Fintech in Belgium – A country with unexplored potential

Belgium is sadly not (but) a sizzling spot of Fintech on the planet. Opposite to our surrounding international locations from which a number of Fintech Unicorns have emerged (e.g. Qonto, Alan or SpenDesk in France, Revolut, Monzo and Starling Financial institution within the
UK, Mollie, Adyen and Bunq within the Netherlands or Commerce Republic, N26 and Solarisbank in Germany), Belgium sadly doesn’t have a pure Fintech unicorn but.
That is unlucky, as such unicorns usually kind a supply of inspiration and a pool of cash and other people, which end in attention-grabbing new Fintech start-ups.

Belgium does nevertheless have some unicorns, which have a robust hyperlink with the monetary providers business, i.e. Collibra (information governance, for which the monetary sector is one among their main targets), Odoo (a platform for enterprise apps with
sturdy monetary integrations), Deliverect (integration of on-line meals orders into restaurant’s POS techniques) and staff.blue (supplier of web providers), however no pure Fintech participant.

It’s a pity that Belgium will not be extra dominant on the Fintech map, because it has plenty of strengths to carry to the desk:

• To start with there’s the location. Positioned centrally in Western Europe and having a dense street, railway and airport infrastructure, it permits to connect with the remainder of Europe and the remainder of the World in an easy method.

• Belgium is a part of the European Union and the Euro zone, that means worldwide growth to different Euro international locations is rather a lot simpler, as most monetary directives relevant in Belgium, additionally apply in different European international locations and Nationwide Financial institution
  (monetary) licenses will be simply passported to different European international locations.

• There may be after all additionally the presence of the European headquarters and several other different worldwide establishments (like e.g. the NATO). This give an in depth proximity to the cases discussing the monetary directives of tomorrow and it additionally
  provides entry to a pool of worldwide, extremely certified assets.

• Belgium has a lengthy profitable historical past of banking and insuring, which resulted in a number of main (historic) gamers having their worldwide or European headquarters in Belgium, e.g. SWIFT, Euroclear, Financial institution of New York Mellon and MasterCard.
  Traditionally Belgium has been a pioneer within the monetary providers business, with techniques like Proton (a digital pockets in your financial institution card), Payconiq (a QR-based cost system) or Isabel (a multi-bank system for firms to entry financial institution their accounts from
  completely different banks in 1 platform) launched years forward of comparable initiatives in different international locations. Moreover some profitable Fintech avant-la-lettre like Clear2Pay, Unified Publish or Isabel Group originated from Belgium.

• It’s also the house to a number of the most revolutionary banks on the planet, like KBC and Belfius, which rank each within the prime 5 of getting one of the best cellular apps (in line with a number of research), surpassing a number of nicely revered neobanks. These banks
  not solely provide all of the revolutionary options for which neobanks grew to become well-known (like digital onboarding, PFM options, account aggregation, offers within the types of cashbacks and different promos…​), however have gone even a step additional. E.g. KBC affords entry to a big
  quantity of third-party providers of their app (like mobility and authorities providers, but additionally the chance to order a restaurant or perhaps a service known as Aim Alert, which notifies clients by way of the KBC app, when a soccer spotlight happens) and goals to
  develop into a form of super-app in Belgium.

• The availability of extremely expert assets, due to this historic presence of enormous monetary gamers in Belgium and the high-quality instructional system. The Belgian universities kind a whole lot of wonderful (software program) engineers, mathematicians,
  economists…​ who’re instantly deployable within the Fintech business and are sometimes multi-lingual (with good information of English).

• And at last the present giant gamers have various Fintech start-up accelerators and packages and Fintech labs, that are an incredible supply of innovation. E.g. KBC StartIt program, Belfius Studio or completely different innovation packages of MasterCard
  (just like the StartPath-programme or Mastercard Fintech Specific programme).

Sadly all these strengths don’t sufficiently compensate for the deficits of the Belgian market.

