Leading fintech-as-a-service provider, Soft Space Sdn Bhd (“Soft Space”), JCB International Co., Ltd.(“JCBI”), the international operation­­s subsidiary of JCB Co., Ltd., Japan’s leading international payment brand, and Hong Leong Bank (“HLB”) have joined forces to actively drive JCB Card acceptance in Malaysia, bolstered by strong post-pandemic economy recovery prospects. 

As the Malaysian economy continues to grow positively in 2023, tourism has emerged as one of the brightest sectors spearheading the recovery process, with Japan listed as one of the top 10 contributors to tourist arrivals and spending in Malaysia. Malaysia targets to welcome 16.1 million international tourist arrivals and generate RM49.2 billion (US$10.89 billion) in tourist receipts in 2023.

To capitalise on this bright recovery prospect, Soft Space and JCBI recently signed an agreement to enable Soft Space to work with local acquirers, such as HLB, to promote JCB Card acceptance in Malaysia. Sofitel Kuala Lumpur Damansara, a hotel in Kuala Lumpur, is one of HLB’s merchants that has begun accepting JCB Card payments.  

“As Japanese tourist arrivals in Malaysia begin to ramp up again, we are pleased to be able to enable and promote cross-border payments between Japan and Malaysia via our partners,” said Joel Tay, Chief Executive Officer of Soft Space. “This merely represents a first step in our ambition to roll out similar agreements in Southeast Asia, boosting JCB Card acceptance and riding on the wave of increasing contactless card payments in the region.” 

“We decided to expand the collaboration with another global leader who shares similar values in enhancing user experience through state-of-the-art technological application,” said Yoshiki Kaneko, President and Chief Executive Officer of JCB International Co., Ltd. 

“Malaysia has been an important destination country for our card members across the regions. Establishing a partnership with HLB is a huge step forward for the expansion of JCB acceptance network in Malaysia. We can now better serve JCB Card members coming to Malaysia not only from Japan, but also from the ASEAN region where we have more than 10 million card members. I am especially delighted as this achievement has been brought via a unique tripartite collaboration including Soft Space. Leveraging on today’s success, we are further strengthening our presence in the entire ASEAN region through this partnership with Soft Space.” 

According to Andrew Jong, Managing Director of Personal Financial Services at HLB, this partnership with JCB and Soft Space signifies the Bank’s commitment to providing financial products and services that are centred around the needs of both its merchants and their customers.   

“With an influx of tourists and expats coming from Japan into Malaysia, the option to accept JCB Cards will ensure convenience for its cardholders and provide businesses with an additional opportunity to capture more tourists and grow their business. This partnership will enable us to serve the customers who are increasingly going cashless as well as help our merchants increase their sales and customer transaction value.”  

The agreement showcases the partnership progress between JCB and Soft Space since the former investment in the fintech in January 2022. This includes a series of business collaborations that are aimed at leveraging on Soft Space’s fintech-as-a-service business model, technology and regulatory knowhow, and JCB’s global recognition, vast alliances and brand reach. 

The promotion of JCB Card acceptance in Malaysia also signals the expansion of its merchant network, the establishment of card issuing solutions, and the provision of customer marketing solutions in Malaysia, and later in Southeast Asia. 

Kiwi, the revolutionary credit on UPI platform partners with Axis Bank, one of the largest private sector banks in India to bolster 'Credit on UPI' accessibility on Rupay credit cards.. 

The partnership enables Kiwi users to seamlessly access the RuPay lifetime free virtual Axis Bank KWIK credit card through the app. With its innovative features, users can make merchant payments within the Kiwi app using their credit cards via UPI, offering a virtual payment experience eliminating the need for physical cards. The end-to-end digital payment solution aims at enhancing the payment experience for customers. With this partnership, customers can enjoy the benefits of credit card rewards, while experiencing the convenience of UPI's fast and secure payment.

