Though still relatively new themselves, the world’s top fintech labs are helping startups, banks and governments devise fresh solutions and uncover untapped opportunities.
This era of unprecedented technological advancement presents financial institutions with both opportunities and challenges. For every application programming interface (API) that helps banks more efficiently process business-to-business (B2B) payments, a cloud-based disruptor offers point solutions for lending, eating into bank profits. Easier cross-border payment systems enable faster business but increase security risks. Analytics coupled with big data help banks coalesce client information into a single customer view, but that view may run afoul of EU General Data Protection Regulation (GDPR) mandates.
Not surprisingly, organizations turn to financial technology—fintech—to meet the challenges posed by digitization and to help capture the significant opportunities it presents. This year, Global Finance set out to identify the technology labs—or hubs, or incubators, or accelerators—that are setting the pace when it comes to nurturing innovation in finance. We cast a wide net, putting a call out to our global network of reporters and sources for informal nominations. We then vetted our initial list to weed out mere co-working spaces—our honorees had to demonstrate an active program of startup support and a focus on fintech. Most fintech labs are relatively young, launched within the past five years, so we further narrowed the list to labs with some track record of successful startup “graduates.” Then we dove even more deeply, considering metrics such as the strength of each hub’s ecosystem of partners and supporters and the extent to which it provides funding or access to funders.