Expert opinion on the development of fintech in Russia
Alexander Dunaev, the co-founder of ID Finance, decided to share his view on the development of Fintech in Russia. He talks about whether the industry exists at all in the local market and what features of management prevent it from developing along the already known path.
Paradoxically, the world’s most growing topic of innovative financial technologies in Russia remains almost unnoticed. Few publications that do not specialize in this industry are ready to devote at least the first page to fintech. According to experts, for many publishers of business newspapers, this topic still seems frivolous and not credible.
Fintech in Russia: problems and solutions
As VTsIOM has not studied the assessment of the activity in this sphere yet , at the end of 2018 the auditing company Deloitte decided to conduct its own research of Russian fintech market.
According to the analysis, the industry volume is slightly more than 54 billion rubles, while the growth for the year was 12%. For comparison, banking assets in Russia increased by eight percent over the same period. According to experts, for only a developing industry, these are rather low indicators.
According to Dunayev, such results are explained by several factors. First, the population of Russia – by its majority – is poor, and the market, unlike its competitors, is small. Secondly, the country’s policy is not aimed at the expert, besides within its borders, one can note the absence of the internal market of mergers and acquisitions. Finally, in Russia, there is no archaic technical legacy of the financial system, as in the West.
As a result, the fintech industry does not just have to blindly copy the working foreign models, but also to find the degree of how the product meets market demand, adapted to local characteristics.
As experience has already shown, those fintech companies that succeed in models that work in conditions of lack of funding, use the strengths of the domestic system and capitalize on the shortcomings of existing players without direct competition with them usually achieve success.
All these factors determine the direction of the market: if in general, the largest fintech companies abroad traditionally grow at the expense of consumer services (Ant Financial, Credit Karma, Lending Club, Paypal), then we can assume that in Russia the next growth stages will be driven by the enterprise. –solutions.
From the point of view of the popularity of individual areas in the future, Alexander Dunaev was able to identify five main areas: crowdfunding in real estate, technology in attracting clients, credit risk management services, user identification systems, and cybersecurity.
The expert also added that, in fact, in addition to these five, other technologies have been made more widely used, but it is not worth expecting that fintech will become popular overnight. Most likely, this industry will remain the gray cardinal of the market, which does not come into contact with consumers, but at the same time drastically alters the market.