Fintech investment in Asia Pacific rises to $7.5 billion in H1’21
Total fintech investment and deals activity in the Asia-Pacific region saw a solid rebound in the first half of 2021. After falling to $4.7 billion across 357 deals in H2’20, H1’21 saw $7.5 billion in investment across 467 deals. While both deal volume and value remained well shy of the record $25 billion across 504 deals seen in H1’18, the increased activity — particularly without any very large megadeals — is a positive sign for continued fintech investment in the region. Key H1’21 highlights from the Asia-Pacific region include:
Platform focus remains incredibly strong in Asia Pacific
Platform players with strong fintech offerings continue to be very hot in the Asia-Pacific region, with many working to build their breadth, reach, and market share. Indonesia-based Gojek raised $300 million in H1’21, while also announcing a merger with payments and eCommerce platform Tokopedia.
Jurisdictions taking very different approaches to crypto
Across the Asia-Pacific region, jurisdictions continued to take very different approaches to cryptocurrencies and crypto exchanges. In H1’21, China banned banks from providing cryptocurrency-related services,1 whereas Hong Kong’s Financial Services and the Treasury Bureau recommended all virtual asset exchanges in Hong Kong (SAR, China) be licensed and limited with professional investors.
Interest in SPACs increasing
Given the explosion of US-based SPACs in recent quarters, startups — including mature fintechs — in the Asia-Pacific region are expected to gain more interest from US-based SPACs looking to make deals. During H1’21, Singapore-based super app company Grab announced the largest SPAC merger ever: a $40 million deal with US-based Altimeter Growth Corp, which is expected to be finalized in H2’21.2
‘Buy now, pay later’ offerings growing quickly
The payments space was incredibly robust across the Asia-Pacific region in H1’21, with the ‘buy now, pay later’ space considered to be one of the fastest growing subsectors.
Unbanked and underbanked seen as tremendous opportunity
Investors continue to see significant opportunities across the Asia-Pacific region to better reach unbanked and underbanked. In India, for example, a number of fintech unicorns are working to become the core player between an individual and banking, insurance, or wealth management offerings.
Trends to watch for in H2’21
- a major increase in investment in H2’21, driven by the anticipated closure of Grab’s SPAC merger and Gojek’s merger with Tokopedia
- US SPACs looking for targets in the Asia-Pacific region
- increasing investment in insurtech, wealthtech, and B2B services
- big techs and platform providers continuing to expand into or across financial services.
This article is featured in Pulse of Fintech H1’21.
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In this edition of Pulse of Fintech, 72 deals were transacted in Singapore from January to June in H1 2021, which is about 20 percent more compared to a year ago. The number of deals transacted by Singapore's fintech industry in the first half of the year has hit a three-year high, valued at more than $614 million. This is due to corporates speeding up their digital transformation. Watch this Channel News Asia (CNA) interview featuring Anton Ruddenklau, KPMG’s Global Fintech Co-Leader, to hear his insights.
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VC investments surge and cross-border M&A more than doubles all of 2020.
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- global and regional analysis with key investment data and insights
- top fintech trends for 2021 and beyond
- interview with Jason Pau, Chief of Staff, International to the Chairman and CEO, Ant Group
- fintech segment insights for a deeper dive into payments, insurtech, regtech, wealthtech, cybersecurity, blockchain and cryptocurrency
- spotlight article, Putting big data at the heart of decision-making.
To learn more about the analysis and topics raised in this edition, or to discuss your organization's unique fintech agenda and roadmap, please contact your local KPMG advisors or the contributors in this publication.
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