Back to blog

Fintech Model Options for Business: A Comprehensive Guide


10 min read

The fintech business model is a pillar of how your business works and moves towards its goals. This detailed strategy identifies how to gain more revenue, enhance productivity, and increase the profits.

Fintech business models are important for both fintech startups and established businesses. For the latter, regular check-ups and updates can make your company future proof.

Since business strategy is mindful, it has numerous options for company owners to pick for themselves. In this article, we will discuss those options and how to choose the right one for your business.

What is Business Strategy

First, let’s clarify the fintech business model. Simply put, it’s the company’s plan for earning and enhancing profits. This profit generation strategy usually incorporates the following components:

  • products/services identification,
  • target audience definition,
  • prior expenses calculation.

Altogether, these parts at the focus of the business will help you pilot the ship in the right direction. So, if you’re looking to invest in someone’s business or carry out your startup idea for the fintech market, we’re here to tell you more about the various business models and their distinguishing peculiarities.

In the meantime, if you’re an established business already, you can conduct the occasional check-up that is mandatory to not to lose track of your client. So, to remain competitive and forecast the possible risks, you should navigate wisely, i.e. regularly scrutinize the correlation with your business plans. To do this effectively, recollect another concept of the business model of fintech companies, ‘financial cube,’ which expresses the tight interplay between technology, the financial services industry, and the business model. In other words, make sure that you bring exclusive value to the chosen financial sector through the specific technological solution that disrupts the market with innovation and makes a profit on that.

If the last utterance refers to your business, it means that you’ve chosen the business fintech model appropriately. If you have any doubts, go on with reading this article till the end.

Business Models Classification By O’Hanlon & Chishti

DashDevs recognized the business models typology offered by Steven O’Hanlon (CEO of Numerix) and Susanne Chishti (CEO of FINTECH Circle) in their book Fintech for Dummies (2020). This classification of fintech revenue models is a useful reference source for both established and fledgling fintech and insurance companies, and even financial institutions. So, have a look at the condensed overview of business models below:

  • B2B — business-to-business — solutions to banks and SaaS platforms;
  • B2C — business-to-consumer — services for neobanks, digital investment providers, cash and wealth management apps, and other end-users;
  • B2B2C — business-to-business-to-consumer — simultaneous fintech aid for small businesses and their customers;
  • B2G — business-to-government/regulator — solving tech challenges for governmental institutions;
  • P2P — peer-to-peer lending — mutual borrow-loaning interests satisfaction between the two parties;
  • crowdfunding — investment into the particular project after gathering the required sum of money from the large group of involved participants;
  • platform-based/multi-sided — for start-ups and existing businesses; has its subdivisions, but we’ll dwell on transaction subtype mostly.

And now let’s review each fintech operating model one by one for you to draw the clear demarcation line between them and make the correct choice for your exact project. Step forward!

B2B Model

In brief, the B2B fintech financial model presupposes the provision of services/products for the needs of enterprises or organizations (corporate sales). In this case, the vendors make their buying decisions from the position of business development rather than personal benefit, interest, or satisfaction (like in B2C). This kind of partnership between 2 businesses in the financial sphere goes first with adding some innovative tech elements to traditional banking. As a result, it’s a win-win relationship for both of them: one successfully trades and earns, while the other strengthens its position in the market, retains the clientele, and gets or even increases its revenue.

The growth of digitalization is trodding the path from fintech payments business model and BaaS nucleus to the expansion into lending, e-commerce, real estate, privacy, anti-fraud security, risk management, etc. For the record, the ones who exhibit confident performance these days are Onfido and Chaser. The former touts as an excellent AI-based identity security service with powerful onboarding for its clients: they mind both your UX and fraud risk prevention. The latter is famous for its freemium model tactic, which invites customers to the free demo tools, such as invoice payment reminders, credit control, and debt collection, and evokes their loyalty in turn. So, as you see, the fintech players’ portraits in B2B have undergone a crucial transformation.

