Singapore Fintech Market - Growth, Trends, Covid-19 Impact and Forecast(2022 - 2027)

Singapore Fintech Market - Growth, Trends, Covid-19 Impact and Forecast(2022 - 2027)

The negative social situation that has nevertheless benefitted many FinTechs in terms of adoption leads to the growth of FinTechs hence, expected to accelerate as a result of the digital transformation brought about by the COVID-19 pandemic. While the COVID-19 pandemic has resulted in a fall in overall FinTech funding in Asia (particularly in China and India), the funding landscape in Singapore has been less volatile. Despite an initial decline in funding, Singapore’s FinTech investments rebounded in the second quarter of 2020, with investors recognising the opportunities existing in Southeast Asia. This support for FinTechs in Singapore stands in contrast to other markets in the region, where many FinTechs, especially early-stage businesses, have struggled to cope with the impacts of the pandemic. COVID-19 has also accelerated the pace of digital adoption, further benefitting FinTechs. In fact, in some sub-sectors of the economy, the pandemic has had a positive impact on business performance, particularly for businesses not exposed to credit risk, such as those involved in the facilitation of payments, wealth management, and insurance.

Singapore as a FinTech hub for both investors and entrepreneurs is unrivalled in Southeast Asia. Singapore has the right ingredients: regulatory support, talent, tax treaties, ownership, and share structures, and it’s politically friendly standing in the region makes it a good petri dish for innovation and expansion into other markets.

During the first FinTech wave, the majority of entrepreneurial activity and funding was centred on the facilitation of payments and lending, so as to improve financial inclusion in the Southeast Asian region. As the payments and lending space matures, new sub-sectors are emerging. New entrants to the FinTech sector have shifted gears and are exploring white spaces in Wealth Management, Capital Markets, InsurTech, RegTech, and Data Analytics. This development has given rise to a vibrant FinTech landscape.

Key Market TrendsBlockchain Driving Singapore Fintech Market

One fintech vertical that has risen to prominence in Singapore is blockchain and cryptocurrency, which now dominates the local fintech scene. Out of the 430 fintech startups identified in FY2020 in Singapore, 19% operate in the blockchain and cryptocurrency vertical, making it the biggest segment, ahead of payments (16%), investments and wealthtech (14%), and regtech (11%).In 2020, the huge investment in SIngapore's Blockchain through Singapore Blockchain Innovation Program aims to accelerate the development and adoption of the technology, and will engage close to 75 companies to conceptualize 17 blockchain projects forecatsed operations within the sectors starting with trade and logistics, and supply chain in forecast period.

Cross-Border Access to Customers and Partners

Singapore is well-positioned to be a regional FinTech hub, as it provides access to a wide pool of customers in Southeast Asia and an extensive network of partners that have their regional headquarters in Singapore. This environment facilitates collaborations between financial institutions and FinTechs, and in turn helps accelerate product-market fits for new innovations. With the help of cross-regional alliances, such as FinTech bridges, B2B FinTechs would also be able to achieve scale and expand to neighbouring markets with greater ease.

Competitive Landscape

The Singapore Fintech Market is highly competitive and fragmanted as Singapore has been proven as the largest market of Fintech Industry throughout Asia. The Singapore FinTech ecosystem is developing faster and faster each year, with more and more companies and incumbents seeking new opportunities to collaborate, connect and co-create that cater to numerous clients and cover a broad range of services such as digital payments, alternative finance, wealth management and blockchain, among others. Singapore groups such as Bambu, Matchmove, MoneySmart, TrackInvest have been focusing on innovating FinTech industry and leading the Singapore Fintech Market to the new heights.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

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