Global slowdown hits fintech funding

New Delhi: India’s fintech sector saw funding plunge 63 per cent in 2023, at just $2 billion, from $5.4 billion raised in 2022, a report showed on Thursday. InCred was the only unicorn created in 2023, while the fintech sector saw 31 acquisitions and two IPOs.

Only five above $100 million funding rounds took place last year.India ranked third globally in 2023 in terms of fintech startup funding, strengthening its position as a significant player on the global stage, according to the report by Tracxn, a leading market intelligence platform.

Alternative lending, payments and banking-tech were the top-performing segments in the Indian fintech sector.Alternative lending received a funding of $835 million in 2023, down from $2.28 billion in 2022.The BNPL segment saw significant growth due to its adoption within the country, which contributed to the growth of the sector, said the report.

“Despite a 63 per cent decline, our sector stands strong as the third-highest funded ecosystem globally, affirming its position as a hub of innovation. The implementation of regulatory measures and the government’s commitment to digitalisation have set the stage for a promising future,” said Neha Singh, co-founder at Tracxn.

Late-stage rounds in 2023 secured $1.4 billion in funding, reflecting a 56 per cent drop compared to the $3.2 billion raised in 2022.