Financial Analytics Market

Financial Analytics Market Outlook (2022-2032)

The financial analytics market revenue totaled US$ 9.3 Billion in 2021 and is projected to register a Y-o-Y expansion rate of nearly 11% to reach US$ 10.3 Billion in 2022.

During the 2022-2032 period of assessment, the market is poised to register a CAGR of 9.3% to be valued at US$ 25.1 Billion. Increasing financial transaction volumes across key verticals has led to increased uptake of efficient financial analytics tools.

Report Attributes	Details
Market Size in 2021	US$ 9.3 Billion
Market Size in 2022	US$ 10.3 Billion
Expected Forecast Value (2032)	US$ 25.1 Billion
Global Growth Rate (2022-2032)	9.3% CAGR
Market Size of the U.S (2032)	US$ 8 Billion
Growth Rate of China (2022-2032)	9% CAGR
Expected Market Share of U.K (2032)	4.4%
Key Financial Analytics Providers	Oracle Corporation IBM Corporation SAP SE Teradata Corporation TIBCO Software SAS Institute Alteryx Qlik FICO Infor Birst Google LLC Information Builders Zoho Corporation Domo Inc.

Significant growth prospects are visible for the financial analytics industry, especially concerning wealth management. From 2015 to 2021, the wealth management segment flourished at a 10.1% value CAGR, while demand for financial analytics solutions grew at a CAGR of 10% during the same time period. Geographically, the U.S is poised to represent a dollar opportunity worth US$ 4.6 Billion until 2032.

2015-2021 Revenue Analysis of Financial Analytics vs. Future Outlook 2022-2032

Extensive digitization, complicating nature of various financial transactions, rising need to safeguard sensitive financial exchanges and heavy reliance on big data have all contributed immensely to the uptake of financial analytics throughout the 2015-2021 period of assessment. As per market research and competitive intelligence provider Fact.MR, financial analytics market flourished at a CAGR of 10.6% during the said historical period.

With every industry experiencing rising scale of operations, it is no surprise that they are seeking out approaches to ease financial operations. The need to effectively manage and streamline financial dealings has become the need of the hour. With virtually every vertical shifting business exclusively online in certain areas, courtesy the pandemic, deployment of high-grade financial analytics platforms is sure to incline.

Key industries such as BFSI, IT& telecom, healthcare & pharmaceuticals, manufacturing & automotive and retail & e-commerce, all are looking to invest in financial analytics platforms across multiple regions. In the historical period, China experienced maximum growth at a CAGR of 10%, given the rapid rate at which the country is transforming its manufacturing sector through industry 4.0. From 2022 to 2032, the global market for financial analytics is poised to register 2.4x growth.

Key Growth Drivers of the Financial Analytics Industry

Rapid Integration of Digital Technologies Fueling Financial Analytics Uptake

Every industry is at a cusp of revolution, with digitization and Industry 4.0 taking over operations. This is also true for the finance domain. As the volume of digital financial transactions burgeon, the need for designing robust security and workflow optimization platforms has risen. This need was felt more acutely during the height of the COVID-19 pandemic.

Throughout the pandemic’s life cycle, there were unprecedented changes in human behavior. Working models changed dramatically, with key industries compelled to switch permanently to the virtual space. Mobile transactions spiked, with personal trading apps recording voluminous transaction frequencies. It was reported that in the United States alone, over a third of consumers increased usage of online banking during the pandemic.

While the industry has managed to weather out the storm, it has become clear that the winds of change are not transient. Digital adoption rates are peaking, a cookie less future looms large, and data governance has taken center stage. With all this happening, financial institutions will need to rethink data architecture, data collection strategies, measurement models, and how they can responsibly leverage data to target the right people, advertise their products, and personalize experiences across their digital properties. Hence, investments in advanced financial analytics platforms is becoming evident.

Financial Analytics securing Firm Footing in the E-Commerce Industry?

The e-commerce industry is entering a new era. After an initial phase wherein companies focused largely on making their products and services available to potential customers via the internet, users are now trying to take a more comprehensive look at their deployments, one that correlates each sale to their entire operation. Consequently, a new breed of financial analytics tools is emerging.

