ASCHEIM, Germany–Credit unions are frequently told that financial technology (fintech) companies are going to change the competitive landscape–or at least change how the market sees the
future.
A fintech here that has just 5% of the revenue of Germany’s biggest bank, Deutsche Bank AG, is now worth more than the bank itself in terms of market capitalization.
Wirecard AG overtook Germany’s biggest bank in market value earlier this week, part of a wave of investor enthusiasm for payments companies. The stock, which has climbed by more than 84% this year, is set to join the country’s benchmark DAX index next month, possibly at the expense Commerzbank AG, according to Bloomberg.
Wirecard’s growth mirrors the success of Adyen NV, a European-based payments startup whose shares have more than doubled since their debut in June, Bloomberg added.
“Payments companies are popular with investors because they can profit from the rapid global growth of online commerce and the use of mobile devices for banking -- without having to bear the costs of providing and managing long-term credit to the economy,” the report stated.
The 19-year-old Wirecard, whose market value stands at about 21.1 billion euros ($24.1 billion), provides software and systems for online payments and fraud prevention.