Key product features* 

•          UPI enabled free virtual Credit Card
•          2 edge rewards per Rs.200 spent.
•          1% cash back on Scan & Pay Transactions (using CC on UPI), powered by “Kiwi”
•          1% Fuel surcharge waiver*

Siddharth Mehta, co-founder, Kiwi, said, "We are excited to announce our first banking partnership with Axis Bank, India's third-largest private sector bank, in collaboration with NPCI. This marks an exciting milestone for Kiwi as we embark on a journey to revolutionize the 'Credit on UPI' ecosystem. Kiwi's unique focus on 'credit cards with UPI' sets us apart in the fintech industry. Together with Axis Bank, we will provide seamless on-boarding and instant virtual credit cards powered by a robust tech stack, offering our customers a comprehensive end-to-end experience of 'Credit on UPI.' Our goal at Kiwi is to enable 1 million users to access credit cards on UPI over the next 18 months, and we plan to achieve this by forging additional banking partnerships in the upcoming months.”

Sanjeev Moghe, President & Head, Cards & Payments, Axis Bank, said, “Axis Bank is a full suite cards & payments player and we continue to build on innovation led partnership models. We are committed to drive access to formal credit in India with offerings that benefit our customers. We are excited to partner with Kiwi to launch the Axis KWIK virtual credit card that offers credit card rewards along with the convenience of UPI's fast and secure payment.”

“The digital payments space has grown significantly in recent years. The RBI's credit card-UPI linkage announcement is expected to boost credit card usage for small-value payments on the UPI platform. This will encourage more customers to choose credit cards, benefiting from the convenience of UPI that was previously limited only to bank accounts. Axis Bank has been at the forefront of extending UPI’s multiple payment flows to its customers, and we continue to scale up such innovations that democratize access to formal credit in India.” Sanjeev, further added.

Praveena Rai, Chief Operating Officer, NPCI, said, “We are excited for the partnership between Axis Bank and Kiwi, as they combine forces to offer a complete "Credit on UPI" platform on the expansive RuPay network. This collaboration will propel credit and payment accessibility to a wider user base providing them with secure and innovative payment option for seamless online and offline transactions. We look forward to the widespread usage, growth and penetration of this unique payment solution which combines the convenience of UPI with rewards and benefits of RuPay Credit Cards.”

As a fintech company focused on “credit cards with UPI”, Kiwi is a comprehensive payments platform offering users complete end-to-end lifecycle management of credit products on the app, right from on-boarding (for issuing a virtual credit card) to enabling payments using the issued ‘CC on UPI’ to rewards on repayment (Kiwis tokens). The Kiwi app offers card management facilities - blocking, setting limits, etc., allowing users to link their existing debit accounts to the app.

Kiwi has been co-founded by senior fintech experts and banking industry veterans, Siddharth Mehta (ex-CEO, Freecharge), Mohit Bedi (ex-Axis Bank & PayU), and Anup Agrawal (ex-business head, LazyPay). Earlier in May, the company raised $6 million in pre-seed funding from marquee investors: Nexus Venture Partners, Stellaris Venture Partners, and a host of angel investors.

A new report by YouLend, a leading global embedded finance platform, conducted in partnership with Experian, the world’s leading global information services company, found that YouLend attracted 12% more applications from female-led businesses and was more than twice as likely to finance female-led businesses than the UK average. 

The Widening Access to Capital Report indicates that embedded financing models are more effective than traditional banks in providing capital to female-led SMEs. Analysing over 100,000 cases of merchant financing from YouLend and comparing it to Experian’s data about the market, the study also uncovered that last year YouLend offered 90% approval rates for applicants, well above the 64% average in the UK. 

Commenting on the findings, Mikkel Sølvsten Velin, YouLend Co-Founder and Co-CEO, said, "Our report confirmed that female-led businesses face more barriers when accessing much-needed finance than male-led businesses do. Positively, we also found that embedded finance can help break down those barriers through new distribution channels and potentially less biased underwriting models.”

He concludes: “Whilst we are proud of our social impact at YouLend, there is much more to be done to ensure equitable access to finance for businesses in our end markets in the UK, EU and the US, particularly during the cost of living crisis.”

YouLend and Experian’s study reveals that embedded financing models are generally more effective in providing capital for underserved communities in the UK. Embedded finance models place financial products in a nonfinancial customer experience, journey, or platform without redirecting to traditional financial institutions. This allows excluded groups to apply for flexible, agnostic, and affordable financing. 

For example: 

• Over half (58%) of YouLend’s SME capital segment went toward the two most deprived regions in the UK

• 29% of all applications YouLend receives are from female-led businesses, outperforming the national average of 17% on application and approvals 

Access to vital financial support for SMEs is essential to power growth on a local level. The data shows that by the end of H1 2023, SMEs contributed an additional £6.8 billion in revenue to the UK GDP and increased employee headcount by 14% by receiving financing from YouLend. 

