Global investments in fintech decreased from 62.3 to 51.9 billion dollars in six months. Venture capital is down in all key regions, but interest in AI is growing.
Fintech investment falls
Overall investment decline
According to KPMG's Pulse of Fintech report, global investment in fintech, including venture capital deals, private equity and M&A, has declined. Investments totaled $51.9 billion (2,255 deals) in the first half of 2024, compared to $62.3 billion (2,287 deals) in the second half of 2023.
Regional trends
Venture capital decreased in all major regions. In the Americas, they decreased from $38.5 to $36.7 billion, in the Asia-Pacific region - from $4.6 to $3.7 billion, and in Europe, the Middle East and Africa - from 19.1 to 11, 4 billion dollars. The decrease in deal value was partly due to a reduction in the number of large transactions as investors exercised caution.
Big deals and regional changes
During the first six months of 2024, there were only five fintech deals worth more than $1 billion in the world. The largest venture investment was the attraction of $999 million by the British company Abound. Interestingly, the number of deals increased in the Americas (from 1,066 to 1,123) and ASPAC (from 406 to 438), but decreased in the EMEA region (from 804 to 689).
Growing interest in AI
Despite the overall downturn, investors continue to show significant interest in AI technologies, particularly in the Americas. In the US, there were four major deals in this industry: the acquisition of Corvus by Travelers for $427 million, the purchase of Spiff by Salesforce for $419 million, and the venture funding of Ramp ($150 million) and FundGuard ($100 million).
Changes in various sectors
In the payments sector, $21.4 billion of investment was attracted in the first half of 2024, which is almost equal to the figure for the whole of 2023 ($22.7 billion). The regtech sector also showed growth - $5.3 billion compared to $3.4 billion in 2023. On the other hand, investments in insurtech decreased significantly - only 1.6 billion dollars in the first half of 2024 against 8.2 billion for the whole of 2023.
Future Forecasts
Fintech investment is expected to remain low due to high interest rates and the approaching presidential election in USA. The most active area for investment is likely to be artificial intelligence, as startups work to adapt AI solutions for the financial sector. There is optimism that the number of deals will increase, but their average size will likely remain small compared to historical figures.
Expert opinion
Yuriy Fedoriv, head of KPMG's financial services industry practice in Ukraine, notes: "The number of deals in the early stages thanks to interest in new technologies, such as artificial intelligence, and innovative business models. This reflects the global trends of decentralization and integration with ecosystem platforms. Ukrainian companies will probably also support this trend by actively implementing innovative solutions for their development."
Regional features of investments
In America, investments in fintech amounted to $36.7 billion, a slight decrease compared to the previous period. The US attracted $27.4 billion, while Canada reached a record $7.8 billion. Brazil received only $616 billion in investment.
The ASPAC region posted its lowest rate of investment growth since 2017, falling from $4.6 billion to $3.7 billion in the first half of the year. This is due to a decrease in the sums of concluded agreements.
In the EMEA region fintech financing fell by 40% - from 19 to 11.4 billion dollars. Great Britain remains the leader, attracting 7.3 billion dollars of investment.
It is worth noting that, according to KPMG forecasts, the world economy will experience a slight slowdown due to growing geopolitical tensions, but economic recovery is expected growth in 2025.
Glossary
- KPMG is an international network of firms providing auditing, tax and consulting services
- Fintech - financial technologies that use innovative solutions to provide financial services
- M&A - merger and acquisition of companies
- Regtech - technologies for compliance with regulatory requirements in the financial sector
- Insurtech - technological innovations in the insurance industry
Link
Share
Answers to questions
What is the general trend in global fintech investment over the last period?
Which fintech sectors are showing investment growth?
What are the fintech investment forecasts for the second half of 2024?
How have fintech investments changed in different regions of the world?
What trends are observed in venture financing of fintech projects?
Hashtags
Save a link to this article
Discussion of the topic – Global decline in fintech investment: 2024 trend analysis
The article analyzes the decline in global investment in fintech from $62.3 billion to $51.9 billion in the first half of 2024, based on the KPMG Pulse of Fintech report. Changes in venture capital investments in different regions of the world are considered.
There are no reviews for this product.
Write a comment
Your email address will not be published. Required fields are checked *