Almost two weeks to go before we bid farewell to the 2022 World Cup. We’ve already seen many surprising and entertaining matches but some matches are just expected. At least that is the case for Group F – Belgium, Canada, Morocco, and Croatia.
They might have beaten Canada in the World Cup match, but they certainly won’t in fintech! Located in Europe, one would think that Belgium would follow suit its neighbouring countries. But that couldn’t be far from the truth. As advanced as it is, with a great educational system, Belgium is at the back of the line when it comes to fintech and innovation.
There are many reasons for that, mainly and most importantly is the rigid, conservative, financial system in the country. Regulators in Belgium are basically old-fashioned when it comes to finance – leveraging safety to innovation. That, of course, kills any motivation for innovation. On the rare occasion, a startup decides to embark on this journey, they face the problem of funding -especially at the seed (riskier) round. As well-established and trusted as the Belgian brick-and-mortar banking system as it is, it serves as another hurdle for the fintech scene.
These are just a few of the many reasons why fintech is unlikely to thrive in this innovation-hostile environment. The thing is that Belgium has a lot of stifled potential such as; having highly-skilled talent and belonging to the Europe Union and the Eurozone. Meaning that most financial directives that would take place in Belgium would also apply to other European countries (sorry, Brexits). So, for now, looks like Belgium will only stick with its excellent chocolates.
The stereotype says that Canadians are nice people, but when it comes to fintech, Canadians are vicious! Whether it’s regulations or tax incentives, Canada is doing its best to climb up the fintech ladder. The government knows that fintech could drive the economy and so there’s a lot of flexibility and space for fintech startups to grow with the country’s regulatory sandbox and launchpad programs.
In 2021, Canada had about 700 fintechs with the majority focused on payments followed by lending, back office, wealth management, and personal finance management. If you want to measure how successful the fintech scene is in Canada, just know that so far there are five fintech unicorns– Dapper Labs, Wealthsimple, Blockstream, Trulioo, and Freshbooks. This is not a small feat, btw!
Everyone is dusting off their digital transformation agenda and Morocco is no different. While it’s not up in the ranks of fintech, it just means that it has a lot of opportunities. With 71% of the population are unbanked, the country has one of the highest rates in that area. However, the pandemic has accelerated online payment just a bit. But not much as there’s still a lack of trust and misconceptions about online payments.
The most developed segments in Morocco’s fintech are payments, remittance, and POS systems. Other fintech segments exist but they’re not as prevalent such as; crowdfunding, personal financial management, lending and data analytics. When it comes to crypto, a big part of the population wants to dabble in it. However, like most MENA countries, crypto is banned.
Julie Andrews once said, “a queen is never late, everyone else is simply early.” So true, Julie, but unfortunately, this is not the case for Croatia’s fintech. It arrived so late that no one noticed when it arrived. But that’s okay because it’s working its way up. So far, it has put its hand on several fintech segments; payments, microfinance, and even has its own cryptocurrency brokerage BitcoinStore. However, Croatia still faces many challenges to develop mainly the absence of laws governing fintech, blockchain, and artificial intelligence.
Finally, I’m gonna go ahead and announce Canada as the winner of this round’s fintech games!