm, stated the development of worldwide funding to venture-backed fintech corporations rising within the later phases however with a pullback within the seed-stage signifies a common consolidation in direction of the maturing of the fintech sector, the place the startups want to scale up past their boundaries.
An evaluation of GlobalData seems to be at how numerous fintech corporations are attempting to increase because the fintech sector is stabilizing and maturing.

“The change in the venture capital (VC) funding equation over the last few years has encouraged the most successful fintech startups to gradually re-bundle their offerings in existing as well as new geographies, across the financial services value chain, by leveraging emerging technologies,” stated Sudheshna Karukula, Fintech Analyst at GlobalData.

GlobalData stated One97 Communications, the dad or mum firm of Paytm, turned the primary fintech unicorn in India after securing $1.6 billion in 2019. It intends to make use of the newest funding to service provider enlargement in each on-line and offline modes in addition to make an aggressive push into the digital banking and insurance coverage companies, it added. It began its journey as an internet cellular recharge and payments fee platform, and regularly scaled up into different digital monetary providers companies equivalent to banking and insurance coverage.

GlobalData additionally pointed at San Francisco-based startup Robinhood raised $323 million in Series E funding spherical in 2019, bringing its whole funding to $7.6 billion. The fintech, which is a well-liked commission-free stockbroker within the US, not too long ago acquired regulatory approval to increase its providers into the UK. It not too long ago launched a money administration service by serving to customers to earn curiosity on un-invested cash in their account and spend it by way of Robinhood-branded debit card account.

NY-based insurance coverage startup Lemonade raised $300 million in a Series D funding in 2019, taking pictures up its whole funding to $2 billion. GlobalData stated after disrupting the US insurance coverage market utilizing synthetic intelligence and behavioral economics by efficiently focusing on millennials with renters, owners and apartment insurance coverage, the insurtech goals to increase its presence throughout Europe. Moreover, the startup is eyeing to foray into the largely untapped pet insurance coverage market.

“The fintech companies kick-started by unbundling banking services, which threatened the market share of traditional banks. However, now the trend has changed evidently from the fintech startups re-bundling their services as well as expanding into new geographies,” stated Karukula.

He added that such tendencies are anticipated to proceed in 2020 and past given the uncompetitive conventional banks in offering extra unified platforms.

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