Fintech investments in Singapore hit S$1bn in first nine months of 2019

SINGAPORE — Financial technology (fintech) companies in Singapore raised a record US$735 million (S$1 billion) in the first nine months of this year, even though fewer investment deals were made, a report by global consultancy Accenture said on Tuesday (Oct 15). 

The total value of fintech deals from January to September was a 69 per cent increase from US$435 million in the same period last year, the report noted. 

The total amount raised for the first three quarters also exceeded the US$642 million raised in all of 2018. 

The value of investments pumped into fintech firms here shot up even though the number of deals fell by 29 per cent over the same period, from 133 to 94, Accenture noted, saying that this indicates investors are making “larger bets into fewer deals as startups (grow) their business”. 

Investments into start-ups that were just getting started fell, both in value (-56 per cent) and in quantity (-46 per cent). 

In contrast, investments into more mature startups grew by 66 per cent to US$442 million, while the number of deals was roughly the same. 

Most of the funding went into payment startups, accounting for 34 per cent of total investments. The number of deals for payment startups also went up by 60 per cent. 

Investors are seeing potential opportunities in the payments space, said the report, as “fintechs and traditional financial firms look for ways to collaborate as Singapore prepares to issue digital banking licences in the coming months”. 

The funding of insurance tech startups saw the biggest jump, at almost four times from US$35 million to US$128 million. That accounted for 17 per cent of total funds raised. 

Monetary Authority of Singapore chief fintech officer Sopnendu Mohanty said the record-breaking investment is a sign that investors recognise the potential of Singapore’s fintech ecosystem and the outlook for digital financial services not just in Singapore, but also in South-east Asia. 

“It’s encouraging to see the local startups financing their global growth from Singapore. Additionally, several global fintech companies with regional headquarters in Singapore have recently raised sizeable funds to fuel their Asian expansion,” he added.