2024 was another difficult year for fintech, with just $95,6-billion of investment globally across 4 639 deals.
Both global fintech investment and the number of deals fell to levels not seen since 2017, according to the Pulse of Fintech H2’24, a bi-annual report published by KPMG that highlights fintech investment trends globally and in key jurisdictions around the world.
The report is based on data provided by PitchBook Data Inc. A perfect storm of factors combined to soften investor appetite, including macroeconomic challenges, geopolitical conflicts and tensions, a year of elections in major jurisdictions, and concerns about valuations and the lack of exits.
The second half of the year was notably slower than the first, with investment falling from $51,7-billion in H1’24 to $43,9-billion in H2’24. A closer look at the results offered some optimism, however; between Q3’24 and Q4’24, global fintech investment rose from $18-billion to $25,9-billion. Both M&A deal value and VC investment also rose quarter-over-quarter, from $7,4-billion to $14,2-billion and from $9,7-billion to $11,2-billion, respectively.
Regionally, the Americas attracted the largest share of fintech investment in 2024, with $63,8-billion across 2 267 deals, including $50,7-billion across 1 836 deals in the US. The EMEA region attracted $20,3-billion across 1 465 deals, while the ASPAC region saw $11,4-billion across 896 deals. At a sector level, the payments space attracted the largest share of investment ($31-billion), followed by digital assets and currencies ($9,1-billion), and regtech ($7,4-billion).
“It’s been a rough year for nearly everyone — fintechs, corporates, VC and PE firms — given the breadth of 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,” says Karim Haji, global head of financial services at KPMG International.
“But there’s a lot to be positive about heading into 2025. Many critical elections are behind us and investment and deal activity is beginning to pick up. We are starting to see more deals coming through because of interest rate cuts in different jurisdictions and the lower cost of funding.
“However, we will have to wait and see if the changing world trading conditions impact inflation, interest rates and consequently these positive signs of market change.”
Payments attract largest fintech tickets
The payments sector continued to drive the largest share of fintech funding globally in 2024, accounting for $31-billion in investment — up from $17,2-billion in 2023.
A large share of this investment was driven by consolidation and defensive plays rather than by companies looking to scale, including the two largest deals of the year — the $12,5-billion buyout of a majority stake in US-based Worldpay by GRCR in H1’24 and the $6,3-billion take private of Canada-based Nuvei by PE firm Advent International in H2’24.
In addition to the Nuvei deal, H2’24 saw several other sizeable payments deals, including the $1,6-billion acquisition of US-based Transact Campus by Roper Technologies and a $788-million VC raise by Philippines-based Mynt.
Digital assets and currencies see a resurgence
The digital assets and currencies space attracted $9,1-billion in investment globally in 2024 — the highest total ever outside of the outlier years of 2022 and 2023.
A large share of this investment focused on digital market infrastructure, tokens, and digital assets.
During H2’24, four of the five largest deals occurred in the Americas, including Stripe’s $1,1-billion acquisition of stablecoin infrastructure company Bridge, a $525-million raise by Praxis, and a $200-million raise by Current — all based in the US — and a $210-million raise by Canada-based Blockstream.
A $100-million raise by UK-based Crytocoin accounted for the largest deal in the EMEA region, while an $80-million raise by Singapore-based Partior was the largest deal in ASPAC.
With the new US administration expected to be crypto friendly, it is likely the digital assets and currencies will continue to see increasing interest and investment heading into 2025.
Americas sees VC investment drop
The Americas saw total fintech investment drop from $77,6-billion in 2023 to a six-year low of $63,8-billion in 2024.
The US accounted for $50,7-billion of this funding — a decline from $72,8-billion in 2023.
Outside of the US, Canada saw a record high of $9,5-billion in fintech investment during 2024 — driven in large part by the buyout of Nuvei — while investment in Brazil softened from $2,3-billion to $1,4-billion. Fintech investment dropped slightly from $32,8-billion to $31-billion between H1’24 and H2’24.
On a more positive note, investment almost doubled between Q3’24 and Q4’24, rising from $10,8-billion to $20,2-billion.
Within the US, fintech investment dropped from $28,8-billion to $21,9-billion between H1’24 and H2’24, although it also rose from $9,9-billion to $11,9-billion between Q3’24 and Q4’24.
Fintech investment in EMEA region drops
Fintech investment in the EMEA region fell from $27,6-billion across 1 833 deals in 2023 to just $20,3-billion across 1 465 deals in 2024. H2’24 also saw a significant drop compared to H1’24 — from $13-billion across 820 deals to just $7,3-billion across 645 deals.
While the UK accounted for nearly half of all fintech investment in the EMEA region during 2024 ($9,9-billion), the total was a significant decline compared to 2023 ($13,6-billion).
The Middle East saw the most positive results in EMEA during 2024, with fintech investment rising from $1,2-billion to $2,2-billion year-over year.
African outlook
“Fintech investment on the African continent continues to be driven by the extraordinary demands for innovative and cost-effective solutions related to cross-border payments, digital banking services, and serving the unbanked millions,” says Auguste Claude-Nguetsop, partner and financial service sector head at KPMG in Southern Africa.
“We are also observing increased interest for solutions focused on capital markets such as trading and investment platforms, database tools and analytics, enabling African banks to reduce their costs, improve customer interactions and reach, and ultimately enhance productivity.
“Despite a relatively subdued year in 2024, with a decrease of fintech investments across the EMEA region, there were, however, a few noticeable exceptions, such as the investments of $110-million in Nigerian-based Moniepoint led by Google, and $250-million in South African-based TymeBank, enabling both firms to reach Unicorn status respectively in October and December 2024.
“The recent inclusion of M-Kopa into the Times Magazine list of most influential companies in 2024, alongside massive US and Chinese multinationals such as Nvidia and Baidu, is another sign of the strength and influence of African fintech companies expanding the frontier of financial inclusion, and attracting global interest, despite a modestly half-billion USD annual revenue,” he adds.
Asia-Pacific investment at lowest level
Total fintech investment in the ASPAC region fell from $14,6-billion in 2023 to $11,4-billion in 2024 — the lowest level of fintech funding seen in the region since 2014.
India accounted for the largest share of this total ($4,1-billion), led by a $1,5-billion raise by WSB Real estate partners in H1’24.
Total fintech investment in China dropped from $2,6-billion to just $687-million between 2023 and 2024, while Australia saw fintech investment nearly double from $840-million to $2,1-billion; fintech investment in Japan held nearly steady year-over-year at $660-million.
A sense of optimism for 2025
With interest rates declining in many jurisdictions and election uncertainties finally easing, there’s a cautious sense of optimism within the fintech market heading into 2025.
The average time between deals has also lengthened significantly, from approximately 15 months in 2022 to 24 months in 2025 — the longest it has been in the last decade — which could make 2025 a critical year for deal-making as fintechs look to ensure their continued operations.
While the payments space will likely remain the biggest ticket of investment globally, digital assets and currencies are well positioned for an upswing in investment—particularly when it comes to market infrastructure, digital tokenisation and stablecoins. AI is also expected to remain a key priority for investors, with regtech and cybersecurity-related solutions likely to see the most interest in H1’25.
“If what we’ve seen in the broader investment space is any indication, AI could be a sleeping giant for fintech investment,” says Anton Ruddenklau, lead of global innovation and fintech, financial services at KPMG International.
“However, right now, it’s still very early days. There’s definitely a lot of interest in AI, generative AI, agentic AI and automation, but there’s a lot of caution too. Over the next year, AI-focused regtechs will likely see the most traction among investors as financial services companies look for better ways to respond to the increasingly complex regulatory environment.”