In Italy there are 622 Fintech startups of which 109 are focused oninsurtech. A substantially stable number compared to 2022 (-8), with 24 new births but also an increase in industrial acquisitions and some bankruptcies.
A phenomenon that can be interpreted as a signal of market maturity, as more and more start-ups identify growth opportunities and synergies through collaboration with existing financial or industrial groups.
This was revealed by the research ofFintech & Insurtech Observatory of the School of Management of Politecnico di Milano.
Investments are falling
In 2023, Fintech & Insurtech startups in Italy have raised 174 million euros, by registering a decrease of 81% compared to the previous year, although with a recovery in the final quarter.
The decrease is in line with a global trend of greater caution on the part of Venture Capitalists. 35% of startups have already achieved positive profits, driven by revenues that show a average growth by 60% compared to the previous year.
The sector's outlook is conditioned by need to collaborate with strategic partners and the availability of capital to address the investments required during the scale-up phase, a traditionally problematic aspect in the Italian innovation ecosystem. Less than half of startups existing is preparing for a new round in the coming months, with requests which, in over 80% of cases, do not exceed two million euros.
La International growth remains an obstacle for Italian start-ups, with only 41% aiming to expand beyond national borders, recording a slight worsening compared to the previous year.
Cooperation between Fintech and third parties is growing
The research highlights that the "relationship between fintechs and third parties has become increasingly profitable over time". Marco giorgino, scientific manager ofSYHO, highlights that collaboration between fintechs and third parties has become more profitable, with a reduction in the initial distance in terms of compliance culture and innovation. Start-ups that have developed growth strategies based on cooperation with existing companies have achieved positive results over time.
The use of digital channels is growing
The Polytechnic report recognizes that despite the contribution of start-ups to innovation, the central role of operators larger ones, such as banks and insurance companies, remains in the financial landscape which are increasingly oriented towards digital channels. And i consumers appreciate.
66% use at least one digital channel, while 57% prefer the mobile one. The online transactions increase by 18%, and there is a 7% increase in customers acquired through fully digital onboarding. But, the use of the account aggregation mode offered by the players is less than 0,5%.
As regards bank credit, the majority of consumers (56%) still prefer to go to a branch and interact with an operator, a percentage which increases to 70% for a mortgage.
Il company behavior when it comes to digital financial services it is similar. Only 27% of microbusinesses that can request a loan online have actually taken advantage of this option, and only 23% have activated an online policy. The percentages increase slightly to 36% and 34% for SMEs, which appear to be more structured.
“For an SME – explains Giorgino – completely abandoning traditional operators can be complex, also given the completeness of the solutions proposed. Over the years there has been an acceleration in the digital transformation of the incumbents' offer for businesses, also favored through agreements and partnerships with fintech companies".
1 in 5 Fintechs are thinking about using AI
Theattention towards generative artificial intelligence. The 20% of fintech startups Italian companies are in fact exploring the possibilities of using AI. This represents a significant step in innovation in the digital financial sector, which is facing important transformations related to sustainability, data management and new perspectives such as the revision of the Psdz and the introduction of the digital euro.
Generative AI can play a key role in financial data management. As internal applications are developed to automate processes and improve output quality, artificial intelligence solutions designed to meet customer needs are also emerging, both in the retail and enterprise sectors. These solutions aim to support customers in the decision-making process, facilitating the search for information and improving financial activities.
“Today all operators in the sector are called upon to face interconnected challenges, between the advancement of new technologies such as generative artificial intelligence and the transition towards more sustainable models that are redefining strategies and processes. The Fintech & Insurtech startups, especially in Italy, demonstrate a tension between growing maturity and the difficulties of the macroeconomic context, highlighting the need to build system initiatives. To build the future of Fintech & Insurtech today is essential go beyond buzzwords: concepts such as sustainability, ecosystem and data value must become tangible actions in which they can generate impact. This is also why the Observatory followed and promoted the launch of three projects of fundamental importance for the Italian and European context" he commented Marco giorgino, Scientific director ofFintech & Insurtech Observatory.
