CrowdLending (Business) - Iceland

Iceland

Highlights

The Crowdlending (Business) market market in Iceland is projected to reach a total transaction value of US$1.21m in 2024.
When comparing this figure globally, it is evident that China leads with the highest transaction value, expected to reach US$16bn in 2024.
Iceland's CrowdLending market is experiencing a surge in capital raising activities, showcasing a growing investor interest in alternative financing solutions.

Key regions:

Market definitionIn-Scope/Out-of-scopeMarket structureReportsMethodology

The CrowdLending (Business) market in Iceland has been experiencing significant growth in recent years, driven by several key factors.

Customer preferences: In Iceland, businesses are increasingly turning to crowd lending as a source of financing due to its convenience and accessibility. This alternative financing option allows businesses to bypass traditional banks and connect directly with investors who are willing to lend money. The online platforms that facilitate crowd lending provide a user-friendly interface, making it easy for businesses to create loan listings and attract potential lenders. Additionally, the transparency and speed of the crowd lending process are appealing to businesses, as they can quickly secure the funding they need without the lengthy approval processes associated with traditional loans.

Trends in the market: One of the key trends in the CrowdLending (Business) market in Iceland is the rise of peer-to-peer lending platforms. These platforms connect individual investors with businesses in need of funding, creating a direct lending relationship. This trend has gained traction in Iceland due to the ease of use and potential for higher returns compared to traditional investment options. As a result, peer-to-peer lending platforms have seen a surge in popularity, with both businesses and investors embracing this new model of financing. Another trend in the market is the increasing diversification of crowd lending platforms. In addition to peer-to-peer lending, there has been a rise in platforms that specialize in specific industries or types of businesses. This allows businesses to find lenders who have a particular interest or expertise in their sector, increasing the likelihood of securing funding. Furthermore, these specialized platforms often provide additional support and resources tailored to the needs of specific industries, further enhancing their appeal to businesses.

Local special circumstances: Iceland's small and close-knit business community has played a significant role in the development of the CrowdLending (Business) market. The country's tight-knit business networks and strong entrepreneurial spirit have fostered an environment where crowd lending can thrive. Businesses in Iceland are often connected through personal relationships and word-of-mouth referrals, which has helped to build trust and confidence in the crowd lending process. Additionally, the relatively small size of the Icelandic market has created a sense of community among businesses and investors, making it easier for them to connect and collaborate through crowd lending platforms.

Underlying macroeconomic factors: The development of the CrowdLending (Business) market in Iceland is also influenced by the country's macroeconomic conditions. Iceland has experienced strong economic growth in recent years, driven by sectors such as tourism, renewable energy, and technology. This growth has created a demand for financing among businesses, particularly those in the emerging sectors. Traditional banks have often been cautious in lending to these sectors, creating an opportunity for crowd lending platforms to fill the gap. The favorable macroeconomic conditions, coupled with the ease of access to crowd lending platforms, have made it an attractive financing option for businesses in Iceland. In conclusion, the CrowdLending (Business) market in Iceland is experiencing growth due to customer preferences for convenience and accessibility, as well as the rise of peer-to-peer lending platforms and specialized platforms. The local special circumstances, such as the close-knit business community and strong entrepreneurial spirit, have also contributed to the development of the market. Furthermore, the favorable macroeconomic conditions in Iceland, driven by sectors such as tourism and renewable energy, have created a demand for alternative financing options like crowd lending.

Data coverage:

The data encompasses B2C enterprises. Figures are based on transaction values / revenues / assets under management and user data of relevant services and products offered within the FinTech market.

Modeling approach / Market size:

Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use annual financial reports of key players, industry reports, third-party reports, publicly available databases, and survey results from primary research (e.g., the Statista Global Consumer Survey). In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, consumer spending, population, internet penetration, smartphone penetration, credit card penetration, and online banking penetration. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the S-curve function and exponential trend smoothing are well suited for forecasting digital products and services due to the non-linear growth of technology adoption.

Additional notes:

The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic and the Russia-Ukraine war is considered at a country-specific level.