In today’s financial ecosystem, fintech has evolved beyond hype into a cornerstone of global finance. Fueled by innovation and digitization, it now fulfills a frontier infrastructure role in finance—one that emphasizes both profitability and societal impact. This transformation marks a pivotal moment: the question is no longer if fintech can scale, but how it can expand access, empower underserved groups, and drive sustainable prosperity.
Big-picture Context: Fintech and Inclusive Growth
The fintech narrative has shifted in 2025 from rapid expansion to a more measured, sustainable trajectory. Stakeholders increasingly prioritize profitability and impact over growth, recognizing that long-term success hinges on balancing revenue with real-world benefits. A landmark global survey by the Cambridge Centre for Alternative Finance and the World Economic Forum, covering 240 fintechs across six regions, concludes that these firms are cementing their role as engines of inclusion.
In policy forums like the G20, IMF, and World Bank, fintech is championed as a lever for financial inclusion and inclusive growth, poverty reduction, and shared prosperity. Yet, the spotlight also illuminates emerging risks and regulatory challenges. As fintech integrates with mainstream finance, regulators grapple with new frameworks, risk management protocols, and cross-border coordination to ensure stability without stifling innovation.
Market Size, Growth and Sector Structure
The global fintech industry is on track for a compound annual growth rate of about 23.6%, aiming for a market size near USD 895 billion by 2028. Recent reports by BCG show fintech revenues jumped 21% year-over-year in 2025, starkly outpacing the broader financial sector’s 6% growth.
Customer growth has moderated to 37%, down from a frenzied 55% pace previously, signaling a shift from blitzscaling to sustainable momentum. Revenue and profit growth, however, remain robust at 40% and 39% respectively, underscoring a maturing industry that behaves more like core financial infrastructure—nimble yet resilient.
Key retail-facing verticals identified in the 2025 WEF/CCAF survey include:
- Digital lending
- Digital capital raising
- Digital payments
- Digital banking and savings
- Insurtech
- Wealthtech
Inclusion Impact: Reaching the Underserved
Fintech’s greatest promise lies in its ability to extend services to those left behind by traditional finance. According to the 2025 WEF/CCAF survey:
• 57% of fintechs count MSMEs as a significant customer segment, bringing credit and liquidity to enterprises once deemed too small or risky.
• 47% report low-income individuals as core users, signaling meaningful uptake of mobile wallets and digital savings platforms.
• 41% highlight women as a key demographic, reflecting efforts to narrow persistent gender gaps in account ownership and financial literacy.
Data from the IMF’s Financial Access Survey corroborates these trends: fintech lending reached USD 350 billion in Buy Now, Pay Later transactions and USD 62 billion in peer-to-peer lending in 2024. In Sub-Saharan Africa alone, funding targeting micro and small enterprises soared from 13% to 88% between 2020 and 2023.
The World Bank projects that fintech could bring 1.7 billion unbanked adults into the financial fold by 2030, primarily via mobile phones. This “from cash to code” revolution is unlocking opportunities in payments, credit, insurance, and investments for communities previously reliant on informal systems.
Mechanisms Enabling Inclusive Growth
How does fintech translate innovation into real-world inclusion? Core mechanisms include:
- Digital payments and mobile money networks
- Alternative data and AI-driven credit scoring
- Embedded finance within platforms
- Collaborative partnerships with incumbents
Digital payments serve as the gateway to formal finance. Mobile wallets reduce remittance costs, enable social benefit distribution, and provide merchants with QR code acceptance—granting previously informal businesses cash-flow visibility and recordkeeping tools.
Fintech lenders use alternative data and AI-driven credit models, analyzing real-time payment behavior, rental history, and e-commerce sales data. This approach mitigates information asymmetries and extends credit to gig workers and SMEs lacking traditional collateral.
Embedded finance injects lending and insurance directly into accounting software, gig platforms, and B2B marketplaces. Such embedded loans and integrated insurance services streamline access to capital and protection, reducing friction and administrative barriers.
Partnerships between fintechs and traditional banks—through API integrations, white-label products, and data-sharing agreements—constitute a new paradigm of collaborative inclusion. By combining innovation with established infrastructure, these alliances scale more efficiently while maintaining regulatory compliance.
Policy, Regulation and Macro Conditions
Regulatory environments have become more fintech-friendly, with 62% of firms citing adequate frameworks and 35% applauding strong clarity. Nonetheless, fintechs call for improved coordination, capacity building, and streamlined licensing processes.
Central banks in many emerging markets now track agents, mobile accounts, and e-money as core financial access metrics. Regulators are also adopting fintech-specific reporting standards, balancing consumer protection with the need to foster innovation. Cross-border data flows and digital identity initiatives remain top priorities in macroeconomic policy discussions.
Future Directions and Emerging Risks
As fintech cements its role, challenges loom: data privacy concerns, cyber threats, and algorithmic bias in credit decisions. Policymakers must guard against financial fragmentation while promoting open banking standards and robust cybersecurity frameworks.
Looking ahead, fintech is poised to explore digital currencies, real-time cross-border settlements, and decentralized finance. The frontier will involve harmonizing global standards, fostering digital literacy, and ensuring that technological gains do not widen existing inequalities.
Conclusion: Charting a Path Forward
Fintech at its best is more than a technological novelty—it is a force for inclusion, transforming lives by broadening access to essential financial tools. By focusing on profitability and impact over growth, leveraging alternative data responsibly, and forging strategic partnerships, the sector can deliver on its promise of shared prosperity.
The road ahead demands collaboration among innovators, regulators, and communities. Only through collective commitment can fintech pave a truly inclusive path, ensuring that every individual and enterprise benefits from the digital financial revolution.
