Asia Pacific experiences the largest year-on-year decline in fintech funding, while global landscape shows promising signs with certain regions and segments experiencing growth, according to data from S&P Global Market Intelligence. Late-stage investing is on the rise, and there’s anticipation of fintech companies going public in the coming years.
16 April 2024 – In the first quarter of 2024, Asia Pacific witnessed the largest year-on-year decline in fintech funding value compared to other regions, plummeting by 46% to US$1.85 billion ($2.51 billion), according to data compiled by S&P Global Market Intelligence. This stark decrease is primarily attributed to the base effect, as indicated by the firm’s findings.
Globally, fintech startups engaged in 529 funding rounds totaling US$6.58 billion in the first quarter of 2024, marking an 18% decrease in round count and a 26% decline in dollar value year-on-year. Despite this, compared to the previous quarter, fintech funding value remained steady, while deal count grew by 13% year-on-year.
While North America and EMEA (Europe, the Middle East, and Africa) attracted over US$2.1 billion each, registering year-on-year declines of 26% and 10%, respectively, Latin America saw a doubling of its dollar value of investments to just under US$500 million.
According to Sampath Sharma Nariyuri, fintech research analyst at S&P Global Market Intelligence, the fintech funding landscape in 2024 shows promising signs, with certain regions and segments experiencing growth. Nariyuri anticipates a growth in funding during the latter half of 2024, buoyed by strong public market valuations of fintech companies.
Late-stage investing witnessed an uptick in the quarter, partly aided by increased participation of private equity firms. Nariyuri highlights the likelihood of several fintechs completing late-stage rounds and potentially going public from the second half of 2024 to late 2026, should the current cycle of interest rate tightening reverse.
In terms of segments, the banking technology segment saw a decent quarter, securing US$1.86 billion from 72 deals in the first quarter of 2024, up from US$1.7 billion from 62 deals in the same period last year. Meanwhile, payments attracted US$1.41 billion from 127 rounds, down from US$3.5 billion from 151 rounds during the same period last year. – ref: The Edge
