To Reach Fintech’s Next Level, Infrastructure Providers Must Address Key Pain Points
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The Fintech Industry: Opportunities Amidst Challenges
The fintech industry has faced significant challenges in recent times. Despite these difficulties, there are still opportunities for growth and innovation.
Fintech’s Struggles
The past few months have seen a decline in the number of fintech startups raising funds. According to recent data, venture capitalists invested $75 billion in Q4, but it remains difficult for startups to secure funding. Additionally, failed fintech startup Bench accumulated over $65 million in debt before shutting down.
Opportunities for Infrastructure Providers
However, infrastructure providers can benefit from the current situation. By addressing the pain points of their customers and providing efficient solutions, they can position themselves as a more attractive option than building in-house solutions.
Key Trends and Opportunities
- Embedded Fintech: With the rise of fintech in various industries such as restaurant software, travel applications, and trucking, infrastructure providers have an opportunity to attach themselves to growth areas outside the fintech industry alone.
- Conversion Matters: Conversion rates are crucial for fintech startups, especially during this downturn. Infrastructure providers can help improve conversion rates by enabling seamless onboarding experiences for end customers.
- Buy vs. Build: Fintech companies may be forced to make difficult hiring choices, which can strain resources in the short term. This shift gives infrastructure providers an opportunity to position themselves as a more efficient ‘buy’ option.
Specialization and Growth
To capitalize on these opportunities, infrastructure providers must specialize in addressing the pain points of their customers. By doing so, they can become assets to any market they serve.
Conclusion
The fintech industry may be struggling, but there are still opportunities for growth and innovation. Infrastructure providers can benefit from the current situation by providing efficient solutions and attaching themselves to growth areas outside the fintech industry alone.
