NUR-SULTAN – The Astana International Financial Centre (AIFC) Tech Hub released the “Fintech Startup Landscape in Kazakhstan” report, the first study of Kazakhstan’s startup ecosystem, according to the press service of the AIFC.
The AIFC Tech Hub was created to unite global start-ups, entrepreneurs, corporations, investors, experts, and specialists in the field of innovation. The development of fintech at the AIFC includes programs for start-up support, corporative innovations, the venture capital market, specially developed rules, and regulators that allow testing products and solutions in the field of fintech.
The report presents the results of the survey of more than a hundred startups and interviews with local experts.
According to the report, the majority of startups that have entered the market over the past two years belong to three main sectors including e-commerce, EduTech, and FinTech.
“This happened partly due to the COVID-19 pandemic and the imposed restrictive measures. These three sectors are the most visible in the Kazakhstan market and continue to grow continuously,” reads the report.
The startup founders are concentrated in two regions – Nur-Sultan and Almaty. The results of the report confirmed that most founders are male with an average age of 25-34. Only 7.4 percent of Kazakhstan’s projects were founded by women.
Nearly 40 percent of startups saw new business opportunities emerge during the pandemic and 23 percent of companies adapted their services and products to this new reality.
It is reported that the start-up sector in Kazakhstan is still emerging since 72 percent of respondents are at the early stage of development and have been operating for less or equal to three years. While nearly 40 percent are in the pre-revenue stage, meaning they have not generated any sales yet.
The most popular fintech destinations are payments, transfers, mobile wallets (20 percent), and financial software/ back – and middle – office solutions (18 percent).
From a geographical perspective, most startups target either the Kazakh or CIS region market, and very few startups focus on markets outside of the CIS region.
More than half of the respondents did not generate any revenue in the last 12 months, which can be understood as being part of the early stage of many startups. 30 percent of the startups produced more than 10 million tenge (US$23,449) last year.
Some 72 percent of companies plan to expand to the international market in the future. The authors noted that startups usually focused on reinforcing a strong domestic audience before pursuing business on a global scale.
The report also provides a list of 15 promising companies to watch in the following years. It includes the Biometric fintech startup focused on facial recognition, biometric identification and financial scoring, the BoolloSafe startup that offers insurance services and the Bueno company that provides financial instruments including B2B installments to empower clients, while boosting sales, cashbacks that work, and other companies.
The authors believe that the report is of great interest for technology entrepreneurs who can gain insight into the market and competitors, and help government officials better understand the innovation ecosystem, and inform investors about the market so that they can make better investment decisions.