Singapore leads fintech funding in Asia-Pacific: KPMG report
A new report from global consulting giant KPMG has identified Singapore as the world’s leading destination for fintech financing. In its KPMG Pulse of Fintech H2 ’22, the city-state named the Asia-Pacific region’s biggest winner in a year characterized by unfavorable macroeconomic conditions.
Singapore’s fintech funding for 2022 totaled an impressive $4.1 billion across 250 deals. The deals cut across mergers and acquisitions, private equity and venture capital funding, with payments technologies, wealth technology and blockchain technology the biggest beneficiaries.
KPMG notes that the $4.1 billion achieved in 2022 was a 75% increase from the $2.3 billion recorded in 2020. However, fintech funding in Singapore peaked over the past decade in 2019 at 5 .62 billion before the COVID-19 pandemic.
The rest of the Asia-Pacific region recorded stellar numbers as they cumulatively reached 50 billion in fintech investments. The EMEA (Europe, Middle East and Africa) region followed closely with $44.9 billion across 1,977 deals during the year, driven by rettch and payments.
“While both the Americas and Europe saw declines in fintech investment, the Asia-Pacific region slightly outpaced the 2021 peak on the back of the Afterpay acquisition,” the report read.
Anton Ruddenklau, KPMG’s global head of financial innovation and fintech, explained that investment in Europe and America was stifled by “high inflation and rising interest rates, the lack of IPOs, the downward pressure on valuations, and of course turbulence in the crypto space.”
The numbers achieved by Singapore were not a fluke, as the country has taken several deliberate steps to attract international investment into its digital ecosystem, including establishing a clear legal framework.
A silver lining to the dark cloud
2021 was an impressive year for fintech funding, with KPMG recording an impressive $238 billion in over 7,000 deals. On the other hand, 2022 could only manage to reach 164 billion, a decline of around 30% from the peaks of 2021.
Despite the differences in the figures, KPMG believes that there are still small gains in 2022, such as the number of deal volumes and seed deals achieved. The consulting firm noted that the volume of regtech investment “soared to a new high.” At the same time, regional diversification was also impressive as less mature hubs also received their fair share of funding.
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