Fintech’s success continues to attract investors, as KPMG’s latest “Pulse of Fintech” report shows: global investments in the sector (mergers and acquisitions, private equity, venture capital) during 2022 are certainly in decline, but 2021 was an exceptional year to catch up with 2020 and its lockdowns. The $164.1 billion (for 6,006 transactions) in 2022 are down from the $238.9 billion in 2021, but they are still higher than the $124.9 billion in 2020. The fall in the second half of 2022 may have caused some concern, but this opened up opportunities for buyers
The main fintech segments are payment, Insurtech (insurance), Regtech (regulation and compliance), Wealthtech (wealth management), cybersecurity and cryptocurrencies. The latter was impacted by the bankruptcies of FTX, Terra-Luna, and Celsius. Regtech is the only growing segment compared to 2021 (from $11.8 billion to $18.6 billion). This is explained by the ever-increasing regulatory requirements of regulators around the world. The payments sector remains in pole position with $53.1 billion invested (compared to $57.1 billion in 2021), or approximately a third of fintech investments. However this leadership is also explained by a large operation: the acquisition by the American Block (formerly Square) of the Australian Afterpay, specialist in “Buy Now, Pay Later”, for $27.9 billion.
The top 10 European fundraisers include Italy (Sia), Sweden (Tink, Klarna), Germany (Trade Republic), the United Kingdom (Interactive Investor, FNZ) and the French Spartfin via its LBO . According to FranceFinTech and the BPI, French fintech is the second European ecosystem behind the United Kingdom: it represents 40,000 jobs created, 900 companies and 10 unicorns (companies valued at more than $1 billion).
The return of inflation and the rise in interest rates are profoundly changing the monetary environment; neo-banks must reinvent themselves. In the United States only, Apple launched a savings account remunerated at 4.15%. Will the long-heralded GAFAs disrupt the industry? We talk a lot about artificial intelligence and we predict that startups will rush into it. Fintech remains a captivating place of inventiveness and breakthroughs, and the Vivatech trade show (14-17 June in Paris) will be an opportunity to take stock.
