Global Automotive Fintech Market Size, Share & Industry Trends Analysis Report By Channel, By Vehicle Type (Passenger Car, and Commercial Vehicle), By Propulsion Type (ICE, and Electric), By End User, By Regional Outlook and Forecast, 2022 - 2028

Global Automotive Fintech Market Size, Share & Industry Trends Analysis Report By Channel, By Vehicle Type (Passenger Car, and Commercial Vehicle), By Propulsion Type (ICE, and Electric), By End User, By Regional Outlook and Forecast, 2022 - 2028

The Global Automotive Fintech Market size is expected to reach $82.6 billion by 2028, rising at a market growth of 9.0% CAGR during the forecast period.

A subset of financial technology called "automotive fintech" caters to the need for digital financial services in the auto sector. Digital insurance, car payments, digital leasing, and other services are all part of the automotive fintech industry. Automotive fintech companies streamline and automate financial processes to simplify buying and running automobiles for customers and businesses. These technologies include machine learning, data analytics, and blockchain.

Automotive fintech includes equipment for managing and owning vehicles and purchasing and financing them. For instance, smartphone applications let users check their vehicle's health and get alerts when repairs are due. Other systems enable customers to hire automobiles for brief periods without going to a rental car office. These systems provide on-demand automobile sharing and rental services.

Most dealerships and car loan financing organizations know that change is necessary and that they must start implementing cutting-edge end-to-end pricing technologies, such as digital loans and purchases. Fortunately, recent developments in cloud and digital technology have made innovations and trends in vehicle finance possible. Auto dealers can now ultimately oversee every element of their lending program due to the sophisticated end-to-end lending software, which integrates cutting-edge technologies like machine learning, advanced data analytics, and artificial intelligence. The usage of such technologies would accelerate market growth.

COVID-19 Impact Analysis

The variety of products available, and convenience, in 2020–21, pandemic-related reactions and containment measures will raise the relevance of these elements. Fintech companies, big tech companies, and established financial institutions are adjusting quickly to a new business environment. The usage of digital payments and modifications in the buying and selling habits of retail consumers and vendors were two developments accelerated by COVID-19 and thereby propelled the market growth despite the initial restriction to the market growth due to the decline in automotive industry.

Market Growth Factors

Cooperation between cab companies and fintech firms

The on-demand provision of transportation services to customers through automobiles, taxis, or ride-hailing services is the business of the cab rental industry. With the development of technology and smartphone applications, the industry has seen remarkable growth, making it more straightforward for customers to schedule a trip and track their cars in real-time. Cab companies offer many services, including hourly rentals, point-to-point trips, and airport shuttle services. The collaboration between cab firms and fintech companies for mutual benefits is expected to drive market growth.

Automotive industry's digitalization

The digitization of supply chains is fueled by the continuously growing desire for industries to be more responsible and sustainable globally. Technologies like blockchain and smart contracts will be used to accomplish this objective of traceability and transparency further. The increasing digitalization of the automotive sector provides different growth opportunities for automotive fintech firms to provide better financial services to the consumers and thereby surge market growth.

Market Restraining Factors

Concerns regarding security and privacy of the fintech firms

One-time passwords and other forms of authentication are used by fintech businesses to protect the payment system, but hackers can still access these systems, stealing financial and personal data. While cyberattacks get more sophisticated every day and establishing total security in the digital realm is quite a challenge, financial organizations have always been in danger of data leaks. Yet hackers often use these third-party programs as a point of entry. They allow hackers to pretend to be authorized users to get access without authorization, compromising data security. Data security risk with the fintech firms is anticipated to restrict the market growth.

End Use Outlook

Based on end-use, the automotive fintech market is segmented into in vehicle payments, online leasing, digital loans & purchase and online insurance. The online leasing segment acquired a significant revenue share in the automotive fintech market in 2021. This is due to the fact that online methods reduce the time it takes to hire a vehicle and the expense of paying personnel to enter data into paper-based records. Also, by removing needless trips back to the office for information or paperwork, these technologies enable rental car firms to monitor cars more effectively and save on costs.

Channel Outlook

On the basis of channel, the automotive fintech market is divided into on demand and subscription. The on-demand segment held the highest revenue share in the automotive fintech market in 2021. The growth is owing to the fact that with on-demand services, one only pays for what they use. The user gets a custom solution that allows them to function effectively. Moreover, on-demand services guarantee that one may expand the services as and when needed. This is simple to do without spending money on new gear.

Vehicle Type Outlook

By vehicle type, the automotive fintech market is classified into passenger car and commercial vehicle. The commercial vehicle segment garnered a prominent revenue share in the automotive fintech market in 2021. This is owing to the fast development of population and urbanization, growing infrastructures, and expansion in the industrial sector. The industrial sector is increasing in emerging nations, creating opportunities in various industries, including building, mining, and tourism. Due to the rise in commuters brought on by the employment situation, there is a significant demand for public transportation.

Propulsion Type Outlook

Based on the propulsion type, the automotive fintech market is bifurcated into ICE and electric. The ICE segment recorded a significant revenue share in the automotive fintech market in 2021. This is due to the fact that an ICE car delivers higher engine power than the average electric vehicle and is often less costly than an electric or hybrid electric vehicle. Traditional, oil-derived fuels like gasoline or diesel propel a car with an internal combustion engine, and have a minimal fueling time which is the reason behind the high preference of these vehicles.

