Global Fintech Investment Dips To $95.6 Billion In 2024
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KPMG’s bi-annual Pulse of Fintech report reveals a challenging landscape for the global fintech sector in H2’24, with both investment levels and deal counts dropping to figures last seen in 2017. Over the past year, global fintech investment amounted to just $95.6 billion spread over 4,639 deals.
A mix of macroeconomic headwinds, geopolitical tensions, election cycles in key regions, and worries about overvaluations and limited exit opportunities have dampened investor enthusiasm.
Fintech Investment Declines But Shows Signs Of Recovery
The latter half of the year was especially slow, with investments declining from $51.7 billion in H1’24 to $43.9 billion in H2’24. However, there was a bright spot: between Q3’24 and Q4’24, global fintech investment increased from $18 billion to $25.9 billion. Additionally, M&A deal values and VC investments also rising—M&A from $7.4 billion to $14.2 billion and VC from $9.7 billion to $11.2 billion.
Regionally, the Americas led the charge, attracting $63.8 billion across 2,267 deals, including $50.7 billion from 1,836 deals in the US. The EMEA region followed with $20.3 billion over 1,465 deals, while the APAC region secured $11.4 billion across 896 deals.
In terms of sectors, payments dominated with $31 billion, followed by digital assets and currencies at $9.1 billion, and regtech at $7.4 billion.
Karim Haji, Global Head of Financial Services at KPMG International, said that the year have been really tough for nearly everyone, including VC, corporates, fintechs, and PE firms. This results from the challenges and uncertainties in the global market.
With only a handful of exceptions, no one wanted to pull the trigger on the largest deals, which have long been a mainstay in fintech investment.
He added that there is reason for optimism as 2025 approaches, with major elections now behind us and a resurgence in investment and deal activity fueled by interest rate cuts and lower funding costs. However, he cautioned that it remains to be seen how evolving global trading conditions will impact inflation and interest rates.
Digital Assets, AI, And Regtech Sets To Strengthen Fintech Investment
Looking ahead, while payments are expected to continue dominating global fintech investment, digital assets and currencies appear well-positioned for a turnaround. Additionally, AI is anticipated to be a major area of interest for investors, with regtech and cybersecurity likely drawing significant attention in H1’25.
Anton Ruddenklau, Lead of Global Innovation and Fintech for Financial Services at KPMG International, said artificial intelligence has the potential to grow in fintech investment. He noted that trends in the broader investment space suggested its increasing influence.
However, he said it was still early, with strong interest in AI, generative AI, agentic AI, and automation, but also a sense of caution.
He stated that in the coming year, AI-focused regtech firms were likely to gain the most attention from investors as financial services companies looked for better ways to manage an increasingly complex regulatory environment.
