When it comes to innovations in the financial sector, most experts are looking towards London, as it is the financial capital of the world. But these experts tend to forget that Fintech innovation can come from any corner of the world, as not all of the development focused in centralized in London itself. In fact, there are at least five major cities that could take the crown from London in terms of Fintech innovation in a few years from now.
FinTech Development Efforts Are Not Centralized
There are only a handful of places on this planet where the financial sector is seeing its biggest growth and largest untapped potential. Silicon Valley, despite being mostly tech-oriented, has played – and will be playing – an integral role in the future development of FinTech applications and platforms.
Despite what financial and technology experts may tell you, there is a lot more development going on in the world of FinTech outside of those two places, though. Neither place is a requirement to create a mainstream FinTech idea and see it come to life after a financial injection from interested parties. For all of the allure both London and Silicon Valley have, they may very well be overshadowed by other parts of the world in a few years from now.
The FinTech revolution is not centralized, but will take on a decentralized aspect, just like Bitcoin has done in recent years. This new business paradigm will allow anyone in the world to contribute to the greater financial good of the entire world. Whether that is with Bitcoin, blockchain technology, or something else entirely, the decentralization revolution is coming.
As a result of the decentralized nature of technological development, FinTech innovations are unique and diverse. Gone are the days where the financial sector was controlled by state institutions, as outstanding technology and ideal infrastructures are being created by people from all over the world.
European Cities Show A Great Interest in FinTech
It should come as no surprise to find out that Europe is warming up to new and disruptive
technological innovation. And the same countries that are embracing Bitcoin more openly are also the countries to drive FinTech innovation to new heights in the near future. All of the European cities with “dark horse potential” are capital cities of their respective countries, for obvious reasons.
Mobile commerce and smartphone usage for payments are seeing unprecedented growth in Spain. Record venture rounds are taking place in the city of Madrid, which is home to various FinTech companies — including Coinffeine and peerTransfer. In fact, the Spanish Association of FinTech Technology (SAFT) was formed in Madrid earlier in 2015.
FinTech startups – just like Bitcoin startups – are facing a hard time navigating the regulatory and legislative requirements in Spain. This is in stark contrast to traditional Spanish banks’ eagerness to adopt new technologies. BBVA, one of Spain’s major banks, was the first to venture into the world of FinTech, which has also led the bank to explore options in the field of Bitcoin and blockchain technology.
A little-known fact is that the DACH region – Germany, Austria and Switzerland – is attracting a lot of FinTech funding in Europe. More particularly, Berlin is often referred to as a “startup capital” – or even “Silicon Allee” – as the city has a unique ability to bolster tech innovation in an efficient and quick manner. On top of that, Germany has a rich financial history, which gives FinTech startups a powerful weapon in their quest to disrupt the banking system as we know it.
Amsterdam is not only one of the Bitcoin capitals of the world, but it is also home to a massive FinTech startup ecosystem. With help and incentives from the Dutch government to create FinTech solutions, startups in Amsterdam have a leg up over other cities in terms of guidance and support. Plus, The Netherlands has a very straightforward tax structure that attracts a ton of international developers and companies.
Australasia Is Making Headway In The FinTech World
Other important parts of the world are Singapore and Sydney, both of which are making a lot of
headway in terms of FinTech innovation. Singapore government is pushing hard to bring financial innovation to the entire world in recent years, and revealed plans to inject US$166m in the growing FinTech ecosystem over the course of five years.
Most people in Asia are unbanked, which creates a lot of opportunities for disruptive financial technologies, like Bitcoin. In fact, Asia is the biggest Bitcoin market to this very date, as it gives people an option to use financial services without needing a bank account or credit card. According to unconfirmed reports, Asians will skip the entire – ATM and credit card generation – and transition to online payments right away.
Sydney, on the other hand, is a new face in the FinTech development race. That being said, there is a huge potential for Australia’s service industries as Sydney becomes a FinTech hotspot in the years to come. Being home to digital, professional and creative industries is a valuable asset to stimulate and bolster financial technology development.
Similar to Singapore, Sydney can count on support from the government in terms of FinTech innovations. Additionally, plenty of private organizations have pledged their support to this sector as well. The Asia-Pacific region is long overdue for financial innovation, and there is no more opportune time than now.
Bitcoin The Driving Factor For FinTech Innovation?
Even though FinTech innovation is not synonymous with Bitcoin in most cases, the underlying blockchain technology could prove to be a powerful ally for developers. WIth this transparent ledger capabilities, and instant transfer of funds from anyone in the world to any place in the world, the potential for this technology has yet to be unlocked.
As more and more companies and developers focus their attention on the FinTech sector, they will undoubtedly come across blockchain implementations at some stage. And as more creative minds attempt to harness that technology for the greater good of all of Earth’s population, it is hard to imagine a world where neither Bitcoin nor the blockchain will play an important role.