Financial analytics tools enabling businesses to correlate such items as software depreciation or sales leads are becoming highly important. In fact, analytics has become a top management concern in many enterprises because e-commerce advances mean that virtually every market segment faces more competition now than ever before. The internet has eliminated many of the traditional geographical barriers that companies used to fend off competitors, so firms can market their goods and services worldwide.

It is expected that worldwide e-commerce sales will increase by nearly 17% in 2022 and beyond, likely to surpass US$ 5 trillion. To facilitate the ever increasing transaction volumes, prominent e-commerce giants are likely to take advantage of the available financial analytics tools in the market and streamline workflows, detect anomalies and frauds and ensure financial security.

Country-wise Analysis

How Opportunistic is the Financial Analytics Industry in the U.S?

Extensive Applications in the Real Estate Sector anticipated in the long-run

The U.S is projected to reach a valuation of US$ 8 Billion in 2032, expected to grow at a CAGR of 8.8% throughout the forecast period. Growth of the industry is attributed to its applications in streamlining financial management across the real estate industry. Over the years, there has been talk of incorporating big data by leveraging digitized solutions to streamline real estate workflow.

Given the voluminous nature of financial transactions throughout the industry, companies in the real estate domain are adopting advanced financial analytics software to maintain records of daily business dealings. Executives are pushing their firms to unlock the potential of their decades of records of transactions, property valuations, asset management and listing through financial analytics platforms.

With more than US$ 33 Billion in value in 2020, the U.S housing market is only expected to flourish further in the future. In spite of the COVID-19 pandemic putting brakes on said projections, the industry has recovered well in the past 2 years. Hence, numerous start-ups offering real estate services are likely to spawn in the future. Players such as HouseCanary and Reonomy are already providing platforms for real estate companies to acquire voluminous data and synthesize them to provide high grade financial analytics platforms.

How is the Manufacturing Industry Opening Growth Prospects in China?

Focus on Improving Industry Output and Streamlining Customer Experience driving growth

Manufacturing is by far the largest industry in China, accounting for greater than 46.8% of the country’s GDP, attributed to intensive investment in heavy industries. Since the past century, China’s manufacturing industry has experienced tremendous growth, going from being a small-scale player in global manufacturing to become the largest player as of the previous decade. Naturally, the volume of financial transactions have increased simultaneously.

To increase output, Chinese authorities have been incorporating big data, thereby inducing a digital transformation across the entire industry, ensuring improved decision making and performance enhancement. An effective strategy to ensure operational continuity for all manufacturing industry leaders is to invest in robust financial services and analytics platforms.

As per the analysis conducted by Fact.MR, the financial analytics industry in China is projected to grow at a 9% value CAGR until 2032, registering an absolute dollar opportunity worth US$ 1.1 Billion to reach US$ 1.9 Billion. The financial services industry is witnessing a lot of developments and evolutions, for companies that are adopting digital transformation as a platform to compete with competitors are growing multifold. Hence, companies such as PingAn have cemented their presence in the Chinese market.

Will the Healthcare Industry provide a Catalyst for the U.K Financial Analytics Industry?

Innovations to Disburse Affordable and Good Healthcare Services Driving Growth

With an anticipated market share of 4.4% in 2032, Fact.MR expects the U.K financial analytics market to attain a prominent position in the global landscape. As the country strives to deliver affordable and good quality healthcare to its citizens, major healthcare and pharmaceutical companies are streamlining their financial workflows, thereby increasing the scope for financial analytics solutions and platforms.

An assessment of U.K’s domestic healthcare industry shows that about 18% of the taxes received by the government is directed towards improving healthcare services, which is about 4.5% of the average citizen’s income. Overall, around 8.4% of the country’s GDP is spent on healthcare. Majority of the healthcare disbursed is through the National Health Service.

