EqualOcean highlights six innovative players operating across a broad swathe of the fintech landscape.
- China’s tech giants are now household names, but the country is also home to a large, sophisticated fintech sector.
- We highlight 6 listed Chinese fintechs that are driving innovation across lending, insurance, brokerage, and real estate.
- These firms are increasingly venturing outside their home market, which generates an additional structural growth driver.
(Reading time: 9 minutes)
China’s fintech ecosystem: a quick tour
Due to its large population, strong infrastructure, and consumers’ openness to new technologies, China’s fintech ecosystem is one of the largest and most profitable globally. The best companies in the sector score favorably against global peers.
Relative to other emerging markets, China’s fintech scene is more diverse, with a lower weighting of payments and lending-focused companies than in other markets. Key areas of relative strength include blockchain and Software as a Service (SaaS).
The large size of the home market and the breadth of offerings (meaning companies can focus on their respective core niches) may explain why the fintech sector’s profitability is higher than that in other emerging markets.
China leads in terms of global fintech unicorns, according to the Hurun Institute; as of April 2021, it had 18 unicorns (29% of the global total), with a combined valuation of USD 240 billion (60% of the global total).
Fintech investors have few large-cap listed investment opportunities
Investors have bought into China’s technological prowess in a big way; the top 6 listed ‘new-tech’ firms have a combined market capitalization of USD 1.9 trillion. Kuaishou is the latest entrant to this list, following its IPO on February 5, 2021.
However, for investors looking at the listed fintech space, the choice is still limited, particularly after the failed Ant Group IPO. The six names we consider in this report have a combined market capitalization of around USD 125 billion.
Disclaimer: Our content is intended to be used solely for informational and educational purposes, and not as investment advice. Always do your research and consider your personal circumstances before making investment decisions. ChineseAlpha nor EqualOcean is not liable for any losses that may arise from relying on information provided.