The FinTech industry has reached a major inflection point, with a new class of scaled leaders emerging, according to the latest Global Fintech Report by BCG and QED Investors.
The report, now in its third edition, highlights the sector’s return to growth and resilience in 2024, as revenues soared by 21%—significantly outpacing the broader financial services sector, which grew by just 6%.
Drawing insights from over 60 global executives and investors, the report outlines that profitability among public FinTechs surged, with 69% achieving profit compared to less than half a year earlier. EBITDA margins climbed by 25%, driven by a renewed focus on fundamentals and sustainable expansion.
Despite this progress, FinTech penetration still accounts for just 3% of global banking and insurance revenue pools, leaving considerable headroom for further disruption. Currently, fewer than 100 scaled FinTechs—those generating more than $500m in annual revenue—are responsible for about 60% of industry revenue. These players, the report states, will now be expected to behave more like mature public companies.
The report finds that scaled winners are clustered in five verticals: payments, challenger banking, crypto trading, BNPL/POS lending, and vertical SaaS. Payments remains the largest contributor, generating $126bn in revenue in 2024, with digital wallets accounting for $67bn and merchant acquiring/vertical SaaS contributing $50bn. Challenger banks follow at $27bn, while retail crypto and brokerage services generated $16bn. Although still a small segment at $5bn, BNPL and POS lending are scaling rapidly.
BCG and QED highlight several reasons why FinTechs have thrived in certain niches. In areas where banks have been “uncompetitive,” vertical SaaS and modern acquirers have stepped in. Where banks were “unwilling to serve” lower-income consumers, challenger banks and BNPL lenders have found success. And where banks were “unwilling to go,” such as into crypto and digital wallets, FinTechs seized the opportunity.
The report identifies five macro trends that are expected to shape the next chapter for FinTech. These include the rise of agentic AI, which could revolutionise the industry in a similar fashion to the internet or mobile; the growing promise of onchain finance, especially through asset tokenisation; and the continued evolution of challenger banks, which are increasingly targeting affluent customers and expanding their product lines rather than pursuing international expansion.
FinTech lending is also expected to benefit from new tailwinds. While banks maintain a cost advantage through low-rate deposits, FinTechs are leveraging data-rich underwriting models and drawing increasing interest from private credit funds. The report estimates a $280bn opportunity for private credit to flow into FinTech-originated loans.
Future growth is likely to come from B2B(2X) models, financial infrastructure upgrades, and innovation in lending, particularly in business and secured credit. These areas offer fertile ground for emerging players, given the pain points still faced by enterprises in treasury management, accounting, and embedded finance.
BCG and QED also issue a call to action for stakeholders across the ecosystem. Regulators are urged to move faster in areas such as AI and digital assets, harmonising rules across jurisdictions. Investors are encouraged to pursue underpenetrated verticals and regions, while also enforcing fiscal discipline and encouraging AI adoption. FinTechs must stay disciplined on capital allocation, pricing, and compliance, while embedding AI more deeply. Meanwhile, banks are advised to move beyond cautious experimentation with AI, engage meaningfully with FinTech partnerships, and develop robust strategies for digital assets.
QED Investors co-founder and managing partner Nigel Morris said, “We’ve entered a new chapter in FinTech—one that requires mature execution from scaled players and bold innovation from new challengers. The opportunity is vast, but winning it will demand sharper focus and smarter collaboration.”
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