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Romania’s Fintech Map is in its second year of trying to evaluate the regional startup ecosystem. This edition presents over 60 projects, both native and international fintech companies that have local branches in the country, with more names added every year. A new addition to the selection is the blockchain and cryptocurrencies category, two verticals presenting exciting growth potential for 2021.
We reached out to the map’s founder, Razvan Enache, to discuss the fintech mapping methodology. The companies presented have at least an MVP and an established organization. This project is a “work-in-progress”, not a finite presentation, with minor releases during the year and a big update in the fall. It only covers 60-70% of the market, some companies didn’t answer or didn’t want to be part of it, and it shows startups that integrate technology into financial services offerings.
“We don’t claim to perform an exhaustive census. However, we think it’s a fundamental step in helping local fintechs, especially the smaller ones, present themselves and reach investors’ attention,” shared Razvan Enache with The Recursive team.
Due to the development of new technologies, the financial market and electronic payments’ niches are showing compelling performance indicators. Transactions in the last years assured the country a place in the Top 20 European countries ranked by the number of fintech funding rounds. This market represents senior financial services companies that want to improve their technological offer, as well as new project disruptors using technology to save time and money.
The Romanian Fintech market
On the B2C side, the pandemic pushed online payments to expand and Romanians have shown an interest in digital payments, investment funds, or alternative loans. But many continue to be conservative, investing in physical transactions due to trust or because they lack the know-how about using digital services. For the B2B part, Romania becoming an emerging market comes with a new set of international investment advantages.
“I think that outsourcing fintechs will continue to maintain traction, and companies like FintechOS, Druid, or Typing DNA (listed under the Enablers’ category on our Map) will remain investors’ darlings,” disclosed Razvan and continued that he expects the largest segment in the map – the Payments & Wallets – to take a step back as global fintechs will consolidate themselves on the market and that we could see more entries in sectors like RegTech, AI, or Lending.
The report shows that after the Covid-19 outbreak, a few companies managed to attract the funding opportunities they were looking for. Some startups faced challenges, like a lower valuation than their European competitors. Other projects closed their doors or adapted by developing new products, like digital wallets.
There are two big challenges this sector is facing and the reason why other European countries, like Poland, have over 200 fintech startups. First, the long time it takes to get a license; AISP (Account Information Service Provider) or a PISP (Payment Initiation Service Provider) can take up to 9 months. Second is the high legal fees reaching up to €100K.
Because of the exponential growth in the last few years, at the beginning of 2020, a few Romanian companies joined forces to develop the Romanian Fintech Association – RoFin.Tech. that offers legal and business support. These are Beez, Pago, PlatiOnline, PaybyFace, PayPact, SeedBlink, ThinkOut, Stockberry, PayVent, Symphopay, Volt, Lendrise, iFactor, Finqware, Moneymailme, Selfpay, Traderion, and Salarium.
News in the Romanian B2C and B2B fintech niche
The main categories in the Romanian Fintech Map 2021 are payments and wallets, investment and wealth management, personal finance, insurtech, financial infrastructure, enablers, blockchain and cryptocurrencies. Some companies are part of more categories. There are also the categories lending and crowdfunding, with SeedBlink, Fagura, TBIPay, Orange Money, and iFactor and challenger banks, with Revolut, Monese, and PaySera.
- In the personal finance niche, the names standing out are Think Out, Beez, Dollarbird, FinBoard, CashControl, Morfin, Salarium, Mokka, and Dealwise.
Salarium is the new B2B entry founded in 2020 that has raised €100K to offer employees the money they have earned without having to wait until the end of the month. ThinkOut is a B2B Iasi-based startup, launched in 2016, providing automated cash flow analysis and forecasting for SMEs. While Morfin is a Luxembourg-based company with Romanian DNA offering both B2C and B2B solutions since 2018. The app can be used to issue, distribute, transact, and redeem tokens to increase employee engagement and loyalty.
- In the payments and wallets niche, the names standing out are Pago, Argentum, Minutizer, Volt, Pay24, Moneymailme, Oveit, PaybyFace, mobilPay, Selfpay, ProxiCash, Canvi, M3Payments, DiPocket, Bankio, MonePOS, TBIPay, and Orange Money.
MonePOS by AROBS is a Cluj-Napoca-based company with over two decades of experience in the IT and software market. The company created a new contactless B2B2C payment solution. PaybyFace, a 2019 startup with Amsterdam headquarters, shows that the sector is quite a competitive one and that it offers a secure digital payment ecosystem. While Beez is a Cluj-Napoca-based B2C company launched in 2018. The app presents an alternative payment method later than the date of purchase.
- In the financial infrastructure niche, there are FintechOS, Symphopay, Pluridio, Modex, Finqware, Traderion, Swazm, Keez, Tremend, and TotalSoft.
Keez is a B2B Romanian AccountingTech startup, launched in 2018, allowing entrepreneurs access to all their company’s documents from the comfort of their pocket. A big name on the market is FintechOS, founded in Bucharest in 2017, with operations in the UK, The Netherlands, Denmark, and Austria. They offer fast, smart automation, and they are also part of the insurtech market. While Swazm is a 2018 Timisoara-based blockchain infrastructure company that sees computer power as a digital currency.
Vestinda is the latest entry, founded in 2019 in Bucharest. This B2C project is currently in pre-seed and it was created to connect retail investors with market experts. Stockberry is a Ploiesti-based B2C startup founded in 2017 using AI for Retail Investors who want to discover what people are talking about cryptocurrencies. While iFactor is a B2B Bucharest-based project founded in 2016 promoting an alternative hybrid marketplace for liquidity trading.
- In the enabler’s niche, there are Ebriza, Paid Analytix, TypingDNA, Druid AI, Roboself, SmartFintech, TrustyCamera, Morphl, FinLight, PrimeDash, OmniCredit, OceanCredit, InstantFactoring, Confidas, PayPact, and Allevo.
TypingDNA is the leading name in this sector. Founded in 2016 by a Romanian, the company’s headquarters are in New York, they provide a commercial authentication API. While a new entry is FinLight, a Craiova-based B2B startup that wants to facilitate the decision-making process. While PayPact is one of the newest entries. The B2C company, launched in 2020, offers an insurtech app facilitating fast compensation after incidents.
LDV Exchange is a B2B Bucharest-based startup founded in 2018 to be a fast bridge between crypto and flat, offering online and cash exchanges. Sablier is a B2C 2019 company founded in Iasi targeting digital natives to be able to get paid in real-time. While Elrond is both a B2C and a B2B 2017 project based in Sibiu that aims to create a global, transparent, financial system.
This project was developed by Razvan Enache, a journalist with almost two decades of experience in this niche. Among the report’s mentors and investors, there are Ciprian Paltineanu – IHC investor, Malin-Iulian Stefanescu – TechAngels President, Tudor Stanciu – Digital 2 Law Co-founder, Cosmin Anghel – Clifford Chance LLP, Cristian Carstoiu – Digital Transformation & Analytics at EY, and Mircea Vladan – Activize Managing Partner.