now loading...
Wealth Asia Connect Middle East Treasury & Capital Markets Europe ESG Forum TechTalk
Asset Management / TechTalk / Wealth Management
APAC fintech funding continues to grow
Q3 2021 transaction value and volume the strongest since 2019
Darryl Yu 19 Nov 2021

Fintech fundraising deals in Asia continue to grow from strength to strength with companies raising a total of US$5.47 billion in the third quarter of 2021, a 68% increase from the amount raised in the previous three months, according to data from S&P Global Market Intelligence (S&P). Transaction volume rose by 21% to 216 deals during the period.

Payment-focused fintechs continued to draw a significant share of the fintech funding in Asia, accounting for seven of 10 largest transactions in the region in Q3 2021.  

Fintechs in India were the main drivers of activity in the quarter, raising US$1.93 billion across 66 deals. In contrast to the ongoing regulatory crackdown on the sector in China, technology and new economy firms in India have attracted positive interest from both institutional and retail investors.

For example, Zomato, a consumer-focused technology company in India, this summer raised US$1.25 billion in its initial public offering and saw its shares rise 66% from the IPO price on the first day of trading. Other high-profile Indian tech companies such as Paytm and Policybazaar have gone public recently looking to ride on the wave of interest around new economy and fintech companies. Paytm however, had a rough debut to the market with shares of the payments company falling 25% on it's first day of trading.

“We are seeing a lot of strategic investments in India – not only from global corporates looking to get into the market, but also from some of the larger Indian conglomerates,” states Amarjeet Singh, partner at KPMG. “Over the last few quarters, we’ve seen big companies like Reliance and Tata focusing on investing in and acquiring other companies and startups in different areas. They are slowly trying to move into the area of something called the super app: an app that fits all the purposes that a consumer might need.”

Right behind India in terms of fintech funding was Southeast Asia, which saw fintech investments almost double quarter-on-quarter to US$1.90 billion in Q3 2021, based on S&P data. In fact, fintech fundraising activity in Southeast Asia year-to-date November 2021 reached a record high of US$3.5 billion, more than triple the amount for the whole of 2020, according to a report conducted by UOB, PwC Singapore and the Singapore FinTech Association.

In Vietnam, VNLife, which owns digital payments firm VNPay, raised over US$250 million in a series B funding round in August. The deal highlights an impressive year for Southeast Asian fintechs with the likes of Mynt, Ascend Money and Xednit also executing successful fundraisings in 2021.

“The surplus of capital flowing into fintechs has pushed up valuations, but public market investors have largely appeared unfazed by the lofty price tag,” S&P says in a commentary. “Perhaps seeing the potential of a lucrative exit, some venture capitalists have recently raised fresh funding targeted at tech startups in the region. This leads us to believe that fintech funding in Asia-Pacific still has legs despite a record quarter.”

Conversation
Han Ming Ho
Han Ming Ho
partner & co-head of investment funds, Asia Pacific
Sidley Austin
- JOINED THE EVENT -
In-person roundtable
Asia and the future of funds
View Highlights
Conversation
Grace Chong
Grace Chong
lead, regulatory & digital business
Simmons & Simmons JWS
- JOINED THE EVENT -
Webinar
The future of digital assets
View Highlights