European Fintech Index Highlights Inconsistent Industry Definitions, Calls for Standardisation
Monetary platform ConnectPay has recognized vital gaps and inconsistencies within the out there information on Europe’s fintech business, prompting the launch of the European Fintech Index (EFI).
In keeping with ConnectPay, the shortage of uniform and credible information sources, coupled with diversified definitions of ‘fintech’, has made it tough to precisely monitor the business’s growth.
The World Financial institution‘s International Findex Database, the most recent information set, stopped updating in 2021, inflicting many international locations to depend on outdated data. At present, solely a 3rd of European international locations use information newer than 2021 to current their fintech ecosystems, which limits the flexibility to make knowledgeable comparisons and selections.
The EFI analyses markets by means of three dimensions: enterprise attractiveness, market attractiveness, and fintech attractiveness, which replicate key strengths and potential areas of progress for fintech ecosystems of 32 European international locations. The undertaking additionally seeks to spark discussions on standardising fintech definitions and bettering market transparency, inviting specialists to contribute to the continuing refinement of the Index.
Marius Galdikas, CEO of ConnectPay, mentioned: “The Index offers an unbiased view of the information on fintechs. Mixed with the choice to filter information based mostly on case-by-case relevance, it allows decision-makers on any stage — fintechs, buyers, or regulatory authorities — to make data-backed selections that might result in larger business progress.”
The EFI
The general rankings of the EFI could also be shocking for some. As an illustration, the Index positions vibrant fintech hubs just like the UK and France in ninth and tenth place total.. However, smaller international locations like Estonia and Luxembourg rank fourth and fifth respectively.
The EFI additionally factors out the problem of inconsistent definitions of ‘fintech’ throughout the business. As an illustration, Eurostat and the European Banking Authority (EBA), every have their very own definitions of what a fintech is. In keeping with Galdikas, various definitions impede correct monitoring of business’s progress and hopes the EFI will assist elevate related discussions.
“It’s extra of a query of what ought to nonetheless fall underneath the time period, and what ought to in all probability be omitted. Some rankings go so far as together with pension funds, which might doubtlessly skew market information when analysing fintechs particularly.”
Following the launch of the EFI, ConnectPay will invite market specialists to supply insights on bettering and enhancing the Index.
“The contribution of specialists shall be important to the success and doable progress of the European Fintech Index. In any case, sparking extra conversations that might enhance market transparency, specify the definition of fintech and assist monitor the progress of the business would already be a terrific success,” Galdikas mentioned. “In addition to, by sharing concepts and insights we might replicate on, we would develop the Index sooner or later, making it an much more in-depth and dynamic market evaluation instrument.”
