The general trend of integrating fintech into the global economy has been particularly noticeable this year with the health crisis. For the France FinTech association’s barometer, this was an opportunity to look back on a very singular year.
Over the last twelve months, the challenges of the first quarter did not evolve in the same environment as the rest of the year. Fintech took advantage of the crisis to speed up its arrival, and introduce tools and habits that might have taken us at least five years to integrate into a transition without a break point.
Nevertheless, France was not starting from as far away as some other countries. As we mentioned last week, the French are particularly attached to cash, but are among the first to pay by card. The digitization of payments and financial products is already far behind us, and the rate of bankers is particularly high compared to countries such as the United States.
This situation has prompted French fintech companies to attract investors, and not only French ones. French people have adopted mobile payments, neo-banking (for both professionals and individuals), and new, simpler, 100% online insurance services.
Read more about the French fintech sector and how fintech companies developed during the pandemic, with the Born2invest mobile app/ Our companion app brings you the latest economic news in the world so you can stay on top of the market.
The fintech sector: the 2020 balance sheet
The annual report of the French fintechs association showed that the digital finance industry as a whole accounted for 15% of fundraising for digital companies this year. An annual performance, with $1 billion (€828.2 million) raised, according to the France FinTech report, driven by transactions averaging $16 million (€13.1 million), up 20.6%.
With this investor appetite, the new banks were particularly active this year, with a 31% share of fundraising. Payment services such as Lydia represent 15.3%, and insurtech companies are now moving up to 20% to establish their best year ever.
The French FinTech sector did not forget the challenges during the year, especially between March and April when the uncertain future put most financing projects on hold. Doubts mainly concerned the neo-banks, still very young and dependent on the use of customer cards to generate money, as well as open borders to interest the first public of these 100% online models.
Since the health crisis, the investors’ eyes were even more interested than before for some fintech companies, and the explanation is the same as with outbreaks like Zoom on the stock market: digital tools have been adopted all the more. In an interview, the founder of the eFounders startup studio said on this subject :
“Since May, I no longer find any correlation between what we experience in our personal lives about health rules, the economic crisis, what we read in the newspapers and what happens in fundraising. We are back, honestly, to the pre-COVID situation.” All this could not have found a better comparison than the amount of money raised in December: $173 million (€143 million).
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First published in PRESSECITRON, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.
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