The new fintech moat is ‘boring’
- What does a fintech moat look like today?
- The new measure of a fintech moat is the capability to handle complexity without pushing the burden onto customers or costs. It isn’t only about keeping competitors out but it's also about getting better as the system gets more complicated.
The ‘Letter from the Editor’ series features exclusive insight and opinion-driven analysis from Tearsheet editor Sara Khairi. The focus is on linking ideas, questioning assumptions, and tracking shifts across both mature and emerging trends in financial services.
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Issue # 12
Does revenue double while costs, headcount, and operational complexity rise with it? Or does the business actually get better as it gets bigger, more data to work with, more automation, better risk decisions, lower unit costs, and deeper customer integration?
I think that’s becoming a more useful way to think about fintech moats. I’m now looking for defensibility in operating leverage: the ability to grow more customers, transactions, and complexity without absorbing the same amount of cost.
This story lives in reconciliation, fraud controls, underwriting, routing, settlement, data infrastructure, and the workflows nobody puts on a product launch page. The new fintech moat is “boring,” and boring is what actually makes it durable. Let’s unpack how.
The numbers are telling us the same
The industry’s financial performance is increasingly rewarding operating leverage alongside growth. BCG and QED Investors’ 2026 fintech research found that global fintech revenue reached $504 billion in 2025, growing 22%, while 74% of the largest public fintechs were profitable and average EBITDA margins rose 400 basis points to 20%. The industry is moving toward profitable scale, with technology increasingly being judged by the economics it creates rather than simply the growth it enables.
So, what happens to your economics when you grow?
Adyen offers a good example. In 2025, its processed volume grew 21%, excluding a large-volume customer, while net revenue grew 18% and operating expenses rose just 13%. EBITDA increased 26%, pushing its margin to 53% from 50% a year earlier. Adyen attributed the expansion to the scalability of its single platform and the operating leverage it creates as the business grows.
If a fintech adds customers and volume but has to add people, systems, and operating expense at roughly the same pace, scale doesn’t create much of a moat. On the other hand, if more volume makes the data better, automation more effective, and unit economics stronger, scale starts to compound.
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