The crisis suffered by several US banks at the beginning of 2023 has put a brake on investors.
The global uncertainty linked with macroeconomic factors such as high inflation, rising interest rates, geopolitical tensions, among other reasons, severely affected the financing of fintech.
The first 6 months of 2023 were difficult for the global fintech market since both the total financing and the number of operations fell from u$s63,200 million and 2,885 operations in the second half of 2022 to u$s52,400 million and u$s2,153 operations in the first half of 2023.
It is also likely that the crisis suffered by several US banks at the beginning of 2023 has put a brake on investors.
But it was not all bad news. According to KPMG’s “Pulse of Fintech” publication, several sectors attracted considerable funding in the first half of the year. Supply chain-focused fintechssupply and logistics they secured funding of $8.2bn in the period, well above the 2019 annual record of $5.5bn.
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“We were not surprised that fintech financing decreased in the first 6 months of 2023, due to the difficulties faced by the market at that time,” said Judd Caplain, KPMG Global Head of Financial Services. “However, the long-term opportunity for various subsectors of fintech It remains sizeable, especially for sectors like payments, insurtech, and wealthtech. It is likely that once market conditions start to even out, funding will pick up, although not to the record level of 2021,” he added.
For his part, Fernando Quiroga Lafargue, KPMG Argentina’s leading partner of Financial Services, explained in relation to the local market: “In Argentina we have seen the global situation that impacted the investments with the addition of the uncertainty of the local scenario. Even within this framework we continue to see open channels of investment, although increasingly selective. Locally, the industry is optimistic regarding the evolution of financing options for the future”
Fintech: key data revealed by the report
- USA is responsible for most of the financing of the fintech in the first half of 2023 with US$34.9 billion, which represented more than two-thirds of the US$52.4 billion registered worldwide.
- Payments continue to attract much of fintech funding to global level during the first half of 2023, with US$16.2 billion.
- One well-positioned area that may attract investment in the second half of 2023 is artificial intelligence as companies try to harness the potential as part of efforts to improve both the operational efficiency as customer value.
Source: Ambito
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