• To start with Belgium lacks considerably the entrepreneurial local weather that matches the Fintech sector, i.e. the Fintech sector is a world of quick and aggressive development, which matches troublesome with the Belgian entrepreneurial tradition, which is
  extra conservative and sluggish rising (therefore additionally the explanation of numerous very profitable historic SMEs in Belgium). Moreover the overall mentality in Belgium in the direction of entrepreneurs will be fairly unfavourable.

• Linked to that first level, there’s additionally a lack of VC funds, particularly for early – extra dangerous – (seed) rounds. There are some VCs lively within the area, e.g. SmartFin Capital (Jurgen Ingels), Pamica (Michel Akkermans), Hummingbird Ventures,
  Volta Ventures, Fortino…​ and in addition some government-supported funding autos like PMV, FPIM, GIMV, GIMB or Sambrinvest, however these are significantly smaller and fewer centered on Fintech than VCs in different international locations.

• The small measurement and complexity of the market. A Belgian Fintech has solely entry to a market of 11 million shoppers and instantly has to cope with plenty of complexity, i.e. supporting 3 and even 4 languages (Dutch, French, German and English),
  address the regional (Flanders, Brussels and Wallonia) variations in regulation and tradition/habits and must persuade a market which is kind of conservative within the adoption of recent applied sciences.

• The complicated construction and bureaucratic processes of Belgium, consisting of three areas, 3 communities and a federal authorities, makes it exhausting to deal with all laws and to search out your method via the net of administration. This division
  of duties over completely different authorities ranges (e.g. fiscal regulation is a federal duty, whereas regulation and subsidies for reinforcing employment and innovation is at regional stage) makes it additionally very exhausting to return with an englobing “grasp”
  plan to spice up the Fintech sector (like e.g. the profitable initiative of president Macron in France to spice up the Fintech sector).

• Even in a small nation like Belgium, completely different hubs – usually linked to (competing) universities (i.e. primarily Brussels, Antwerp, Ghent, Louvain and Louvain-La-Neuve) compete with one another, as an alternative of working collectively to place Belgium on the
  Fintech map.

• Belgium has additionally a fairly conservative and risk-reluctant regulator, which makes it exhausting for Fintechs (coming with new concepts) to acquire their licenses and get a good stage enjoying area. Moreover the Belgian regulator has its fingers full
  with the regulation of all massive historic monetary establishments (of which there are rather a lot in comparison with the scale of Belgium). Because of this, the regulator is extra a blocking than a stimulating issue. This opposite to international locations just like the UK and Lithuania, the place
  the regulators have been stimulating innovation in Fintech.

• The Belgian market is troublesome to disrupt, because it already has a really prime quality of banking providers. The low market penetration of profitable neobanks (like N26, Revolut, Bunq…​) on the Belgian market is one of the best of proof of this. Even
  initiatives centered totally on Belgium, like NewB (though not positioned as a Neobank, however extra as a cooperative, moral and sustainable financial institution), Banx (the Belfius-Proximus initiative) and Aion have difficulties to get a considerable market share.

• And at last the disproportional giant variety of sturdy incumbent gamers have a tendency to draw plenty of expertise and sometimes block entrepreneurship (not essentially intentionally, but when assets are capable of do attention-grabbing initiatives at giant establishments,
  they won’t be inclined to create or be part of a start-up or scale-up).

Regardless of all this, Belgium is unquestionably not a inexperienced area on Fintech firms both. Fairly some Fintech gamers are very profitable each in Belgium and overseas and have monumental potential to develop even additional.

To start with, there are some historic (avant-la-lettre) Fintech gamers, like Isabel Group, Bancontact, Ogone (now Wordline-Ingenico), Clear2Pay (now FIS), Unified Publish, Purchase Means, Callatay & Wouter (now SOPRA Banking Group)…​
Moreover Belgium has a wealthy historical past of sturdy (consulting) service suppliers within the monetary providers sector, like e.g. Capco (now a part of Wipro), Projective, DynaFin or Kronos group.

However there’s additionally a complete checklist of Belgian Fintechs created within the final decade resembling

• PayTech: Fintechs simplifying nationwide and worldwide funds, e.g.

  • Bancontact Payconiq : chief of cost providers in Belgium, with the Bancontact cost scheme and cellular cost app Payconiq. The corporate can be on the short-list of the EU to be positioned as a European cost various for VISA and MasterCard.

