As the COVID-19 pandemic continues to create uncertainty, many fintech companies (“fintechs”) are under stress on a number of fronts. Access to funding was already becoming difficult, especially for some early-stage ventures, as many investors focused on established fintechs with clear business models. In addition, recent interest rate cuts and the economic slowdown have radically changed many industry assumptions.
Yet as the broader economy shifts from respond to recover, COVID-19 may create new opportunities for some fintechs. For example, as social distancing has taken hold worldwide, there has been tremendous growth in the use of digital financial services and e-commerce.