B2C Model

In contrast to the previous business model, B2C is targeted to provide products or services to end-users, the specific individuals, or small businesses directly. In this case, the service provider is supposed to work out the custom-tailored approach and ensure the price affordability for the ultimate user; otherwise, they won’t succeed in stifling the competition. When shaping the B2C fintech business model canvas, remember that personal usage is the core reason for purchase and act accordingly for the client not to have the ‘why you’ question.

In the realm of fintech, B2C works best for neobanks, digital platforms specialized in investment and wealth management, and apps for payment and personal finance supervision. To put it simply, this business model is the perfect fit for banking under the condition of no physical representation available, and 42% of digital banks are already working tightly with different types of fintechs.

For instance, such notorious cash apps like Google Pay and Apple Pay have taken over the world with their swift money transfer optimization stemming from the Internet and mobile tech merging. At the same time, the budgeting app Mint indoctrinates its users to manage their money efficiently and be good at savings and late fees avoidance. The other notable B2C fintech incumbent is Dozens — the top UK digital banking with the impressive 5% interest rate, convenient money sending options, well-thought investment feature, and split payment function.

B2B2C Model

Generally, B2B2C serves as the linking juncture between the individuals with projects (on the stage of development or in a very raw state) and the interested investors or institutions. This fintech financial model is easily confused with crowdfunding as they have much in common in terms of external sponsorship. But with the B2B2C, the investment may come from only one financial donor. Why does this business model make a splash in the fintech area? The reasons include the following:

  • Relatively quick product/service scalability at low cost;
  • Access to the large customer base interested in the long-term relationship;
  • An excellent alternative to expensive lead generation business strategies.

Considering these advantages, you should be certain of the B2B2C cooperation in the underserved marketplace. What matters the most in fintech pricing models like this is the suitable engagement strategy. However, if funneling money is smart, this kind of synergy between startups and benefactors can seriously topple the existing competitors. The compelling evidence for this statement is brought by the example of Plastyc and H&R Block partnership, where the former has turned into a trusted brand with a 3.4 million customer base, while the latter has become a high-powered banking solution with a direct deposit function. Another successful B2B2C collaboration case is SaveUp and Bank of the West that provided the consumers’ with an opportunity to easily supervise their savings via their individual and business bank account.

B2G Model

By shifting the ultimate recipient to the public sector, the fintech companies offer profitable bargains to them. This signifies that some governmental organizations are seeking fintech assistance to make their operations smoother, quicker, and less costly. Moreover, B2G can be used as model risk management in fintech. It usually kills two birds with one stone: except for cutting the expenses, they acquire wider audience coverage because of being disruptive and up-to-date with their tech solutions for the users. Lately, the trend of making this kind of commercial unity is widely seen in the tax payment and file reports directions. However, the lines of business activities suitable for B2G are constantly broadening.

In particular, the most well-known B2G examples that finally vindicated their good name are

  • Senseware (a real-time IoT kit for assets digitalization, cloud storage, and data collection),
  • SmartProcure (an online purchase history database operating at the country level),
  • and OpenGov (an integrated cloud tool for budgeting, reporting, and citizen services).

All of them are of US origin, which appears to be the fruitful ground for government and business collaboration ties.

P2P Model

Peer-to-peer (P2P) lending is the type of give-and-take business model that bridges borrowers and investors. The notable hallmark of this liaison is the speed of credit financing; the borrower quickly gains the financial resources at their disposal, whereas the lender has an opportunity to invest the money wisely and get a solid ROI.

So, another part of the dichotomy is the higher profit rate compared to the debt markets. The latter can be calculated in various ways, depending on the chosen revenue strategy. Specifically, the most popular pay-it-back methods include the fixed service fees, the prescribed charge percentage, or the interest repayment. Everything is entirely up to the applicant’s solvency.

