Industry

IDC’s Analysis and Announcement of the 2020 FinTech Rankings and Real Results Winners

Learn about the process of cultivating the annually anticipated list of the largest financial technology players worldwide, IDC's 2020 FinTech Rankings.
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Join us for the Impact and Trends of FinTechs on Financial Services and Analysis of IDC FinTech Rankings and Real Results Winners webinar on October 13th at 11 AM/EST for our virtual announcement of IDC’s 2020 Fintech Rankings.

How Does a FinTech Land in the IDC FinTech Rankings?

IDC’s 2020 FinTech Rankings is a list of the largest financial technology players worldwide, who have reinforced several themes that have become ever more prominent in 2020. First, the ideals of stability, evidenced by how many long-standing FinTechs continue to feature well in our list. These vendors provide a sense of normalcy amid the turbulent year in financial services. They have reported additional revenues as some banks and insurance clients prefer the “old guard.”

This echoes the curious flight to quality trend seen in the struggle new challenger financial institutions to gain more market share versus incumbents. Related to this is the ideal of business resiliency. Financial technology players have focused on reliability and availability of services – any downtime or failure of an application or a system is an affront to customers in a heightened state of concern about the very viability of their businesses. Cloud offerings as well as additional investments in uptime and security prove that there is such a race to resiliency of services.

Among the vendors that offer core banking or core insurance applications, we see that there has been no interruption in their multi-year course for core transformation. At IDC Financial Insights, we have been talking about “core abstraction” a well-considered approach taken by many leading banks of disaggregating monolithic core system structures and abstracting business logic typically buried deep in those systems into external components. An abstraction layer is built on a foundational layer that is the bank’s or the insurer’s a stable and powerful system of record. The next layers, those that are abstracted from the core are made up of shared resources– products, services, partners, or channels – that are configurable. Microservices is the ultimate model and level of abstraction of these business services from the core.

Fortuitously, many vendors had already brought a high level of abstraction to their products before the emergence of Covid-19, and they are just in the middle of bringing these new propositions to the market. Vendors moving forward are seen to commit to the promise of cloud and cloud technologies and transform their core system to be as cloud-native as possible.  

The Pandemic Played a Unique Role in the 2020 FinTech Rankings

Many of our vendors this year have come up with solutions fit for the unique challenges of 2020 – although since they have only been launched recently, they might not have contributed a lot to revenues. However, there are at least 40 solution areas that have, in a sense, been given COVID-19 context. These 40 solution areas show how financial services worldwide are coming up with an all-encompassing response to the crisis. We note solutions in three areas:

  • Analytics to give financial institutions insight into new market dynamics, so that they can craft an effective response, seen in the rise of capabilities for stress testing, asset-liability management, and operational risk (including security)
  • APIs and API management to manage the flow of the organization’s functionality, applications, and data to trusted third parties in the spirit of open banking
  • Capabilities to support new modalities of customer engagement in traditional and virtual channels, which include new concepts such as pre-staged transactions, advisory-led interactions, and consent-driven engagements

The Virtual Announcement of IDC’s 2020 FinTech Rankings

For the first time, we will be virtually announcing the winners of the 2020 FinTech Rankings and Real Results winners in our upcoming webinar, Impact and Trends of FinTechs on Financial Services and Analysis of IDC FinTech Rankings and Real Results Winners on October 13th at 11 AM/EST. During the webinar, IDC Financial Insights will also provide an overview of the FinTech industry trends and the impact this is having on overall IT spend.

Michael Araneta

Associate Vice President, IDC Financial Insights