Global fintech and funding innovation ecosystem

Cambridge Centre for Alternative Finance Publishes Americas Report: Sector Grows by 26% as US Market Leads with 97% of Market Share

Crowdfund Insider | By | Dec 20, 2018

reaching new heights 3rd altfi amercias report - Cambridge Centre for Alternative Finance Publishes Americas Report: Sector Grows by 26% as US Market Leads with 97% of Market ShareThe Cambridge Centre for Alternative Finance (CCAF) has published their annual report on alternative finance covering the Americas. According to Reaching New Heights: the 3rd Americas Alternative Finance Industry Report covering data for 2017, across the Americas alternative finance grew by 26% to reach $44.3 billion in 2017. The bulk of this amount was driven by the US accounting for 97% of the Americas market and $42.81 billion.

For this years report, 35 countries in the Americas were surveyed. This included survey submission from 234 unique platforms. In addition, external data was collated from 47 platforms. This represents an increase of 134% in platform coverage for the year.

Robert Wardrop, Director of CCAF, said this year’s report illustrates the uneven yet considerable growth of online alternative finance in many countries across North, Central and South America.

So how does this compare to the previous report, even with the change in platform coverage?

In 2016, CCAF reported $35.2 billion for the year. The growth rate was approximately 23% from the prior year. Throughout the last five years (2013-2017) the average annual growth stands at 89%. Total volume over the last five years amounted to $124.5 billion. Of this amount, 35% came in 2017 alone.

For the US, Consumer Lending was the key driver in the market. Balance Sheet Consumer Lending accounted for $15.2 billion (35.5% of market share) and Marketplace/P2P Consumer Lending accounting for $14.7 billion (34.3% of market share).

Canada, the second largest market, generated $868 million – a respectable amount for a country with a population that is a fraction of the US. The balance between Latin America and the Caribbean was $663 million.

The report notes that Canada saw considerable growth, up by 159% from $335 million in 2016 to $868 million in 2017. The Canadian alternative finance market was driven primarily by alternative business funding, which accounted for 61% of the total.

LATAM and the Caribbean grew by 94% from $342 million in 2016 to $663 million in 2017.

Brazil, Mexico, and Chile drove 78% of the region’s growth, with Brazil jumping ahead of Mexico and Chile to become the region’s market leader.

Not including the US, SME business financing was the clear market driver.

According to the report, 85% (or $566 million) of all alternative finance volumes across the region came from business financing. CCAF states this is particularly pronounced in Chile, where alternative business funding accounted for 27% of the overall Latin America / Caribbean (LAC) business funding market.

See:  While Canada debates, others are commercializing our most valuable asset: data

Diego Herrera, Financial Markets Lead Specialist for the Inter-American Development Bank (IDB), said that many regulators in the region use the series of studies that the University of Cambridge has published with the IDB support to design their policies and regulations.

“In fact, many of the jurisdictions have understood the size of their Alternative Finance ecosystem with this reliable source of data,” said Herrera. “Regulation has become one of the most important drivers for the success of fintech ecosystems in the region through the mitigation of legal uncertainty and the creation of secure conditions for entrants. As the regional ecosystem evolves, so too does the Fintech policymaking and regulatory proposals.”

Juan Ketterer, Institutions for Development Manager, Inter-American Development Bank, added that this year’s report highlighted that alternative finance is a very dynamic Fintech vertical in Latin America and the Caribbean.

“The steady 94% growth is opening the way to the first yearly US $1 billion [total]. The region is using alternative finance to finance businesses with a total of US $566 million out of US $663 million. Alternative finance is part of the solution to close the gap of financial inclusion to more than 45 million Micro, Small and Medium  Enterprises. The inclusion of numbers on gender, showing how, on average, 31 per cent of the fundraisers, while 32% of the funders are female, is a new key result.  We will follow through this critical data to determine the effect of women in the alternative finance vertical.”

