Fintech Stocks Surge in 2025: SoFi Shines — What Investors Must Watch

Fintech investing in late 2025 is being driven by two converging factors: faster growth among digitally native financial services (especially those expanding user/product bases and non-interest/income streams), and improving profitability across more mature fintechs. The QED-BCG report confirms sector revenue growth (~21%) that far outpaces traditional banking (6%), and that nearly 70% of public fintechs are now profitable. [4]

Against that backdrop, the Insider Monkey methodology identifies fintechs with high hedge fund ownership as proxies for prospects favored by institutional investors. Their “14 most promising fintech stocks” list emphasizes metrics such as front-book momentum, margin expansion and pricing power, suggesting that those are key differentiators in an environment where cost discipline and sustainable growth are increasingly important. [1]

Case study: SoFi illustrates this trend. It achieved rapid member/product expansion (~34% YoY), strong margin improvement (Adjusted EBITDA margin ~29%), improving credit metrics, and fee-based revenue growing ~72%. It also raised full-year guidance on revenue, earnings and member adds, reflecting confidence in scaling across multiple products. [2]

By contrast, Grab’s solid revenue growth is offset by disappointment in guidance. Its full-year revenue and EBITDA projections missed expectations, showing that in emerging-markets fintechs, unit economics and margins can be pressured by costs, regulations, and weaker monetization. [3]

Strategic implications:

• Investors should favor fintechs with diversified revenue mixes (e.g. high proportion of fee-based or interchange income), strong user/product growth, and improving margins rather than those relying almost entirely on net interest income or high discount rate expectations.
• Valuation considerations are becoming central; lenders and fintechs whose path to ROTCE (return on tangible common equity) is ambiguous face downgrades despite revenue growth. SoFi itself is viewed with some skepticism over long-term ROTCE targets. [5]
• Geographic diversification presents both upside (e.g., Latin America) and risk (FX, regulatory); growth stories like Nu Holdings are appealing, but carry macro risk. [2]

Open questions:

• Can fintechs continue improving credit performance and controlling losses in a rising rates environment?
• What is the tipping point for regulatory risk—particularly as fintechs take on more bank-like functions (deposits, lending) and increasingly touch consumer data?
• Which segments (BNPL, digital banking, embedded finance, crypto-adjacent) will emerge fastest in profitability vs scale; and among those, which are most susceptible to disruption or margin compression?