  • Bonsai: a cellular cost answer designed for native consumers

  • iBanFirst: facilitate B2B funds throughout quite a few currencies

  • Digiteal: invoicing and cost options for companies

  • Moneytrans: sending cash on-line for migrants

  • Monizze: (social) voucher options

  • POM: e-invoicing and e-payment expertise options

  • Twikey: enabling easy and accessible SEPA direct debits via e-Mandates

• WealthTech: Fintechs supplies providers to enhance investing and asset administration:

  • Abbove (previously PaxFamilia): digital wealth administration platform for monetary advisors

  • Blanco: a software program answer for asset managers

  • Curvo: an funding app designed for simple index investing

  • Gambit Monetary: digital funding options

  • InvestSuite: an AI-based funding administration purposes

• RegTech: audit, compliance and danger administration options, monetary information administration and id administration:

  • b.advantageous: industrialize the regulatory reporting for monetary establishments

  • Complidata: Commerce Finance Threat Monitoring, AML Optimisation and Company KYC Automation

  • Discai: commercialisation of the AI purposes constructed internally for KBC

  • Harmoney : digital platform for complicated onboarding and compliance processes

  • itsme: a digital id system

  • RiskConcile: danger and compliance technological options, with a concentrate on asset managers.

• LendingTech: Fintechs providing options for lending and financing:

  • Edebex: buyer invoices market that enable companies to promote their invoices to buyers

  • Koalaboox: small enterprise administration and financing options

  • Oper: options to digitize mortgage choices

• Private and Enterprise Monetary Administration (PFM and BFM): Fintechs providing answer to get extra insights in your private and enterprise funds and to optimize your price range administration

  • Accountable.eu: monetary companion of at this time’s self-employed employee)

  • Cake: providing market insights and cashback campaigns primarily based on monetary information

  • Cashforce: options to assist money forecasting

  • Recovr: automated assortment of unpaid invoices

• InsurTech: Fintechs providing innovation within the insurance coverage sector

• Blockchain and Crypto: Fintechs providing options primarily based on blockchain and crypto applied sciences:

  • Arkane Community: a software program platform which permits to transform conventional coding to the blockchain

  • Bit4You: crypto alternate platform

  • Elyps: funding funds specialised in digital belongings and blockchain tech

  • Keyrock: cryptocurrency market maker

  • Ngrave: providing a cryptosecurity answer, i.e. {hardware} pockets to retailer your crypto-tokens

  • Sofitto: decentralizes cost techniques and digitizes money

and naturally we shouldn’t neglect the tech firms lively in adjoining providers, which have a robust hyperlink with monetary providers and thus Fintech, e.g.

• Accounting, with firms like Silverfin, EMASphere, OkiOki, Yuki…​

• HR Tech companies with sturdy hyperlink to monetary providers, like wage administration, extra-legal advantages or expense administration, e.g. Officient, Payflip, Rydoo, MobileXpense…​

• Doc administration and digital course of automation with firms like Doccle, Unified Publish, Docbyte, Penbox or Metamaze

• Actual Property Tech with tech firms like Rock.Property or Setle, but additionally offered in partnerships between Belfius and Immmovlan or KBC and Immoscoop and within the type of platforms to handle co-working locations, like d.work, Frame21, SpareSpace,
  Bar D’Workplace, Deskalot…​

• FoodTech with firms like Deliverect, APICBASE, Youmeal or Growzer

• Mobility Tech with a complete selection, i.e. from MaaS suppliers (like Skipr, Olympus, Vaigo, Moveasy or Modalizy), to mobility managers (like Mbrella) or new automobile leasing and sharing firms (like Lizy, Cambio, Poppy or Partago) all the way in which
  to a complete vary of motorcycle leasing firms, like Ubike, Cyclis, B2Bike, O2O, Lease a motorcycle…​

As you’ll be able to learn, there’s plenty of potential within the Belgian market, if all noses are put in the identical course. Let’s hope we are able to quickly welcome our first pure Fintech unicorns.