6 Minutes
Fintech’s renewed momentum
Digital banks and digital asset businesses are emerging as the primary engines of growth across the fintech sector, helping push industry profits and revenue to new highs. A recent industry study by Boston Consulting Group and FT Partners shows fintech firms posted record operating margins and broad profitability in 2025 as they expanded into lending, wealth, insurance, and cross-border payments while accelerating digital asset and AI investments.
Revenue, funding, and exits: a rebound led by performance
Fintech revenue surpassed half a trillion dollars in 2025 after growing roughly 22% year over year, a pace more than four times faster than incumbent banks. That top-line growth was matched by improved operating performance: average EBITDA margins across major public fintechs reached about 20%, with nearly three-quarters reporting profits. This recovery, analysts note, was driven mainly by improved unit economics and product expansion rather than easier capital markets.
Investor activity reflected renewed confidence. Fintech equity funding rose significantly, and exit markets gained traction: venture and growth financing climbed, IPO activity increased, and merger and acquisition volumes expanded sharply. The deal pipeline showed a clear shift toward targets that strengthen capabilities in digital assets, compliance and artificial intelligence.
Digital assets and AI: strategic battlegrounds
The report highlights digital assets as a major focus for strategic acquirers and product builders. As competition intensifies, many fintech companies prefer acquisitions to accelerate entry into the digital asset and crypto infrastructure space rather than building capabilities from scratch. M&A activity in 2025 illustrated this trend, with scaled fintech firms completing more deals than traditional banks for the first time outside 2023.
AI as a productivity multiplier
Artificial intelligence is also reshaping how fintech teams operate. Firms that integrate AI into core workflows — underwriting, fraud detection, compliance monitoring, developer productivity and customer support — can realize multiple-fold gains in efficiency. The most successful implementations were not merely tool add-ons but redesigns of processes around AI-enabled capabilities.
Neobanks evolve into multi-product platforms
Neobanks are transforming beyond simple digital checking and payment offerings into full-stack financial platforms. Leading digital banks have been broadening into wealth management, insurance, consumer lending, investing, mortgages and international payments. This product diversification is aimed at deepening customer relationships and raising lifetime value through cross-selling and alternative underwriting models.
Where neobanks are expanding
- Europe: Several major neobanks have rolled out investment services, trading tools and mortgage products as they pursue more complete financial relationships with customers. - Latin America: Expansion has centered on personal credit and consumer lending, addressing large unbanked or underbanked segments with localized credit approaches. - United States: Market conditions are more challenging due to high customer acquisition costs, entrenched incumbents and fragmented regulation. Outside entrants often find it more viable to target specific niches or high-value segments rather than attempt coast-to-coast scale rapidly.
M&A and strategic priorities
Deal activity in 2025 underscored a strategic pivot toward acquiring capabilities in crypto, compliance and AI. Scaled fintechs completed hundreds of acquisitions, outpacing bank-led dealmaking in volume. Buyers focused on accelerating time-to-market for digital assets, strengthening regulatory tech stacks and incorporating AI-driven features into product roadmaps.
This trend also reflects a pragmatic approach: buying specialized teams and technology is often faster and less risky than lengthy internal development, especially in complex domains such as blockchain infrastructure, custody, tokenization and crypto-native payments.
Regulation and chartering: narrowing the gap with banks
Regulatory developments are reshaping fintech strategy. The report notes that government frameworks across the U.S., UK and EU are gradually closing the regulatory gap between banks and fintechs by offering clearer licensing and charter options. A growing number of fintech companies are pursuing federal bank charters or equivalent licenses to unlock funding advantages, control product distribution and own customer relationships directly.
Compliance remains a substantial cost and strategic barrier, which is why many fintechs are acquiring regtech capabilities as part of broader growth bets.
Implications for crypto and blockchain players
For crypto and blockchain companies, the fintech maturation trend presents both opportunities and competition. Neobanks moving into crypto-friendly services, custody and trading create new distribution channels for digital asset products, while traditional crypto firms can leverage partnerships or M&A to integrate with regulated payment rails and lending ecosystems. Firms that can combine robust compliance, secure custody and seamless UX will be positioned to capture the next wave of mainstream adoption.
Outlook: a more mature, profitable fintech landscape
Industry leaders are no longer just chasing growth at all costs. The sector appears to be entering a phase where profitability, product breadth and regulatory alignment matter equally. Fintech now represents an increasing share of global financial services revenue as digital assets, AI and cross-border payments reshape competitive dynamics.
For investors, incumbents and founders, the priority is clear: build interoperable, compliant platforms that leverage blockchain and AI while expanding into high-margin products like credit, wealth and insurance. Those who execute on integrated offerings and scalable crypto infrastructure stand to benefit most from fintech's next growth wave.
Key takeaways
- Neobanks and digital asset businesses are central to fintech growth and improved margins. - M&A is concentrated on crypto, AI and compliance capabilities. - Regulatory pathways are becoming clearer, encouraging chartering activity. - Firms that combine blockchain-native products with strong compliance and UX will lead future market share gains.
As fintech firms continue to scale and diversify, the lines between traditional banking, crypto platforms and technology providers will keep blurring, ushering in a new era where digital assets and neobanks jointly define fintech innovation and market expansion.
Source: crypto
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