25 Mar 2022
Fintech report

The untapped potential for Fintech companies to serve small and medium-sized enterprises

By Hanne Kaerhoeg

EY EMEIA Financial Services Markets Leader

Focused on building and delivering client transformation for financial services businesses. Keen advocate for DE&I and the role of women in technology. Mother of three. Loves running and hiking.

25 Mar 2022

Digitalization accelerated by the pandemic has created a fertile ground for Fintechs and SMEs to form mutually beneficial partnerships.

In brief: 
  • Despite growing digitalization, Nordic SMEs find themselves grappling with administrative tasks that steal time better spent on impactful customer-centric work.
  • Fintech solutions allow the automation of time-intensive administrative tasks, enabling SMEs to focus on their customers and offer better services.
  • Educating SMEs on Fintech and Fintech on SMEs creates a fertile ground for them to form mutually beneficial partnerships that drive stronger customer value. 

With the world of business growing agile and digital, the opportunities for growth seem endless. Being able to execute your strategy to provide customer value is of the highest importance in today’s highly competitive business environment.

This statement cannot be truer for small and medium-sized enterprises (SMEs) in the Nordics. However, despite the push towards digitalization, we see many Nordic SME owners getting overwhelmed with administrative tasks after starting their business. This leaves them with little to no time to focus on customer relationships or innovation.

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OECD statistics


of all businesses in the EU are small and medium-sized enterprises (SMEs)

An overview of the Nordic ecosystem

The most significant accelerator of digitalization and adoption of Fintech solutions has been the COVID-19 pandemic. We are really starting to see a rapid uptake of many different solutions targeting the very specific needs of SMEs. This provides fertile ground for an explosion of Fintech innovation across all components of the financial value chain.

The Nordics are set up to hold a strong competitive advantage in regard to Fintech and SME collaboration. The reasons are many:

  • Highly digitized societies and financial infrastructure
  • Easy access to public data
  • Open banking (PSD2) being implemented by all Nordic banks
  • Widespread adoption of cloud accounting systems (ERP) in the Nordics
Fintech tools bring significant benefits for small and medium-sized companies. With a history of being underserved with financial services, SMEs represent low-hanging fruits that are key targets for a large segment of fintech solutions.
Thomas Krogh Jensen
CEO, Copenhagen FinTech

Together with EY, The Nordic fintech hubs, Copenhagen FinTech (Denmark), NCE Finance Innovation (Norway), Helsinki FinTech Farm (Finland), The FinTech Cluster (Iceland) and Invest Stockholm (Sweden) have worked on a report to map out the FinTech companies in their respective countries that work with direct value propositions for SMEs.

Many observations relevant to the Nordic fintech community have been identified and are described in this report.

Mapping of fintechs in the Nordics

Regardless of whether you are a fintech or a small or medium-sized company, it is imperative that you understand your business landscape and explore how you can obtain greater value by entering into partnerships. To support this understanding, we have conducted an extensive mapping of interesting players in this space in the Nordics.

Nordic fintechs


Fintech companies have been mapped out in the Nordics, covering eight main themes

By analyzing the Nordic fintech sector and SME value propositions, we identified eight main themes. These themes showcase subcategories where fintech companies can simplify the daily lives of SMEs:

1.   Accounting and payroll

For micro and small companies that do not have a dedicated finance department or person, accounting and payroll become very demanding if not simplified and automated. Around 90 fintech companies in the Nordics work on simplifying payroll and creating new innovative payroll solutions. These solutions enable employees to receive pay on demand, rather than at the end of the month.

2.   Compliance and cyber security

New legislations can generate more administrative tasks, which might make it more difficult for SMEs that do not have big budgets or in-house experts to tackle them. A subset of fintech companies called RegTech – short for “regulatory technology” – works on improving the compliance and cyber security space every day. Their expertise can be leveraged by SMEs.

3.   Employee benefits

Many fintech companies focus on how SMEs can help their own employees’ finances, flexibility and work-life balance. This focus is crucial for SMEs to stay competitive in attracting talent, compared to larger enterprises. For example, it is often not possible for small businesses to get the same pension solutions as larger enterprises. Instead, they can incentivize people who work on hourly wages to work more shifts using payroll systems.

