“[The sector] seems to be buoyant, there is no absence of continued investment and organisations are continuing to try to bring something new to the market,” says Ian Johnson, European managing director at Marqeta, a card and payment provider.
“While there were some delays in programs launching, those delays weren't as significant as they could have been. We've been pleasantly surprised.”
A report by Sage found that financial services and technologies will be the sectors leading recovery, scoring highest in resilience and growth. The report - conducted in June - also found 90 percent of financial services are ‘coping well’ as opposed to the economy-wide rating of 77 percent.
Paul Ford, CEO of Acin, a regtech provider says part of this optimism is coming from the fact that many companies are accelerating their digital transformations.
“The [digitalisation] journey is accelerating. We are seeing organisations that are now investing heavily because of the shift to remote working.”
The trend of working from home and the increasing likelihood that it’s here to stay is providing favourable conditions for the industry, says Ford.
“We're going through budget cycles now in large organisations for a January start. Those investments are now getting tabled, for things that reduce risk and improve digitalisation, tech that would enable the remote new business model of working remotely in a safe and controlled way.
“We see a tailwind from large financial institutions regardless of those various government support schemes coming to an end because this is such a structural shift in the way things are happening.”
Beyond large corporates, SMEs are also looking at technology to help in their recovery, with 80 percent indicating that technology will be important in restarting their business post lockdown. However, a little less than a third said they are actively planning investment.
Newer firms are also finding success despite the more subdued look of the overall economy. Glen Morgan, CEO of Itsettled - a fintech which recently launched an app aimed at helping SMEs with late payment recovery - says coronavirus did not affect their timeline to launch.
“Over time we realised that it was going to be more popular than ever. It didn't change our launch date. We realised in the months leading up to launch that [the app] was going to be more needed than we've ever envisaged before.”
“We're really positive and we're gaining some good traction.”
Given the current market, Johnson says new fintechs should be cautious before going to market.
“New businesses shouldn’t be spending hundreds of thousands in marketing; they should be getting a product out there and seeing what the reaction is. Making sure that they get it right for the current situation before they move on to the next step.
“The fintech industry generally has had a habit of launching a product and then being very fast to launch the next one. I don't see that happening in the future.”