India now among top 3 fintech fund raisers but investments dip in H1 2024

India is now one of the world’s top three fintech nations when it comes to garnering funds, along with the US and the UK, says Tracxn FinTech Report

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Bengaluru leads India’s fintech funding in H1 2024, while Mumbai is at position number two and Pune takes the third spot

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India is now one of the top three fintech nations of the world when it comes to garnering funds, along with the United States and the United Kingdom, according to the Tracxn FinTech Report.

However, despite the feat, the country’s fintech ecosystem witnessed a dip in investments during H1 2024, the report said. The sector managed to garner funds worth $795 million from January to June this year, which marks a 59 per cent slump from $1.93 billion raised in H1 2023 and a drop of 11 per cent from $896.7 million raised in H2 2023, the report said, adding that the ongoing year has so far seen just two rounds of funding that were worth more than $100 million.

Industry watchers feel geopolitical unrest and global financial uncertainties slowed down the pace of fintech investment in India, despite the nation’s economy recording an impressive GDP growth rate of 8.2 per cent in FY24.

Bengaluru leads fintech funding in H1 2024, while Mumbai is at position number two and Pune takes the third spot, the report said. Peak XV Partners, Y Combinator, and LetsVenture are the biggest investors in Indian fintech.

Seed stage funding for fintech firms in H1 2024 stood at $65 million, marking a 43 per cent decline from $114 million in H1 2023. The H1 2024 investment figure, however, registered a 7.4 per cent increase from $60.5 million garnered in H2 2023.

Late stage funding in H1 2024 was $551 million, marking a 63 per cent drop from $1.5 billion in H1 2023. The H1 2024 investment figure, however, registered a 26 per cent increase from $436 million garnered in H2 2023.

Early stage funding stood at $179 million, marking a nearly 50 per cent slump from $361 million in H1 2023. The H1 2024 investment figure dropped 55 per cent compared to $401 million in H2 2023.

Going by quarterly data, the total funding that India’s fintech sector received in the first quarter of 2024, or Q1 2024, was $582 million. This marked a 55.6 per cent fall from $1.31 billion in Q1 2023, the Tracxn FinTech Report said. The sector drew $214 million investment during Q2 2024, which marks a 65 per cent drop compared to Q2 2023.

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