The financial technology industry is booming and many investors have noticed that. In that context, investment in fintech ventures in Singapore rose rapidly. The latest reports from Accenture confirm that in the first 9 months of the current year, investors in Singapore brought a record $735 million into financial-technology deals. That represents a 69% surge from the prior-year period that raked in $435 million.
Accenture came up with this data after analyzing reports from CB Insights, Pitchbook, and Tracxn. So far in 2019, the $735 million (S$1 billion) invested has surpassed the $642 million raised in all of 2018. The investments came in led by fundraising with payment startups and insurtech firms. Furthermore, investors also diversified toward the more mature companies.
Singapore’s fintech ecosystem has managed to gain high recognition from investors worldwide for its potential. It has also expanded and strengthened its interests in digital financial services in Singapore as well as in the wider region. These are the main ideas translated in the statement by Sopnendu Mohanty who is the chief fintech officer of the Monetary Authority of the country.
Sector Grows 600% since 2015
Singapore has remained active in investing in its fintech ecosystem for the last four years. These investments together with the annual Singapore Fintech Festival seem to be paying off. The city-state has enjoyed an almost 600% increase in the investments in this sector since 2015.
Mahanty said that it is quite encouraging to see several local startups finance their global growth from Singapore. Moreover, many global fintech companies that have regional headquarters in Singapore have in recent months raised considerable amounts of funds to support their Asian expansion.
Number of Deals Dropped
Amidst this phenomenal growth, the number of deals fell by about 29% in the first nine months of 2019. Compared to the prior-year period, deals fell from 133 in 2018 to 94 in 2019. The drop suggests that investors made larger bets into fewer deals as many startups grow their business.
Divyesh Vithlani, the senior at Accenture, explained the recent findings. As evident from other corners of the world, fundraising is changing to support the scaling up of the collaborative and challenger fintech.
The bulk of the fintech fundraising comprised of investments in payments startups and those in lending accounting for 34% and 20% of the total, respectively. Insurance technology deals accounted for approximately 17%.
The total value of the payment deals increased by113% to $251 million which has made it the major contributor to the total gains in 2019 so far. Also, lending rose by more than 50% to stand at $145 million.
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