Some other interesting data points provided by the CCAF Americas report include:

  • The US is the second largest alternative finance market in the world as it trails China (dramatically). As shared in the CCAF Asia report, China hit US $358 billion in 2017 growing by 47% versus year prior.
  • Real Estate Crowdfunding increased by 128% to $1.8 billion in 2017 from $821 million in 2016. The model accounted for 4.2% of the total market in 2017 and grew by 128% annually.
  • Balance Sheet Consumer Lending accounted for $15.3 billion, up an impressive 409% from the $3.0 billion in 2016. The model accounted for 34.5% of the total market in 2017. This was the largest model across the region.
  • Marketplace/P2P Business Lending registered $1.5 billion, slightly down 0.33% from the $1.5 billion in 2016.
  • Marketplace/P2P Consumer Lending reached $14.9 billion, down 29% from the $21.1 billion in 2016. This model accounted for 33.6% of the total alternative finance market volume in 2017 in the Americas.
  • Equity Crowdfunding accounted for just $260.9 million in 2017, down 54% from $569.5 million in 2016. This sector is stagnating
  • Rewards platforms are included as well. As with the other parts of the world, this sector is in decline down by 26%
  • The research identified 48 platforms that pivoted away from ‘orthodox’ alternative finance models or were no longer active.

See:  Fintech Reports and Research

CI reached out to Tania Ziegler, the Lead in Global Benchmarking at the CCAF. Ziegler manages the Centre’s alternative finance benchmarking program that covers Europe, the Americas, Asia Pacific, and the Middle East and Africa. We asked her a series of questions related to the CCAF Americas report.

CI: Overall, what were your impressions of 2017 v. 2016 for the evolution of alternative finance in the Americas?

Tania Ziegler: 2017 saw a lot of growth across the region, but very much at different levels. In the United States, we observed steady growth (24% up from the previous year) but this driven largely by strong incumbent firms and, in particular, consumer lending activities. We noted that a handful of platform respondents from previous year’s had left the ecosystem for more traditional activities, there was some consolidation in the market, and there was a limited number of new entrants when compared to previous years.

Canada saw exponential growth (159%), with a focus on finance for business borrowers. Unlike previous years, the Canadian landscape shifted away from non-investment model such as reward and donation crowdfunding, towards more sophisticated lending models. We also saw significant investment from Canadian platforms towards R&D activities, especially in process streamlining. Canada seems to have a strong emphasis on innovation-driven activities in lending.

CI: The US continues to dominate in the Americas yet trails China. Why is that?

Tania Ziegler: The US is certainly the market leader in the Americas, but is dwarfed considerably by China (whose market volume was $358 billion in 2017).

Simply put, China’s Fintech market is reflective of a retail investor environment that is far quicker to embrace technology, coupled with somewhat underdeveloped traditional banking options for both individual funders and fundraisers.

Yet, it is important to note that in 2017, we saw a significant slow down in alternative finance compared to previous years.

In our Asia-Pacific report this year, we noted that this downturn comes alongside profound industry shake-ups and regulatory changes. Though technology-enabled altfin models certainly will continue to grow in China, until regulation catches up, we expect that 2018’s figures will be somewhat dampened.

Continue to the full article --> here

Download the Reaching New Heights PDF report --> now

 


NCFA Jan 2018 resize - Cambridge Centre for Alternative Finance Publishes Americas Report: Sector Grows by 26% as US Market Leads with 97% of Market Share The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

Latest news - Cambridge Centre for Alternative Finance Publishes Americas Report: Sector Grows by 26% as US Market Leads with 97% of Market ShareFF Logo 400 v3 - Cambridge Centre for Alternative Finance Publishes Americas Report: Sector Grows by 26% as US Market Leads with 97% of Market Sharecommunity social impact - Cambridge Centre for Alternative Finance Publishes Americas Report: Sector Grows by 26% as US Market Leads with 97% of Market Share

Support NCFA by Following us on Twitter!