Usually, P2P cooperation takes place on the specific platforms that match the two involved parties together and guarantee the safety of their further operations. In this regard, it’s relevant to mention Zopa, the P2P lending pioneer in the UK, and Prosper, its counterpart, functioning in the US market. By coincidence, both companies were established in 2005. And what’s more, they’re still globally reputable in the P2P circles owing to their transaction security, skillful demands and offer matchmaking algorithms, large customer bases, and proficient users’ data storage.

Crowdfunding Model

We’ve already recollected crowdfunding before, comparing it to the B2B2C business model, and now let’s have a closer look at it. It’s a form of collective investment into the definite product/project with the belief of its further success after launching and presenting it to the public. As a rule, this process occurs within the Internet setting, on specially built platforms like Kickstarter, which charge a set percentage fee from the total revenue. Nonetheless, the exact monetization plan depends on the type of crowdfunding business model. Namely, there are 4 subtypes:

  • Donation — a generous act of investing in someone’s business idea without waiting for profit or any kind of backlash;
  • Sharing — you appear to be one of the company’s shareholders as a result of investing in the project at the early stage of production;
  • Revenue focus — another form of investment that emphasizes the sponsor’s incentive to gain part of the company’s future profit;
  • Debt — lending a certain sum of money for someone to let their business roll out and get your credit back in a fixed period.

This business model is likely to exist for amateur enthusiasts who believe in themselves and bring their business ideas to life, even the craziest ones. What would the world be without such a lucky chance? In this connection, you need to review the auspicious crowdfunding cases, such as the following:

  • Seedrs (a famous European crowdfunding website with an extensive educational library on money-raising and investment),
  • Crowdcube (an international crowdfunding provider for your secure shares buying),
  • Downing (a UK-based investment platform specializing in venture capital trusts and entrepreneurial funding).

By the way, the last in the row is the pride of DashDevs as we’ve taken an active part in developing this platform.

Platform-Based Model

This type of business model is the most complicated one because of its division into 10+ main subcategories. However, examining the implementation of the different business models in the fintech marketplace specifically, we’ll stay focused on the most relevant platform-based subtype — the transaction business model.

It’s acute for different requests: from the startups and young companies, allowing them to grow up like mushrooms, to the established businesses that are eager to integrate the new tech instruments/solutions into the functioning system.

You know about the online payments system Paypal, which can be viewed as the platform-based transaction business model. Its international gravitas is believed to be gained through the 2 main tactics:

  • accelerating early demand (the company provides a one-time $10 bonus for any newbie and a regular $10 bonus for each reference you turn into the new Paypal user)
  • piggy-backing onto the existing network (the cooperation with eBay in the early days of the company’s development).

The other prominent platform-based business model cases at the fintech arena are narrowly focused on Plaid, Salt Edge, and Clear Bank. The first two are about open banking, and the last one relates to the pure transaction platform example.


While racking your brain on this question, you need to go back to the definition of the financial cube. In other words, your ultimate decision will be determined by the interplay of 3 factors

  • the financial sector you’re operating/aspiring to enter,
  • the technology you’re presenting to the fintech marketplace,
  • the method of profit-making.

If you’re a starting business, better think carefully about P2P lending and crowdfunding or ask for B2C assistance or B2B cooperation with you as the end-user. In case you’re an established project, B2B is the most appropriate business model for you, but you can also be helpful as the B2G player or the B2B2C nexus.

And finally, the multi-platform option is good for both types of businesses. If you still have some hesitation and are willing to get our professional advice, feel free to contact DashDevs, and we’ll come up with the best solution exactly for your needs! We will help you with fintech ecosystem business models, investment decisions and challenges.


How do you build a successful fintech?

First of all, you should remember what a fintech business model is and how it is meant to contribute to your business. Then, after you choose the right one for your company, ensure that you have a good technical strategy. With the precise knowledge of your business, you’ll be able to get the best from both world, incorporating the software into your business model and strategy,

What are the fintech business models?

It is a pillar of how your business works and moves towards its goals. This detailed strategy identifies how to gain more revenue, enhance productivity, and increase the profits. To put it in even more simplified terms, the business model defines how your company makes profits.

Share article

Table of contents