Ukrainian Fintech: emerging business trends


Over 100 Fintech-enterprises are currently working on the Ukrainian market. More than half of the companies (58%) were founded over the past three years, 21 startups were created over the past year. Experts predict that such growth rates will continue in 2019. These are the findings of research conducted by the Ukrainian Association of Fintech and innovative companies together with the National Bank of Ukraine and Visa.

Among the main reasons for the positive dynamics is the absence of global players in the market due to the imperfection of Ukrainian legislation. Also, cleansing the banking system led to the release of many specialists from the banking sector who are ready to try themselves in innovative start-ups.

Payment services dominate in the structure of Ukrainian Fintech companies. Their number increased by 13% over the past year to 38. Among the leaders are also mobile wallets (22), consulting and analytical systems (26), companies that specialize in various technological and infrastructure solutions for financial business processes (36). Among the new for Ukraine are the already popular abroad insurtech and regtech. At the same time, interest in the blockchain in the country is still low, over the past year only three new companies appeared in this segment and their number increased to 16.

Most of the Ukrainian Fintech today at the beginning of sales (24%) or business scaling (48%) and only one in five companies is a mature business (19%). Only 1% are in the process of realization of the idea and MVP (7%), which goes against global trends. Among the possible reasons are the underdeveloped infrastructure of support for start-ups and the low level of entrepreneurial culture. One way or another, but Ukrainian entrepreneurs prefer to enter the market with a ready-made product.

In addition to the need for support in the early stages of development, one of the main problems of startups is the lack of access to finance. In Ukraine, about 63% of companies are operate without attracting funds from investors. While abroad, most startups are funded by venture and seed funds, investment companies.

Due to reserch 43% of Ukrainian fintech companies already work abroad. The most popular market is Europe (72%), then CIS (30%) and the USA (21%). According to experts, this trend will also increase. According to the study, 73% of those who are still working in the domestic market, are planning to enter foreign markets in the near future.

In general, fintech companies employ more than 4 000 people. An interesting observation, 27% of managers and owners of such enterprises are women.

The main forecasts of experts on the development of the Fintech industry for the next year:

• Fintechs related to payments will continue to be the locomotive;

• Active access to foreign markets or business expansion abroad;

• Increasing the share of digital payments;

• Further development of cooperation between fintech companies and banks;