French banking and insurance startups have raised €736 million between January and the end of September 2023, the trade association France FinTech and Bpifrance announced this Tuesday, a far cry from the €2.9 billion raised over the whole of 2022 by French fintech companies.
Decrease in amounts raised, increase in bankruptcy filings and low-cost buyouts: the first half of the year proved gloomy for French banking and insurance start-ups, noted the Fintech Observatory.
This is the case, for example, of the young insurance company Luko. After launching a safeguard procedure to facilitate the repayment of its debt, it announced on June 15th its full takeover by the British insurance group Admiral.
The environment is “chaotic”, says a press release issued in conjunction with the publication of the 2023 panorama of French fintech companies, with “strong downward pressure on financing”. This was already at work in the second half of 2022, which accounted for only a quarter of the year’s fundraising.
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One-third of the French fintech companies are profitable
The drop in funding is leading French fintech companies to tighten their belts, and as a result, more of them are achieving profitability: a third of them are profitable, compared with 28% last year. French fintech companies are also making greater use of credit. According to the study, 53% of the French fintech companies have sales in excess of one million euros, compared with 36% in 2022. Nearly a third have international operations.
France Fintech and Bpifrance are also publishing their panorama on Tuesday, listing and classifying some 950 industry players in eight major categories (payment, banking services, insurance, etc.), as part of a thematic week, which began on Monday with a day of exchanges organized at the Banque de France by the AMF and the Autorité de contrôle prudentiel et de résolution (ACPR).
Among fintech trends, France Fintech and Bpifrance note “the rise of segments such as web3 (the term used to describe the revolution in Internet usage), assurtech and impact finance.” as well as “the multiplication of investment platforms” and the rise of artificial intelligence.
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First published in BFM BOURSE. A third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.
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