The world’s largest fintech companies are operating at record profitability, with 74% of major public players turning a profit in 2025, according to a joint report by Boston Consulting Group (BCG) and FT Partners.
The Global Fintech Report 2026 indicates that global fintech revenues have passed the half-trillion-dollar mark, growing at 22%.
This growth rate is more than four times faster than that of incumbent financial institutions. Equity funding in the sector reached US$58 billion, a 53% increase year on year.
Average EBITDA margins rose by 400 basis points to 20% in 2025. The sector now accounts for about 4% of total global financial services revenue.
The report attributes this rebound to operating performance rather than cheap capital or speculative optimism.
Exit markets are also recovering.
Fintech initial public offerings (IPOs) increased by 50% year on year to 42 deals in 2025.
Mergers and acquisitions (M&A) volumes accelerated, reaching US$251 billion in 2025 compared to US$184 billion the previous year.
“Fintech has not simply bounced back from the reset years, it has come out the other side as a fundamentally more mature industry,”
said Inderpreet Batra, Managing Director and Senior Partner at BCG.
“The firms leading today are profitable, disciplined, and expanding into new products and geographies with a seriousness that was not always present in the boom years.”
Regulatory shifts and acquisition trends
Regulatory changes are narrowing the gap between banks and fintech firms. In the European Union, the UK, and the US, charter and licensing pathways are becoming more accessible.
Major fintechs are increasingly applying for banking charters to lower funding costs and gain direct ownership of the customer relationship.
For the first time on record outside of 2023, scaled fintech companies acquired more businesses than banks did. Fintechs completed 659 deals in 2025, compared to 589 by incumbents.
M&A is increasingly being used to build capabilities in AI, digital assets, and compliance, as building these organically is often deemed too slow.
Neobanks expanding into financial platforms
Neobanks are moving beyond basic payments and low-friction onboarding to become broader financial platforms.
Leading players are diversifying into lending, investing, insurance, cross-border transfers, and mass-affluent wealth management.
Consumer credit represents a major growth area.
Unsecured lending allows neobanks to deepen customer relationships using alternative underwriting models.
European neobanks in particular have expanded their wealth and trading offerings and moved into mortgage products.
AI driving productivity
AI continues to reshape sector competition. BCG data shows that fintechs using AI effectively achieve up to five times greater developer productivity.
The strongest near-term gains are seen in engineering, underwriting, compliance, and customer support.
“Large, established companies are pouring capital into AI, but capital alone hasn’t produced breakout capability,”
said Steve McLaughlin, CEO and Managing Partner at FT Partners.
“The difference comes down to management, engineering talent, and the drive to actually rewire the organisation.”
The findings suggest the sector has transitioned into a more mature landscape. The basis of competition has shifted from digital nativity and category creation to profitable scale and regulatory readiness.
Featured image credit: Edited by Fintech News Switzerland, based on image by Pixelid via Magnific