Like any other industry, financial data is important to improve healthcare outcomes by streamlining the decision making process. Furthermore, hospitals are under constant scrutiny by government agencies, who are required to report patient care and financial data to ensure co-operation with established guidelines. To facilitate this, the National Health Survey has developed a finance analytics and financial governance approach to provide financial expertise and support for strategic operations and planning, a range of contracts and advice and implementation of appropriate payment mechanisms supporting delivery of better care, among others.

Country-wise Forecast CAGRs for Financial Analytics (2022-2032)

Country	CAGR
U.S	8.8%
U.K	8.4%
China	9%
Japan	8.8%
South Korea	8.3%

Category-wise Insights

Why are Financial Analytics Solutions Most Preferred by Industries?

Emphasis on Cutting-Edge Customer Experience Solutions Driving Growth

According to Fact.MR, the financial analytics solutions segment is forecast to expand at a CAGR of 8.8% from 2022 to 2032. Recent innovations in financial analytics solutions to provide the most streamlined customer experiences across key industries is expected to pivot market growth in the forthcoming decade.

Both deployment of financial function and financial market analytics solutions will witness a significant increase, given the increasing volumes of digital transactions taking place. This pace has especially increased in the post-pandemic era. Advanced financial analytics solutions help mitigate risks and ensure security.

How is Financial Analytics proving Useful in Wealth Management?

Transitioning towards Advanced Analytics is a Boon for Key Stakeholders

Wealth management is an important aspect for multiple industries, which is why the need to incorporate advanced financial analytics is rising. Typically, the wealth management industry has been embodying obsolete values and providing tailor-made services. However, with digitization, this trend is evolving.

Combined with stiff market competition, digitizing financial and wealth management services is yielding better results for businesses. Wealth managers are unlikely to be able to serve modern clients effectively without a digitized operating model. This will support advisory and non-advisory activities and service ever changing investment preferences. Hence, a CAGR of 8.8% is expected for this segment.

Competitive Landscape

The presence of a large number of service providers renders the global financial analytics market highly competitive. Prominent players are offering highly innovative software solutions, attributed to rapid digitization of the global financial landscape. Besides, important growth strategies such as mergers & acquisitions, collaborations and partnerships are also relied upon.

• In November 2021, Oracle Corporation announced updates to its Fusion ERP Analytics platform which enables finance and operations leaders gain greater visibility into costs and assets to accelerate decision making. These updates include a better understanding of KPIs, metrics and dashboards without the need for coding, integration or data expertise
• SAP SE announced in March 2022 that it has completed the acquisition of a majority stake of Taulia, a prominent provider of working capital management solutions. This acquisition will fuel SAP’s business network, strengthening its solutions portfolio for the CFO office. Taulia’s solutions will both be tightly integrated into SAP software as well as continue to be available standalone
• In February 2022, Teradata Corporation announced a global partnership with Microsoft to integrate its Vantage data platform with Microsoft Azure. This will permit businesses seeking to modernize their data analytics workloads with security, elasticity and reliability. From retailers providing personalized customer experiences to financial service organizations using automated analytics to track fraud, both companies will connect wide data sets and streamline workflows

Key Segments Covered in the Financial Analytics Industry Survey

• By Component :

  • Financial Analytics Solutions
    • Financial Function Analytics
    • Financial Market Analytics
  • Financial Analytics Services
    • Managed Financial Services
    • Professional Financial Services

• By Applications :

  • Financial Wealth Management
  • Financial Governance, Risk & Compliance Management
  • Financial Forecasting & Budgeting
  • Customer Financial Management
  • Financial Transaction Monitoring
  • Financial Claims Management
  • Financial Fraud Detection & Prevention
  • Financial Stock Management

• By Deployment :

  • On-Premises 
  • Cloud-based 

• By Organization Size :

  • SMEs
  • Large Enterprises

• By Vertical :

  • BFSI
  • IT & Telecom
  • Government
  • Energy & Utilities
  • Manufacturing & Automotive
  • Healthcare & Pharmaceuticals
  • Retail & e-Commerce
  • Media & Entertainment
  • Transportation & Logistics
  • Other Verticals (Real Estate and Education)

• By Region :

  • North America 
  • Europe
  • Asia Pacific 
  • Latin America 
  • Middle East