NCFA Sign up for our newsletter - Cambridge Centre for Alternative Finance Publishes Americas Report: Sector Grows by 26% as US Market Leads with 97% of Market Share




Crypto Regulation | Jul 12, 2024 US House Fails to Override Biden's Veto on SEC's Controversial Staff Accounting Bulletin 21 (SAB 21) Recently, a bill to override President Joe Biden's veto of the controversial SEC Staff Accounting Bulletin No. 121 (SAB 121) was not successfully passed by the U.S. House of Representatives. According to SAB 21, businesses that hold digital assets on behalf of clients are required to list those assets on their balance sheets as liabilities. See:  SEC Intensifies Accounting Audits in 2023 The override attempt failed to garner the two-thirds majority required to overcome the presidential veto, even though it was approved by both the House and the Senate with support from both parties. Background on SAB 121 and Bill to Overturn It SAB 121, which the SEC released in March 2022, has caused controversy in the cryptocurrency and banking worlds. Through correct accounting for digital assets, the guideline seeks to protect investors and enhance transparency by possibly reducing the risks associated with their volatility. However, opponents contend that this regulation places excessive constraints on companies and may inhibit innovation in the quickly developing crypto markets. Representative John James (R-MI) proposed the bill to repeal SAB 121, and ...
Freepik pch.vector accounting - Cambridge Centre for Alternative Finance Publishes Americas Report: Sector Grows by 26% as US Market Leads with 97% of Market Share
Enforcement | Jul 12, 2024 SEC Ends Investigation into Paxos Over Binance USD Token with No Enforcement Action Taken The Securities and Exchange Commission (SEC) of the United States has finished its probe into Paxos Trust Company concerning the stablecoin Binance USD (BUSD) issuance and is not taking any enforcement action over BUSD. Paxos statement as reported by WSJ: “Paxos Trust Company has always maintained that its USD-backed stablecoins are not securities under federal securities laws and that the Wells Notice was unwarranted and unjustified. We are proud of our relentless advocacy for stable-value digital assets and that the SEC staff determined it will not bring enforcement action against Paxos in connection with BUSD.” Background Since 2019, Paxos, a regulated blockchain infrastructure company, collaborated with Binance to issue a BUSD stablecoin which was authorized by the New York Department of Financial Services (NYDFS) and is fixed 1:1 to the US dollar. The SEC warned Paxos in a Wells Notice at the beginning of 2023 that there may be enforcement action taken in response to BUSD's classification as an unregistered security. The NYDFS was compelled by this notice to direct Paxos to stop issuing new BUSD tokens, while stablecoin redemptions were ...
US Securities Exchange Commission - Cambridge Centre for Alternative Finance Publishes Americas Report: Sector Grows by 26% as US Market Leads with 97% of Market Share
Crowdfunding | Release | Jul 11, 2024 Innovative tool highlights top U.S. startup ecosystems, revealing key trends and insights Denver, Colorado, July 11, 2024 - Today, the "Crowdfunding Genome", a visualization tool and ecosystem report, was launched by Crowdfund Capital Advisors (CCA), a global authority in investment crowdfunding research, data, and analysis. This data research highlights the best cities for entrepreneurship and crowdfunding innovation while providing insights into startup ecosystems across the country. What is the Crowdfunding Genome? A visualization tool developed by CCA, the Crowdfunding Genome provides access to comprehensive crowdfunding data insights unveiling the inner workings of startup ecosystems. Using sophisticated analytics and exclusive investment crowdfunding data, it evaluates a number of variables that affect and rank startup performance, such as fundraising amounts, investor participation, and entrepreneurial conditions of the sector. The Genome also comes with a complimentary 'Investment Crowdfunding Ecosystem Report 2024' that explores the results. Phoenix/Scottsdale Tops the List of Best Startup Ecosystems in the USA According to the Crowdfunding Genome, Phoenix/Scottsdale is currently the nation's top startup ecosystem based on a number of variables contributing to the region's top ranking: See:  Fintech Fridays EP62: The Future of Investment Crowdfunding: Innovations, Data, and Opportunities Growth in ...
CCA Crowdfunding Genome July 2024 - Cambridge Centre for Alternative Finance Publishes Americas Report: Sector Grows by 26% as US Market Leads with 97% of Market Share