Read the full report here. 

Every year there are nearly 3 billion airline payment transactions take place around the globe with a total value of $1 trillion. According to a recent report from McKinsey, although these payments represent huge value to the travel industry, they cost the airline industry over $20 billion a year. This amounts to about 3% of airlines total revenue but more importantly 78% of the industry’s net profit.  

And this is just the airlines, the travel industry as a whole spends billions on payments and according to a recent whitepaper from IATA, 41% of travel firms say the biggest source of financial stress is the complexity of managing payment systems. 

Having worked in both the payment and travel industry for many years I have seen first-hand the problems and risks that the industry face due to limited and outdated payment solutions. It was the magnitude of this problem that led to the concept of FinMont which along with the cofounders of German airline, Hahn Air, we have just launched. Our new global payment orchestration platform is built specifically for Travel Merchants and uses cloud-native technologies to integrate acquiring banks, payment, fraud, forex, and chargeback providers and offer a fully automated and seamless payment solution.  

Seamless customer experiences are now something that consumers expected across all industries and the travel industry needs to improve payment integration, especially at the point of check-out to ensure the solution is at the standard expected and offered across other sectors. Airline retailing, essentially selling new products in new ways both directly to customer's or via intermediaries could be worth $40 billion by 2030. 

Retail payments are only part of the problem for travel merchants as B2B payments also need updating to allow a more streamlined solution for corporates, airlines, travel agents, hotel chains, car rental companies and many other travel-related businesses.  Our platform is offering the travel industry a significantly different solution compared to other options available as it will streamline not only B2C payments but also B2B payments. Combining both payments into a single view will help decision-makers identify and fix any inefficiencies in their current payment processes.  

With B2B payments, merchants historically have struggled to process supplier payments as they all require unique information such as time of payments, payment methods used or invoicing process. Whether travel merchants are pre-paying suppliers, paying them in multiple currencies, paying them on check-out or on receipt of an invoice, this is where we will offer a ground-breaking solution that will automate the whole process. 

Historically the travel sector has had huge issues with reducing shopping cart abandonment and increasing sales conversion. It is fair to say that for many airlines and other travel merchants, there are opportunities to improve the retail customer payment experience that will reduce dropouts. Many airlines and agents also lose customers in the buying process due to only being able to offer limited payment methods and alarming some have even relied on only one payment provider, which is a high-risk strategy and can have huge consequences, especially if there is any downtime. Having such a limited solution can also mean having to pay much higher fees for payments. 

Having worked in the travel and payment industry for many years with a software engineering background I have seen first-hand how complex and often archaic payment solutions impact airlines and travel agents. With so many payment methods, banks and card suppliers around the globe managing payments have always been challenging for firms across the travel sector. 

To be able to launch our solution with the founders of Hahn Air, we believe FinMont offers a truly unique and cutting-edge solution for the global travel industry to tackle both B2C and B2B payments. 

Leading financial experts and industry professionals are set to gather in New York from November 13th to November 15th, 2023, for the highly anticipated GFMI ESG and Sustainable Investments for Financial Institutions conference. Hosted by marcus evans Conferences, the event will provide a comprehensive overview of the global regulatory environment within Environmental, Social, and Governance (ESG) investing and its influence on North America.

The conference will kick off on November 13th at 8:30 AM with registration and breakfast, followed by an opening address from the Chair. The agenda for Day 1 will cover critical topics such as understanding and complying with global ESG regulation, preparing for impending ESG legislation in North America, and effectively operating within fiduciary duty amidst a polarized view of ESG.

Renowned industry experts will deliver keynote presentations, including Laura Fernandez, Managing Director of Regulatory Affairs and ESG at Kinterra Capital, and Elizabeth Levy, Head of ESG and Portfolio Manager at Trillium Asset Management, among others.

The conference will also feature panel discussions with prominent figures from the financial sector, including Sarah Bratton Hughes, Head of Sustainable Investing at American Century Investments, Anshul Sharma, Managing Director of ESG Portfolio Strategy and Chief Investment Officer at Bank of America, and Rachel Segal, Head of ESG at Pzena Investment Management, among others.

