Nikolay Seleznev is Chief Strategy and Business Development Officer at Uzum.
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From South America, Central Asia, to Southeast Asia, fintechs are shaking up financial systems. Yet, in my view, these companies are not getting the attention—and investment—that their performance deserves, especially from Western investors.
This is despite super-fast growth, enviably large user bases, and profit, they still get less funding than businesses in the West. This ongoing hesitation isn’t just a small mistake—it’s a missed opportunity.
Why Are Western Investors Holding Back?
There are several reasons for this funding gap. First, bias plays a big role in how risky developing countries are seen. Many global investors still view markets outside of the US or Europe as unpredictable, even though they’re showing signs of stability and growth.
For example, Uzbekistan is currently enjoying an annual growth rate of 6.5%. More broadly, the fintech boom in these places is driven by need – there are over 1 billion unbanked people globally demonstrating huge potential.
Second, investors from rich countries tend to stick to businesses they know well. The financial structures, customer habits, and traditions in emerging markets can be very different from those in the West, making them tougher to judge with usual investment methods.
But this should be seen as a chance instead of a problem – emerging markets are pioneering new fintech models that Western economies are now trying to replicate.
Innovation is Happening Here First
Emerging markets aren’t just trying to catch up; they’re setting new standards. Look at China's DeepSeek, which created an AI language tool that rivals OpenAI's ChatGPT but costs a lot less.
In the fintech world, companies are mixing financial services with big digital platforms. For example, China's Douyin (which is like TikTok in China) raked in $374 billion through short video shopping.
This focus isn’t just on tech; it’s about making financial systems that fit emerging markets. While Western fintech firms struggle with complex regulations and crowded markets, their peers in emerging countries are tackling big financial inclusion issues and quickly earning trust from users.
Social Impact Meets Investment Potential
Fintech in emerging markets is driving major social change too. Traditionally, women were often excluded from financial systems. But platforms like Sea Money and ByteDance are flipping that script. Nowadays, these platforms don’t just include women but actively get them involved, giving them better access to loans, savings, and investments.
Even entertainment platforms are changing into important financial tools. In regions with high mobile phone use but expensive data costs, short videos are filling the gap. A farmer in Kenya can share farming tips, while an artisan in Mexico can sell handmade crafts – all through one app. These mixed-use models are boosting economic participation in ways Western platforms are only starting to figure out.
Regulation Is Getting Smoother
A common worry about investing in fintech in emerging markets is the unpredictable rules. But governments in these areas are quickly improving their regulatory landscapes. For instance, Nigeria has enforced strict digital banking rules, and Indonesia has rolled out measures to fight fintech fraud.
This shows that officials understand the need to balance oversight with innovation. These changing rules mean that companies working closely with regulators early on are likely to enjoy a more stable environment.
The Real Danger? Missing Out
Fintech in emerging markets isn’t just a temporary trend; it's leading the future of financial services. Western investors who keep ignoring this sector are missing out on the next big wave of fintech innovation, which is already transforming the global financial scene.
The urgent question is no longer whether to invest but how to do it successfully. Those who wait may find themselves left behind while the fintech revolution moves forward elsewhere.