4.   Digital banking

Digital banking is a classic fintech category. It is an increasingly important theme for SMEs that may have difficulties opening a business bank account at a larger, well-established financial institution. Digital banks that focus on helping SMEs have been growing significantly, giving SMEs access to the financial support they might not receive at a regular bank.

5.   Financing, liquidity and investments

This category focuses on how companies stay liquid to survive, or how alternative financing can be raised through methods such as crowdfunding and crowdlending. Liquidity ensures that a small or medium sized company stays alive despite being in situations where customers are unable to pay on time, increasing the risk of the SME not being able to pay salaries, rent, etc.

6.   Payments

For Nordic countries that have almost-cashless societies, payments may seem like a simple area to tackle. But underneath all the smooth and simple user interfaces, vast complexity is interwoven through the whole infrastructure and value chain of payments systems. The payments category, therefore, includes any fintech company helping SMEs with payments.

7.   Data analytics provider

Data analytics matters for SMEs, both in their early stages as well as when they decide to scale. Being aware of changes in internal business metrics in real-time and over time will make it easier for your organization to adapt when needed. Hence this is another area where fintech companies can add greater value to SMEs.

8.   Business solutions and platforms

From marketplaces to management platforms, fintech can enable an array of business solutions that aid the everyday functioning of SMEs. Examples include platforms that help manage end-to-end B2B customer lifecycle, marketplaces that connect customers to various stores and platforms that support project and finance management.

Driving SME technology integration

The EY Global Fintech Adoption Index of 2019 showed that 25% of SMEs have adopted fintech globally, due to the good range of functionality and ease of use. SMEs that have integrated technology into their business processes are aware of its costs and benefits. They are aware that the integration of disruptive technologies such as artificial intelligence (AI) and cloud computing can enable new services and capabilities.

Global Fintech Adoption Index of 2019


of SMEs have adopted FinTech globally

Technology integration can be enhanced by increasing SME awareness of fintech and the range of services they offer. Five fintech interviews were conducted by EY in the Nordics to showcase how the integration of technology can drive SMEs toward growth.

The five fintechs selected for the case studies were Salary (Denmark), Bokio (Sweden), Strise (Norway), Calqulate (Finland), and Igloo (Iceland). The services offered by them include tools for online bookkeeping, payroll management, human resource administration, data and analytics, and business solutions.

The five case studies are featured in the report, each featuring observations relevant to both fintech and SMEs. General aspects of relevance to be considered by actors in the space have also been outlined in the case studies.

Future perspectives

As SMEs are still underserved in regard to financial services, the market has a high potential for growth in the future. One area of growth is banking services tailored for SMEs.

As seen in the mapping, digital banking may not be the subsector with the largest quantity of fintech, but since all SMEs need bank accounts and would like access to financial services, specializing in this market may be advantageous for those who manage to create the highest value banking services to SMEs. We also see other trends emerging. Climate change and ESG reporting is an area of focus for all companies, including SMEs.

The opportunities are seemingly endless. But one thing is clear. The power that fintech companies have to empower SMEs go beyond the realms of routine money lending. Administrative time saved with fluid automation through fintech enables SMEs to focus more on their clients directly, resulting in better and often cheaper services.

The right fintech-SME partnerships will foster fertile ground for entrepreneurial growth and a thriving business ecosystem. Helping SMEs focus more on their product quality and their customers will, in the end, serve all of us.


Despite forming 99% of all businesses in the EU, small and medium-sized enterprises (SMEs) remain underserved in terms of financial services. The integration of technology into SMEs in the Nordics has a high potential for future growth and offers an opportunity that Fintechs can tap into.

Solutions offered by fintech companies allow SMEs to focus on providing their services to their customers and improving their business. Helping SMEs focus more on their product quality and their customers will, in the end, serve us all. 

About this article

By Hanne Kaerhoeg

EY EMEIA Financial Services Markets Leader

Focused on building and delivering client transformation for financial services businesses. Keen advocate for DE&I and the role of women in technology. Mother of three. Loves running and hiking.