Regional Outlook

Region-wise, the automotive fintech market is analyzed across North America, Europe, Asia Pacific, and LAMEA. The North America region held the highest revenue share in the automotive fintech market in 2021. This is because the automotive sector has advanced remarkably in the region. This is owing to availability of a large number of automotive fintech service providers in the region. There is a robust support by the government towards the sales of EV vehicles and giving financial aid to the auto financing. The rising awareness regarding the environmental conservation which is further fueling the demand for EVs providing more growth opportunities for the automotive fintech market.

The market research report covers the analysis of key stake holders of the market. Key companies profiled in the report include Kuwy Technology Services Pvt Ltd. (Volkswagen Financial Services AG) (Volkswagen AG), Creditas Soluções Financeiras Ltda., Euroclear SA/NV (Euroclear Holding SA/NV), Grab Holdings Inc, Blinker Inc., The Savings Group, Inc. (Autopay), Cuvva Limited, RouteOne LLC, By Miles, and AutoFi, Inc.

Strategies Deployed in Automotive Fintech Market

Dec-2022: Euroclear entered into an agreement to acquire FinTech Goji, a private markets technology and services developer. The acquisition would allow the company to offer its clients a one-stop shop offering across a spectrum of products including ETFs and private funds and mutual and alternative funds.

Aug-2022: Blinker joined hands with Flagship Credit Acceptance to leverage Flagship's resources to accumulate more shares within auto financing. Through this partnership, the company aimed to deploy its proprietary loan origination solutions with a trusted partner.

Aug-2022: RouteOne came into collaboration with Paays, a Canadian FinTech startup focused on creating digital finance solutions. The company would integrate Paays ID Verifier into the RouteOne platform to enable automotive dealerships to fight fraudulent loan activities. The integration enables the digital transmission of customer identity information between dealers, consumers, and finance sources through the RouteOne Credit Application System.

Apr-2022: By Miles revealed its By Miles Connect platform, the would allow drivers of connected cars to connect their insurance policy to the company directly from their car. The platform allows the company to take information directly from the vehicles, via the cloud, and utilize information about the distance driven to price insurance.

Feb-2022: Kuwy unveiled Lending-as-a-Service (LaaS) platform for online car sellers. The new platform would enable car manufacturers (OEMs), dealers, aggregator platforms, and lenders to provide digital retailing to customers. The new Lending-as-a-Service (LaaS) platform focuses on point of search, which includes websites of dealers, OEMs, car marketplace, and aggregators.

Sep-2021: Creditas announced its partnership with Nubank, a Brazilian fintech bank. to provide its products to Nubank customers in Brazil. The partnership would enable the company to allow Nubank customers to change their cars or renovate their homes.

Jul-2021: Creditas acquired Minuto Seguros, Brazil’s largest digital insurance brokerage. The acquisition of Minuto would enable the company to offer its customers a digital platform for selling, trading, finance, their car.

Feb-2021: By Miles came into partnership with WNS Assistance, providers of end-to-end claims management solutions. The partnership is aimed at managing claims by using the real-time data of the vehicle for a first-of-its-kind connected car insurance policy using the real-time data of the vehicle.

Jan-2021: AutoFi expanded its business by launching a new division lending as a service. The new division would allow the finance and purchasing of a car entirely online.

Jun-2020: RouteOne collaborated with Carzato, an automotive online services provider, to improve the experience for consumers and dealers in North America. The integration of Carzato with RouteOne would help the company to solve current market challenges and support the Online Retailing Experience launch that provides quality leads from dealer digital retail platforms and OEM.

Oct-2019: RouteOne formed a partnership with LendingTree, Inc., a leading online loan marketplace, to enhance the procedure of car purchasing for consumers, car dealers, and indirect auto financing sources alike.

Jan-2018: AutoFi formed a partnership with JPMorgan Chase, an American multinational financial services company. The partnership would enable the company to offer a digital retailing solution to dealers across the nation.

Scope of the Study

Market Segments covered in the Report:

By Channel

• On Demand
• Subscription

By Vehicle Type

• Passenger Car
• Commercial Vehicle

By Propulsion Type

• ICE
• Electric

By End User

• Digital Loans & Purchase
• Online Leasing
• Online Insurance
• In-Vehicle Payments

By Geography

• North America
• US
• Canada
• Mexico
• Rest of North America
• Europe
• Germany
• UK
• France
• Russia
• Spain
• Italy
• Rest of Europe
• Asia Pacific
• China
• Japan
• India
• South Korea
• Singapore
• Malaysia
• Rest of Asia Pacific
• LAMEA
• Brazil
• Argentina
• UAE
• Saudi Arabia
• South Africa
• Nigeria
• Rest of LAMEA

Companies Profiled

• Kuwy Technology Services Pvt Ltd. (Volkswagen Financial Services AG) (Volkswagen AG)
• Creditas Soluções Financeiras Ltda.
• Euroclear SA/NV (Euroclear Holding SA/NV)
• Grab Holdings Inc
• Blinker Inc.
• The Savings Group, Inc. (Autopay)
• Cuvva Limited
• RouteOne LLC
• By Miles
• AutoFi, Inc.

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