Day 2 of the conference, on November 14th, will focus on understanding global standardized frameworks for ESG investing and assessing the benefits of a standardized approach. Experts from various financial institutions will discuss the challenges and opportunities associated with impact investing and share insights into strategies for decarbonizing portfolios.

In addition, the event will include workshops and roundtable discussions to encourage interaction and knowledge sharing among participants. Vicki Benjamin, CEO and Co-Founder of Karner Blue Capital, will lead a workshop on the financially material impact of biodiversity investing. Another workshop will explore the applications of Artificial Intelligence (AI) in collecting ESG data and measuring social impact.

"This conference comes at a critical time when the financial industry is increasingly recognizing the importance of ESG considerations in investment decisions. We are excited to bring together thought leaders and experts to exchange insights and strategies on sustainable investments," said the event organizer.

Financial institutions, asset managers, investment professionals, and other stakeholders interested in ESG and sustainable investments are encouraged to attend the conference and be part of the dialogue shaping the future of responsible finance.

For more information and registration details, please visit the conference website at https://bit.ly/47hFH7U. 

Sezzle, a leader in the digital payments industry, has been recognized on CNBC’s list of World’s Top Fintech Companies 2023. This prestigious award is presented by CNBC and Statista Inc., the world-leading statistics portal and industry ranking provider. The awards list was announced today, August 2^nd, 2023, and can currently be viewed here on the CNBC website.

For the first time, CNBC and Statista are awarding the World’s Top Fintech Companies in nine different market segments. The top list is based on the analysis and weighting of overarching and segment-specific KPIs derived from a collection of research methods. 

Based on the results of the study, Sezzle is pleased to be recognized on the CNBC list of the World’s Top Fintech Companies 2023. Amid the macroeconomic challenges and choppy waters that 2022 brought to the financial sector, Sezzle took charge and made an astounding turnaround - becoming among one the only profitable Buy Now, Pay Later players in the industry. This award cements the dedication of its employees and the Company’s commitment to its shoppers, constantly advancing the Company’s commitment to being the Responsible Way to Pay™.

“We spent the past year building and creating an entire suite of new product features intended to bring our shoppers closer to financial freedom,” said Sezzle CEO, Charlie Youakim. “CNBC's recognition of Sezzle as the only pure Buy Now, Pay Later platform in its inaugural report of the Top Fintech Companies for 2023 is a great achievement and supports our momentum to become the leading digital payment solution. We are committed to advocating for the credit marginalized, and building products that bridge the gap between traditional banking and those who need responsible credit most.”

As digital payment platform adoption continues to expand, Sezzle’s differentiation remains top of mind. Sezzle was the first to obtain B Corp status in payments, a designation that is still rare among BNPLs. At Sezzle’s core, it is a stakeholder-centric company that strives to make an even greater impact across its stakeholder groups – consumers, merchants, employees, communities, and investors. Sezzle integrates stakeholder concerns into all decisions made across the business to enhance sustainability, promote equity, and support communities. With this recognition, Sezzle aims to promote our sustainable, ethical business model to the entire industry. 

Regnology, a leading software provider with a focus on regulatory reporting solutions, announced today that its client Clearstream Banking AG, central securities depository and leading provider of global post-trade services, has signed on to use its Rcloud technology (powered by Google Cloud Platform (GCP)). While the migration is still subject to regulators’ approvals, Clearstream’s intent to move from on-premise regulatory reporting to the cloud highlights the reliability and security of the Rcloud platform. Regnology launched its Rcloud solution in partnership with Google Cloud in November 2022.

Clearstream, Deutsche Börse Group’s post-trade business for the global markets, offers one of the most comprehensive international securities services available, settling more than 250,000 transactions daily for customers in over 110 countries. Being an international financial infrastructure provider, Clearstream abides by strict compliance requirements of German and Luxembourg authorities.

“Clearstream’s decision to move to the Rcloud platform is a landmark moment because of the trust that Clearstream put in our technological partnership with Google Cloud,” said Antoine Moreau, Chief Technology Officer at Regnology.

“As one of our valued clients, Clearstream Banking AG has relied on our regulatory expertise and technology to support their reporting obligations for years. Due to its position and status as one of Europe’s most heavily regulated entities, Clearstream’s selection of Rcloud speaks volumes about their trust in our depth of knowledge and the added scalability and performance benefits of our cloud solution. We see cloud adoption acceleration amongst our customers and believe our regulatory expertise team with the GCP know-how can help build the foundation for an industry cloud approach to financial services regulatory reporting,” added Maciej Piechocki, Regnology’s Chief Revenue Officer.

