Global fintech revenue $504bn, now 4% of financial services

A report by Boston Consulting Group and FT Partners found global fintechs generated $504 billion in revenue over the past 12 months, representing about 4% of total global financial services revenue. The report covers revenue, profitability, deal activity and technology adoption across the sector.

Fintech revenue rose 22% year-on-year, and 74% of the largest fintech firms reported they were profitable in the period covered. The report described the sector as a distinct part of the financial services industry with remaining room for growth.

Public market activity and mergers and acquisitions increased. Fintech initial public offerings rose 50% to 42 deals in the year. M&A volumes moved from $105 billion in 2023 to $184 billion in 2024 and reached $251 billion last year, the report records.

The authors highlighted a shift in business models. Neobanks and digital-only firms are expanding from payments and onboarding into lending, investing, insurance, cross-border transfers and wealth management aimed at mass-affluent customers. The report frames this change as a move from single-product offerings to broader financial platforms that directly compete with incumbent banks in more product areas.

The report also examined technology adoption. Firms that have embedded artificial intelligence into core operations reported up to five times greater developer productivity. The strongest near-term productivity gains were reported in engineering, underwriting, compliance and customer support. The report linked those gains to redesigning workflows around new tools rather than adopting isolated point solutions.

Deepak Goyal, managing director and senior partner at BCG, called the 4% figure ‘a remarkable milestone for a sector that barely existed two decades ago’ and added that it ‘signals how much of the opportunity still lies ahead.’ Steve McLaughlin, CEO at FT Partners, warned of a growing gap between companies that have embedded AI across finance, accounting, customer service and fraud functions and those that use it in a limited set of workflows. He said that firms investing capital in AI do not automatically achieve breakthrough capability and pointed to management and engineering talent and organisational redesign as differentiators.

The report concludes that regulatory discipline, clear paths to sustained profitability and consistent customer experiences are factors the authors expect will matter for wider adoption and competition as fintech firms scale into more areas of financial services.