Fintech has a history of supporting the disadvantaged going back decades, but is it possible that it will eventually become the engine of change in the same way as some more traditional businesses?

After all, private family run concerns in particular have frequently spawned philanthropic ventures such as Andrew Nisbet’s The Nisbet Trust, John Denholm’s the Denholm Group and Barnaby Swire’s The Swire Trust.

If we look far enough ahead, is it possible that fintechs might go down the same path? Of all the high-growth sectors out there, fintech certainly has three of the hallmarks.

Fintechs can be kept in the family and avoid going public

You don’t have to look far to see fintechs that might well end up as family businesses passed down through the generations by the original founders. And keeping a business both unlisted and in the family have traditionally been indicators of a future large-scale philanthropic mission.

Stripe for example, founded by brothers Patrick and John Collison, is the most obvious example of a fintech that could evolve into a multi-generational family business. Brex is another that may well stay private. But, while it’s just guesswork, perhaps the biggest indicator of the possibility of a business being retained by the family of one or more of the founders is when it corners the market quickly.

Fintechs might be online businesses but they can still corner niche markets just as effectively as offline companies, and we can already identify a few that might last the distance, and stay private.

Klarna is a Swedish payments giant that allows customers to buy now pay later – an online alternative to the credit card. The first of its kind, it recently became the biggest fintech in Europe. It has upwards of 60m customers and partners with some of the biggest high-street names.

CEO and co-founder Sebastian Siemiatkowski sounds like he’s in it for the long haul. When asked recently about an IPO, he said: “For 14 years in a row, we have proven our ability to actually be a profitable company and that we have the fundamentals in place to be a standalone business.”        

Fintech is people-facing and has a social mission

Traditional banks, rightly or wrongly, have a reputation for ignoring the needs of customers or being slow to adopt new services based on changing demands. Fintech is the complete opposite. It anticipates demands and is always pushing itself to innovate and develop new products that support the kind of lives we will live in the future.

In a very short period of time, fintechs have move from targeting millennials to creating new products that support a wide range of demographics and needs. One area that’s growing fast is financial services for seniors and over the last five years we’ve seen a number of fintechs aimed directly at them including EverSafe which provides identity protection against financial exploitation and Pefin an AI financial adviser aimed at the senior market.

But perhaps more than this, many fintechs are driven by a strong social mission. For example, Wagestream aims to solve the challenge of payday poverty by enabling employers to literally stream wages into the bank accounts of workers across the month; and others have already established their own philanthropic initiatives. Take Latvian fintech, Mintos for example. In April this year it launched the Mintos Impact Fund to support environmental and social charities.

Continuing to innovate in emerging markets

There can be no doubt that fintech has a social heritage in the developing world and this template has inspired other founders around the world. The drive to help the disadvantage through fintech is as strong as ever.     

Since 2016, a large number of new social fintechs have been supported by The Catalyst Fund an accelerator backed by JP Morgan Chase and the Bill & Melinda Gates Foundation. A quick look at this list of young fintechs shows the social sector to be as vibrant as ever.

Recipients of funding across the developing world include life-insurance fintech MobiLife; Leaf, a virtual bank for refugees and stateless populations; Rukula which offers small loans for household appliances; ESCALA, helping people save to access education, and Abalobi, an app supporting disadvantaged fishing communities and fishermen.

Fintech has a mission, social heritage and all the hallmarks of a sector that will have a huge impact not just on the way we bank and use financial services but also on the way we support disadvantaged people around the world, whilst ensuring people closer to home are also included in the revolution it is creating. You wouldn’t bet against this mission driving social change well into the future.