The first six months of 2023 were quite challenging for the global fintech market. Some of the challenges were expected — high levels of inflation, rising interest rates, the ongoing conflict between Russia and Ukraine, depressed valuations, and a lack of exits; others were less so, including the collapse of several banks in the US.

Looking back on the first half of 2023, fintech investor sentiment can be characterized as highly selective. Heading into the second half of 2023, market challenges are expected to continue — which could make for another bumpy six months. AI is expected to be a hot topic of conversation — and likely funding — even if fintech activity remains subdued. As the market begins to stabilize, however, funding in fintech will likely perk up. Payments, in particular, is well positioned to see funding continue and accelerate, in addition to insurtech and wealthtech. Should market conditions improve, M&A activity could also start to climb again as PE investors and corporates look for good deals.

Whether you’re the CEO of a large financial institution or the founder of an emerging fintech, it’s critical to consider how your company can grow sustainably and profitably even in these uncertain times. As you read this edition of Pulse of Fintech, ask yourself: How can we position our organization to weather today’s storms while positioning for long-term success?