“With our hybrid, multi-cloud strategy, Deutsche Börse Group sets new standards for cloud innovation across the financial services industry. We are very satisfied to be one of the first institutions to sign on to the Rcloud platform. In Regnology, we found an excellent partner for the next step on Clearstream’s cloud journey, supporting our clients with state-of-the-art regulatory reporting solutions,” said Clearstream Banking AG CTO Volker Riebesell.

The Rcloud platform delivers ultra-elastic scalability along with reliable and fast report submission and always up-to-date reporting data and software, offering all the benefits of a modern regulatory-as-a-service solution. Going beyond standard cloud frameworks, Rcloud offers improved deployment and infrastructure-as-code services, run and change management automation, and additional benefits including self-service via the Regnology Cloud portal, and future-proofed architecture for additional services and products. Regnology’s partnership with Google Cloud, which matches 100% of its electricity consumption with renewable energy purchases, also ensures that sustainability is built into the platform.

Provenir, a global leader in risk decisioning software, announced today that GoFi, LLC, a leading U.S. consumer automotive financing provider, has selected and implemented Provenir’s Data and Decisioning Platform to assess applicant credit risk quickly for real-time financing approvals.

GoFi, LLC is an AI-centric, digital-first lending platform. Built on a proprietary loan origination system and powered by its integrated machine learning algorithms, GoFi provides auto-decisioned responses across the full credit spectrum. Through simple, intuitive offers, GoFi aims to help partners expand their brand impact and deliver a better customer experience.

“We selected Provenir for several reasons, most importantly, for the platform’s flexibility and customization options. It also allows us to quickly and easily integrate with many different platforms which will allow our business users to take the reins,” said Daniel Garland, Senior Director, GoFi. “We have been able to implement a fully customizable solution that meets our business needs with the vast majority of the implementation being done by our business users.”

“We are pleased to partner with GoFi to power the real-time risk decisioning needed to provide the very best customer experience,” said Kathy Stares, Executive Vice President, North America for Provenir. “From global car manufacturers to independent auto lenders, Provenir empowers auto financing providers of all sizes to make accurate decisions faster while minimizing risk and preventing fraud. Provenir’s data and decisioning capabilities enable our auto financing clients to respond on-the-fly to changing market dynamics and deliver real-time insights to inform smarter decisions.”

Provenir’s industry-leading credit risk decisioning platform uniquely combines universal access to data, embedded analytics and sophisticated decisioning technology. This provides a cohesive risk ecosystem to enable smarter decisions across the entire customer lifecycle – with diverse data for deeper insights, auto-optimized decisions, and a continuous feedback loop for constant improvement.

Converge Insurance, pioneers in advanced cyber risk management and underwriting, announced $15 million in Series A funding from Forgepoint Capital. Forgepoint Managing Directors Don Dixon and Andrew McClure have joined the company’s Board of Directors as part of the financing.

In 2021, 61% of small to medium-sized businesses (SMBs) were the target of a cyberattack. Meanwhile, 60% of SMBs go out of business within 6 months after an attack occurs. Unfortunately, the vast majority of SMBs lack cyber insurance and adequate cyber protection due to cost, inaccessibility and limited IT resources. Converge is a modern managing general agent (MGA) that fuses cyber insurance, security, and technology to address this critical need. By deploying a proprietary data ecosystem underpinned by expert underwriting, Converge provides precise cyber risk solutions that deliver improved outcomes for its customers, starting with SMBs.

Tom Kang has been appointed as CEO of Converge Insurance as part of the financing round, which closed last week. “Our mission is to empower policyholders with radically transparent cyber insurance so they can manage technology risks more intelligently,” said Kang. “We’re thrilled to partner with the team at Forgepoint Capital, who uniquely understand the needs and opportunities of this burgeoning market. This funding will enable us to expand our outreach and grow our bench of in-house experts while accelerating the availability of the Converge platform worldwide.”

Last week, leading global insurer QBE North America announced the launch of a cyber insurance program with Converge acting as program administrator, the first of many partnerships as the company scales.