AI | Jul 11, 2024 SMEs will be Turbocharged as we move from 'AI Tools' to 'Guided AI Agents' We agree with NFXs recent post that using "Guided AI Agents" instead of "AI tools" can automate a large amount of work and advance automation beyond simple job execution to produce efficiencies and specific business outcomes.  For the first time ever, there's a technology that can help solve the problem of 'delivering uniqueness at scale', and small-and-medium-enterprises (SMEs) need to take advantage of this momentous opportunity. 1. Automation Potential “This very moment, we could easily automate away 60% to 70% of the global economy’s work hours with AI.” With today's technology, around 50% of all work activities may be automated. By 2025, AI will generate 97 million new jobs while replacing 85 million existing ones. By 2024, organizations will use hyper-automation technology to reduce operating expenses by 30%. SMEs should reduce costs and increase productivity by using AI to automate repetitive processes like compliance checks and customer service. 2. From “Tasks” to “Outcomes” Guided AI Agents represent a shift in focus from completing tasks to achieving outcomes. This approach enables businesses to measure success based on tangible results rather than the ...
Freepik AI assisted person interacting with AI robot - Cambridge Centre for Alternative Finance Publishes Americas Report: Sector Grows by 26% as US Market Leads with 97% of Market Share
Regulation | Jul 11, 2024 Insights from SEC's Director of Enforcement:  Federal Securities Laws in the Age of Crypto in a recent speech titled "What's Past is Prologue: Enforcing the Federal Securities Laws in the Age of Crypto", Gurbir S. Grewal, Director of the SEC's Division of Enforcement, delivered an overview of the present legal environment for crypto assets at the Third Annual Symposium of the William & Mary Business Law Review. See:  Challenges in Global Crypto Regulations – Lessons from Dubai He highlighted the importance of strong enforcement, the continuous applicability of federal securities laws, and the delicate balancing act between innovation and compliance. Below are select quotes across five themes from the depths of the SEC's securities enforcement division that shine light on the implications for the cryptocurrency industry. 1. Historical Continuity of Securities Regulation Grewal emphasizes the continued applicability of the basic principles that informed the development of US securities laws. “The history of our securities laws makes clear that Congress always intended the definition of what is a security to be principles-based and flexible to cover the many kinds of schemes where promoters seek others’ money and promise profits in return.  Whether something is a security ...
Gurbir S. Grewal Director Enforcement Division SEC - Cambridge Centre for Alternative Finance Publishes Americas Report: Sector Grows by 26% as US Market Leads with 97% of Market Share
Funding | Jul 10, 2024 Xero's Beautiful Business Fund is back for 2024! The Xero Beautiful Business Fund initiative is designed to help small businesses flourish, offering over CA$630,000 in funding across various regions, including Canada (excluding Quebec), Australia, New Zealand, Singapore, South Africa, the UK, and the US. More than CA$630,000 in total funding available.  Prize winners are responsible for any applicable taxes. Eligible countries include Canada (excluding Quebec), Australia, New Zealand, Singapore, South Africa, the UK, and the US.  You must be a Xero small business customers in one of the specified regions with maximum 50 employees. Apply by the deadline August 27, 2024 Winners will be announced at the end of October 2024 Step 1:  Choose One or More Categories For your entry, choose one or more of the following categories. To increase your chances of winning, you can enter all categories: 🌿Innovating for Environmental Sustainability --> Tell us how your company is advancing its sustainability initiatives. 🤝 Strengthening Community Connection --> Emphasize the contributions and positive impact you're bringing to the community. See:  UK Announces £7.3 Billion to Unlock Green Private Investment 🚀 Trailblazing with Technology --> Showcase your creative use of technology to take the ...
Xero Beautiful Business Fund - Cambridge Centre for Alternative Finance Publishes Americas Report: Sector Grows by 26% as US Market Leads with 97% of Market Share
Funding | Jul 10, 2024 UK Announces Major Boost for National Wealth Fund On July 9, 2024, the UK government has announced intentions to invest £7.3 billion in funds to the National Wealth Fund for economic development and sustainability.  The goal is to unify major financial institutions under a single plan and stimulate private investment, especially in the green and growing industries. Realignment of Financial Institutions The British Business Bank and the UK Infrastructure Bank will be merged into the National Wealth Fund as part of the new project. The goal of this realignment is to produce a more unified investment strategy that capitalizes on these institutions' advantages to attract significant private sector investment. The announcement coincided with the launch of this enormous project, which took place at No. 11 Downing Street with the gathering of the National Wealth Fund Taskforce by Chancellor Rachel Reeves and Business Secretary Jonathan Reynolds. See:  Green Fintech 2.0 Shows Progress in the UK Dame Amanda Blanc, the CEO of Aviva, C.S. Venkatakrishnan of Barclays, and Mark Carney, the former governor of the Bank of England, are among the prominent individuals on the task group, which is chaired by the Green Finance Institute. Their combined ...
