Global fintech start-up funding falls by 20% to $8.8bln

      Published on Wednesday, 26 August , 2020      632 Views     
Global fintech start-up funding falls by 20% to $8.8bln

  • Business

While 2018 saw record funding levels for the fintech sector, new data suggests that the global pandemic has led to a significant decrease in overall venture capital deals this year.

ForexSchoolOnline.com said that fintech startups raised $8.8 billion in the first half of 2020, marking a 20 percent fall year-on-year. Citing data from CrunchBase, the platform said that the leading investors were Techstarts, Y Combinator and 500 Startups.





There were significant funding challenges for fintechs already prior to the outbreak of Covid-19, as many investors were focusing on established companies with clear business models instead of early-stage businesses.

In Q1 2020, fintechs raised $4.6 billion globally, the same amount as in Q1 2019, but Q2 of 2020 saw a negative trend, with $4.3 billion raised, a 36 percent decrease year-on-year.

The highest performing year for fintech investment was 2018, when $33.6 billion in total was raised, followed by $25.4 billion in 2019. The total raised since 2015 had reached $114.7 billion by the end of H1 2020.

THE BIGGEST PLAYERS

CrunchBase’s data also showed that Techstars is the most active investor in the fintech market, with 183 funding rounds to its name. Y Combinator took part in 164 rounds and 500 Startups in 140 funding rounds, followed by Plug and Play, QED Investors, and Anthemis Group.

North America received the most funding for fintech startups at $44.1 billion, with 95 percent of it going to the US. Asia was the second highest region with $51.3 billion in investments, while European fintech startups received $15.1 billion.

THE MIDDLE EAST MARKET

Despite the difficult conditions in the second quarter of 2020, Saudi Arabia’s fintech sector expanded as the country goes through a pivotal period, Middle East start-up platform MAGNiTT said. The number of active fintech start-ups increased by 147 percent year on year to 60 active companies in total.

Funding has also increased across the wider MENA region, said MAGNiTT, with overall funds raised reaching $659 million in H1 2020, an increase of 35 percent over 2019.

The fintech sector received the highest proportion of funding for the third year in a row at 16 percent of the total amount.

Reporting by Imogen Lillywhite



 


Keywords:
Category Business | 2020/08/26 latest update at 12:50 PM
Source : Zawya | Photocredit : Google
633 Views
Comments Add comment



Gulf Media

Related Articles

The editorial staff of Qatar Today would like to give all of its readers from Gulf and Qatar and the whole world the opportunity to participate actively in the development of the website! If you have something interesting, fun, scandalous - just something worth to be seen from more people. Capture it and share it in the Qatar Today with a short text.

Do you have information you want to reach our readers?

Send article/s

You can subscribe to our Facebook, Twitter and Google pages or use our RSS feed channel to always read the most important news about Qatar, the Gulf and the world.