These fintech stocks are growing at an alarming rate for investors.

Top 4 Fintech Stocks to Watch Right Now

Fintech is short for financial technology and is one of the hottest new sectors on the stock market today. A fintech company is one that simply applies technology to the financial world.

Examples of fintech services include online banking, payment processing, peer-to-peer lending, and buy now pay later (BNPL). Many investors believe that fintech has a strong future because of the rise of the digital world.

It has never been easier to get a loan or open a checking account right from the palm of your hands.

Investors looking to gain exposure to the fintech market should consider buying fundamentally strong companies that are growing rapidly and ideally already generating profits.

Block

Block, formerly known as Square, is a fintech company that allows businesses to set up payment processing systems using just a mobile phone or tablet.

Block provides a way to easily accept credit cards for any type of business that does not necessarily want to spend the money on their own payment systems.

In addition to this service, Block also owns Cash App which is a peer-to-peer payment service similar to Venmo. In addition, Block also acquired Afterpay, which is a buy now, pay later company.

Block has done an amazing job of acquiring companies with strong futures and plenty of room for growth. While the companies Block owns may not be as big as its competitors, this only means there is more room for growth and the potential to steal more market share from competitors.

PayPal

PayPal is the biggest fintech company for online payments and much more. They also own Venmo, which is another industry-leading service that is widely used in the U.S.

As of 2021, PayPal has over 426 million users and this number continues to grow year over year. In 2010 PayPal’s annual revenue was $3.5b and by 2021 this number grew by over 622% up to $25.3b. This proves that PayPal is growing at an alarming rate and is not showing any signs of slowing down.

However, if they happen to have a bad year where they do not grow as much this can spook investors, even though over time, they have proven themselves to be a growth machine.

PayPal is one of the largest fintech companies with a rapidly growing market cap that is currently around $133b making it a rather safe investment.

SoFi

SoFi Technologies was founded in 2011 and was recently taken public via SPAC by Chamath Palihapitiya. SoFi is essentially an online-only banking platform that allows its customers to do everything a traditional bank can do.

This business model is convenient because you will never have to worry about driving to the bank to take care of anything. Instead, you can easily take care of everything straight through the mobile app from anywhere in the world.

They were recently approved for a bank charter as well which allows them to borrow money at an even cheaper rate than before which can improve profit margins.

SoFi also acquired Galileo which is a company that works with many of SoFi’s competitors including Robinhood, Chime, Monzo, Revolut, Varo, and TransferWise.

Affirm

Affirm is a buy now, pay later fintech that allows its customers to essentially take out a loan to buy things online without paying in full upfront.

The amazing part about Affirm is that they are partnered with over 168,000 merchant partners. This is great because it means Affirm does not have to market its service since the merchants selling the products are already doing that for them.

They are partnered with some amazing companies too such as Amazon which is the largest e-commerce company in the world. Additionally, they are also partnered with Shopify, another giant in the e-commerce space.

Ever since Afterpay was acquired by Block, Affirm has been the largest BNPL player in the world.

Bottom Line

The fintech sector is growing rapidly and is not showing any signs of slowing down.

There are many great fintech companies to choose from that are continually scaling their operations and looking to run the future of finance straight from mobile phones.

As the world focuses on transforming into a more digital environment, there is no reason why the fintech sector will be going away anytime soon. There is a wide array of fintech companies in industries such as peer-to-peer lending, online banking, BNPL, and payment processing.

It is your job as an investor to decide which fintech will continue to thrive and have a good place in your stock portfolio.