UKs national wealth fund - Cambridge Centre for Alternative Finance Publishes Americas Report: Sector Grows by 26% as US Market Leads with 97% of Market Share
Launch Release | Jul 10, 2024 Fig Financial introduces a fully digital personal loan platform in Canada, with 10 second rapid approvals With the launch of its services, Fig Financial—Canada's first fully digital personal loan provider—is changing the personal lending market with approachable online solutions. More than 9,000 Canadians have benefited from the company's over $135 million CAD in personal loan funding to date via various partnerships. Fig is now directly available to customers, offering a quicker, more transparent, and safe borrowing experience. Overview In as little as ten seconds, Fig Financial provides quick loan approvals. Unlike typical banks, where the application procedure can take days or weeks, this one can be finished in about ten minutes. Users can easily apply for loans at any time and from any location thanks to the user-friendly, entirely digital application process. Flexible loan terms, payback plans, and amounts allow for customization to meet specific needs. See:  How Fintechs Can Integrate AI for Efficiency Gains Fig fills a significant void in the industry by offering straightforward, transparent and hidden-free information on loan terms. The latest security protocols protect user's data. The management team at Fig, led by CEO Francois Cote, has over 50 years ...
Freepik tirachardz personal loan - Cambridge Centre for Alternative Finance Publishes Americas Report: Sector Grows by 26% as US Market Leads with 97% of Market Share
Jul 10, 2024 When it comes to industries that operate wholly online, such as online casinos or eCommerce platforms, there are certain ways of marketing that prove to be more effective than others. And some don’t fare as well. Take, for example, digital marketing, which is one of the most effective ways and, if done and executed right, can be the best way of acquiring new customers. And so take the online casino industry as a prime example. It is an extremely crowded and competitive market, and a lot of its audience is already online, so this is the perfect battlefield for them to pit their marketing techniques against one another in order to try and establish a dominant position and gain more customers. A perfect example of someone who is perfecting this digital marketing technique is LuckyKoala online Casino in Canada. How are they attracting customers? When it comes to digital marketing, this can be a broad term. When it comes to marketing a casino or a certain promotion online, there are many ways that this can be done. And there is no doubt one of these has been targeted at you in one manner or another. Of course, ...
Freepik rawpixel.com digital marketing - Cambridge Centre for Alternative Finance Publishes Americas Report: Sector Grows by 26% as US Market Leads with 97% of Market Share
Global Fintech Market Report | Jul 9, 2024 The 2024 Global Fintech Report by Boston Consulting Group (BCG) and QED Investors provides a comprehensive view of the continuously evolving fintech landscape. The research provides key insights for fintech startups, investors, and financial institutions globally by highlighting important trends, growth projections, and noteworthy hurdles. Ten takeaways from the study are outlined below, emphasizing the prospects and threats that will influence the direction of fintech. 💹 $1.5 Trillion in Revenue by 2030 (positive) By 2030, the global fintech market is expected to generate $1.5 trillion in sales, rising at a rate of around five times that of 2023.  The fintech industry has enormous potential, as seen by its exponential expansion. This is still a lucrative opportunity for innovators, and offers a profitable chance to develop and grow. 📈 14% Annual Revenue Growth (positive) Over the last two years, global fintech sales have increased at a rate of 14% per year (or 21% if crypto and China-related fintechs are taken out).  The fintech industry's steady revenue growth is indicative of both its tenacity and the rising demand for digital financial services. Businesses can take advantage of this trend to grow their operations and ...
BCG and QED 2024 Global Fintech Markets - Cambridge Centre for Alternative Finance Publishes Americas Report: Sector Grows by 26% as US Market Leads with 97% of Market Share

 

Leave a Reply

Your email address will not be published. Required fields are marked *

five × 2 =