Nine Israeli companies were among KPMG's 100 most promising fintech companies for 2016, compared with eight in 2015. Two Israeli companies Payoneer and Ourcrowd were rated among the 50 leading established companies, while seven were listed among the emerging fintech stars of tomorrow.
Payoneer, which deals in the transfer of payments between businesses from different countries, recently completed a $180 million financing round (half in an offer for sale by existing shareholders). Founded 11 years ago, the company's annual revenue exceeds $100 million. Ourcrowd is actually a crowdfunding platform used mainly by startups in Israel and elsewhere.
The seven Israeli companies listed as emerging fintech stars include Tipranks, an aggregator for capital market analysis used to devise investment strategies and in analyst ratings. This platform is also included in the systems of Bank Hapoalim (TASE: POLI) and Bank Leumi (TASE: LUMI).
Other companies on the list include Lemonade, which is active in P2P - not in loans, but in insurance - and Innovative Assessments, which offers underwriting tools (mainly for loans) through the use of a psycho-technical questionnaire.
Israel is also represented in the payments sector by Paykey, which offers a keyboard for mobile devices that can be used as an interface with a bank and for making payments, and by Zooz, which streamlines the digital payment process for businesses. Israeli company Blackswan, which appears in the big data segment, uses big data to generate business intelligence, and DMway uses big data to predict various trends.
"This is the second straight year in which Israel has proved that it is world-class incubator for fintech companies," says KPMG Israel Financial Services practice head Eileen Toledano. "As in the global picture, the focus in Israel is on payments and loans," says KPMG Israel Manager & Fintech Leader Miri Zaretsky. She added, "This year, we're seeing new segments gaining momentum in the rating, headed by regulation, with nine companies on the global list, compared with none last year, given the growing trend among financial institutions to try to find ways to ease the regulatory burden."
KPMG composed its list with the help of H2 Ventures, based on various parameters, including total money raised by the company, the adoption rate for its developments, etc. The rating figures show that Chinese and Australian fintech are continuing their domination, with an impressive presence in the global rating, and that insurance fintech has doubled its presence in the ratings. At the same time, loans and payments are still the leading fields on the list, with 28 loans companies and 22 payments companies, accounting for half the companies on the ratings list.
The fintech sector (technology companies providing financial services) began in the preceding decade, but has made strides only in the past three years. It is projected to have a dramatic and disruptive effect on the entire financial sector in the coming years.
KPMG data show that the global fintech industry is experiencing a decline in venture capital investments, with a total of $9.4 billion being raised in the second quarter. On the other hand, 2016 is expected to be a peak year in capital raising in this industry. Israel is regarded as a significant fintech incubator, with 450 companies active in the field.
Published by Globes [online], Israel business news - www.globes-online.com - on October 27, 2016
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