2022 was a challenging year for fintech investment globally — with the Americas seeing a US$40 billion drop in investment compared to 2021’s high. The decline in deal value doesn’t tell the full story, however.

Deal volume was incredibly robust this year: the second highest total next to 2021. Seed deals saw record investment, which bodes well for the long-term fintech pipeline. At a sector level, regtech investment soared to a new high, while, geographically, the Asia-Pacific region also hit a new peak — if by a much narrower margin.

The diversity of jurisdictions attracting significant fintech deals was also very strong. In H2’22 alone, 24 different countries attracted over US$100 million fintech deals (venture capital, private equity, mergers and acquisitions) — ranging from traditional hubs like the US, UK, Singapore and Hong Kong (SAR) to less mature fintech hubs like South Korea, Luxemburg, Italy, Malaysia and the UAE. This diversity reflects the myriad value propositions offered by fintech, from enabling innovation at financial institutions to supporting small business growth and improving financial inclusion and access to financial products.

Looking across 2022, there’s no doubt that the fintech market globally saw both highs and lows.

Some key trends we’ve seen include:

  • surging investment in regtech as companies look to technology to help them manage increasingly complex regulatory compliance obligations; 
  • rapidly cooling investment in cryptocurrencies and crypto exchanges between H1’22 and H2’22, with more challenges expected on the horizon;
  • strengthening partnerships between fintechs and incumbent financial institutions, including banks, insurance companies and wealth management firms; and
  • decreasing number of large deals in H2’22 compared to 2021 and H1’22 as investors waited for valuations to stabilise.

The fintech landscape in Singapore

Singapore achieved its highest fintech funding in three years, hitting US$4.1 billion across 250 deals in mergers & acquisitions (M&A), private equity (PE) and venture capital (VC) in 2022. The top three investment areas in Singapore were crypto/blockchain, payments and wealthtech.


Investors shift to non-crypto blockchain-based solutions

In Singapore, cryptocurrency and blockchain funding in Singapore declined 21% from US$1.5 billion in 2021 to US$1.2 billion in 2022. One trend expected to grow in 2023 is the shift of investors from blockchain companies focused on the retail market to startups focused on providing solutions for the SME market. 


Payments remains a hot space in the fintech market 

In Singapore, funding for payments rose 57% in 2022, driven by increasing interest in embedded payments across various sectors and popular alternate financing source Buy Now Pay Later .


Cost of compliance remains key driver of regtech interest

The ever-increasing cost of compliance is a major challenge for financial services companies, with multinational companies particularly challenged by multiple jurisdictions. Singapore may have some way to go to attract fintech investments in this space. Locally, there was a 5% decline in regtech deal value to US$63.3 million in 2022.


Expanding access to a broader base of investors

Singapore experienced a wealthtech sector rally attracting US$500 million in fintech investments in 2022, up from US$29.6 million in 2021. H2'22 saw the two largest wealthtech deals of the year. This comes as a growing number of wealthtechs focus on developing solutions for a broader base of investors to access asset classes. These platforms have typically only been used by institutional or high-net-worth investors.


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