“Converge is the latest company in our investment strategy to reinvent cyber insurance and risk management,” said Dixon. “We couldn’t be prouder of the seasoned team assembled at Converge and the progress they have achieved in such a short amount of time with their unique cyber underwriting model.” Forgepoint has backed other leading brands in the cyber insurance market, including risk analytics leader CyberCube Analytics, incident response firm Surefire Cyber, and managed security service provider SolCyber. Converge is the third company incubated at Forgepoint to focus on the cyber insurance market.

Kang, a licensed attorney who was elevated to CEO from his prior role as Chief Insurance Officer at Converge, is an expert in the cyber insurance industry. He has held several senior leadership roles specializing in high exposure cyber product strategies and solutions, consulting, business intelligence and data for global organizations. Prior to Converge, Kang was Head of Cyber, Tech and Media at Allianz Global, Global Cyber Product Leader at Willis Towers Watson, Enterprise Lead for Cyber Liability at The Hartford, and Assistant Vice President, Director of Claims and Services at ACE Group.

“Converge combines a proprietary data ecosystem, expert underwriting from a world-class team and a powerful platform with a results-driven approach designed to mitigate risk,” said McClure. “What they have been building is truly world-class and will change the game for an industry in dire need of modernization. I am excited to work with Tom Kang to lead the company forward together with this team and for the platform to make its global debut.”

Joining Kang on the Converge team are several other seasoned leaders who bring extensive experience spanning cyber insurance, underwriting and software development to continue to accelerate the organization’s growth plans. The company has also added multi-time CEO and experienced company builder Tom Kelly to the Board of Directors. Global Holdings CEO Steve Petrevski is also on the company’s Board of Directors. Converge co-founder and former Forgepoint Entrepreneur-In-Residence Anthony Dagostino will remain an advisor to the company during the transition.

In the first six months of 2023, Singapore fintechs raised US$934 million across 84 deals in mergers & acquisitions (M&A), private equity (PE), and venture capital (VC), according to the KPMG Pulse of Fintech H1'23 - reflecting a 41 per cent fall from US$1.6 billion across 117 deals in H2'22. Global trends echo local analysis with total funding and the number of deals dropping, from US$63.2 billion across 2,885 deals in H2'22 to US$52.4 billion in across 2,153 deals in H1'23. In Singapore, the fintech funding has yet to fully correct from the pandemic funding surge that began in H2'19, reflecting H1'23 performance as a three-year low, but still well above the H1'19 funding slump of US$344 million across 70 deals (see Figure 1) in the link below.

Global and Singapore fintech funding reduced - KPMG Singapore

The cloud of uncertainty permeating the global market continued to wear on investors, driven by factors including global macroeconomic concerns (high inflation and rising interest rates), geopolitical tensions, and tech sector challenges (depressed valuations and a continued lack of exits). The collapse of several US banks early in 2023 likely also kept many investors in "wait and see" mode during H1'23.

According to the H1'23 edition of KPMG's Pulse of Fintech, a number of sectors attracted robust funding during the first half of 2023. Globally, supply chain and logistics-focused fintechs attracted US$8.2 billion in funding in H1'23—well above the space's 2019 annual record of US$5.5 billion. Green fintech also had robust interest, with US$1.7 billion of funding during H1'23— already slightly ahead of its 2022 results (US$1.5 billion).

At a regional level, the Americas saw fintech funding grow—from US$28.9 billion to US$36.1 billion between H2'22 and H1'23—despite a decline in deals volume—from 1,323 to 1,011 deals—over the same timeframe. In the EMEA region, fintech funding dropped by more than 50%, falling from US$27.3 billion across 963 deals in H2'22 to US$11.2 billion across 702 deals in H1'23. Fintech funding also dropped in the ASPAC region—from US$6.8 billion across 583 deals in H2'22 to US$5.1 billion across 432 deals in H1'23. Among the top 10 fintech deals in Asia Pacific in H1'23 were (i) US$270 million raised by Singapore-based credit services firm Kredivo Holdings and (ii) US$105 million raised by Trusting Social, a Singapore-based consumer finance.

Singapore attracts artificial intelligence funding of US$129 million

In Singapore, artificial intelligence (AI) and machine learning funding attracted six deals amounting to US$129 million in H1'23, signifying an early growth of application in generative AI particularly in the areas of cybersecurity, insurtech and wealthtech.

