Fintech investment is booming. In 2018, a record USD 111.8 billion1 was invested in fintech, and the sector garnered extensive media coverage and interest. But despite fintech’s growing profile—and even though it can help unlock trillions of dollars in value by reaching financially underserved households and businesses—fintech solutions have yet to reach the majority of the financially excluded.
It is against this backdrop that we at MIX worked with MetLife Foundation, Visa Inc., Accion, and IFC to launch the Inclusive Fintech 50, the first global effort to spotlight earlystage fintechs driving financial inclusion. Over a six-week period during February-March 2019, 576 companies applied through a publicly available 32-question online form that gathered data related to target market, customers, financials, product details, and more.
Based on eligibility criteria described in the application, 400 fintechs, headquartered in 72 countries and operating in 148, were deemed eligible. With product and service offerings ranging from alternative credit scoring to blockchain-based remittances, the applicants demonstrate the impressive diversity, and significant opportunity, of fintech for financial inclusion.
Four key findings emerged from our analysis of applicant data. We believe these findings can help funders, investors, and fintechs in their financial inclusion efforts:
1. Funding is concentrated in several notable ways.
2. Measuring inclusivity is highly contextual.
3. “Innovation” is not limited to technology.
4. Common definitions and standards are needed to bring clarity to the diverse field.
The Inclusive Fintech 50 applicant pool provides new insights into inclusion-focused fintech, itself a subset of the fintech universe. Early-stage inclusive fintechs are developing innovative products, services, business models, and distribution channels to provide solutions for underserved segments. Yet these startups require capital and other resources in order to reach the world’s 3 billion financially underserved people. By highlighting these high-potential companies, we hope to support the efforts of investors, banking partners, and other fintechs working towards a financially inclusive world.
Above text included in the Executive Summary.