Although there was a slight slowdown in the Swiss fintech scene last year, there is still much to celebrate.
In 2021, the number of fintech companies in Switzerland declined for the first time in six years, yet the volume of business increased, according to an industry study by Lucerne University of Applied Sciences and Arts (HSLU)
At year-end Switzerland was home to 384 fintechs, down by 21 companies in 2020. Since 2015, the number of companies in the sector had grown steadily year on year, with a real boom from 2017 to 2018 when numbers jumped from 220 to 356 firms.
Despite the decline, the report highlights positive trends such as the increase in employees working at fintech companies and the total amount of funding received by firms.
Venture capital activity in the Swiss fintech sector reached record levels, while the number of financing rounds increased to 87 from 61 in the previous year. Volume also rose significantly to 446 million Swiss francs from 259 million Swiss francs the year before.Thematically, analytics, artificial intelligence and big data are in the lead, with analytics seen as an area, which will continue to grow.
The potential of using data in the financial sector is increasingly being recognized, but not yet fully exploited, Thomas Ankenbrand, lecturer and project leader at the university said.
The number of companies focusing on B2B, i.e., business customers, has also increased, while companies are predominantly internationally oriented, he said. «The low-growth Swiss home market is often too small for fintech companies hungry for growth, Ankenbrand said.
Open finance is also an important area: «Especially in the area of wealth management, open finance offers good opportunities for success,» he said, pointing to the global market size and Swiss market share.
Financial ecosystems as a future business model will require the widespread adoption of common standards, something that banks and fintechs are still struggling with, he said.