Similar to H1'22 and H1'21 trends, Singapore's top funded fintech sectors were payments (US$119.6 million across 8 deals) and crypto (US$234.7 million across 36 deals) in the first half of 2023. In the payment space, Singapore-based Thunes raised the largest round in the ASPAC region, amounting to US$60 million.

Within the crypto space globally, Singapore has gained prominence among investors and startups as a strong forerunner. This comes as the nation has in place regulations such as the Payment Services Act and Digital Token Payment Act and is in the process of issuing regulations related to stablecoin issuance.

"It is still very early days when it comes to the application of generative AI to use cases in financial services," said Anton Ruddenklau, Global Fintech Leader at KPMG. "But looking forward, it is an area that is attracting enormous interest and funding—particularly in areas like cybersecurity, regtech, and wealthtech. Over the next six months, we'll start to see an uptick in investors embracing the space as corporates demand ways to leverage generative AI effectively."

Payments, crypto and AI among well-funded fintech in Singapore

In Singapore, investors embraced payments, crypto as well as artificial intelligence and machine learning deals, making these verticals the top three most funded fintech space. (see Figure 2). While the interest rate environment remains high, investors have a keen eye on the potential of AI-linked application for payments and crypto as these AI projects can help solve problems and bring in solid returns. This indicates a strong vote of confidence in this space which has driven fintechs to continue to be nimble during the current economic environment, adjust burn rates and extend funding pathways.
 

Figure 2: Singapore's fintech deal values and volume for H1 2023 to H2 2022

Amid economic headwinds and increased market volatility, consolidation was a key factor driving funding activity in the payment space. During H1'23, a number of fintechs embraced acquisitions in order to scale and grow their reach. During 2021 and much of 2022, global investors in the payments space embraced a broad range of payments solutions and opportunities — with Buy Now Pay Later (BNPL) companies accounting for many of the largest deals. In H1'23, this focus shifted significantly, with many investors shifting their attention back to fintechs with core payments processing capabilities and robust business models.

The crypto and blockchain space saw global investors pulling back in the wake of growing economic uncertainty, including ongoing concerns about a potential recession, high interest rates, and the significant pressure on valuations. The collapse of several crypto-focused companies during 2022 also significantly affected investor confidence; the subsequent increasing focus on due diligence and governance likely slowed the speed of crypto deals even further. As interest in crypto remained soft, interest in other solutions leveraging blockchain-based technologies continued to attract interest from investors. In particular, investors have shown continued interest in blockchain-based solutions related to the tracking and tracing of carbon credits, and the traceability of food from farm-to-table.

"It wasn't a surprise to see fintech funding decline in the first six months of 2023, given the enormous headwinds pressuring the market at the moment," said Judd Caplain, Global Head of Financial Services at KPMG. "But the long-term business case for many subsectors within fintech remains very strong—particularly for sectors like payments, insurtech, and wealthtech. Once market conditions begin to even out, funding will likely rebound--if not to the record level experienced in 2021."

Global Key Highlights
 

• Global funding in fintech dropped from US$63.2 billion across 2,885 deals in H2'22 to US$52.4 billion across 2,153 deals in H1'23.
• The Americas attracted US$36.1 billion in fintech funding across 1,011 deals in H1'23—of which the US accounted for US$34.9 billion across 809 deals. The EMEA region attracted US$11.2 billion across 702 deals, while the ASPAC region attracted US$5.1 billion across 432 deals.
• Global VC funding declined from US$28.3 billion in H2'22 to US$27.3 billion in H1'23. The Americas attracted US$16 billion in funding during H1'23—of which the US accounted for US$15.1 billion, while EMEA attracted US$6.6 billion in VC funding, and the ASPAC region saw US$4.6 billion.
• Global M&A activity was quite soft in H1'23, with only US$24 billion in deal value, including US$19.3 billion in the Americas (US$19.2 billion in the US), US$4.3 billion in the EMEA region, and US$460 million in the ASPAC region.
• Global PE funding was also very soft with US$1.1 billion in funding in H1'23, including US$768 million in the Americas (US$627 million in the US), US$279.5 million in the EMEA region, and US$60.5 million in the ASPAC region.
• Corporate-participating funding accounted for US$16.7 billion in funding during H1'23, including US$10.8 billion in the Americas (US$10.4 billion in the US), US$3.1 billion in the ASPAC region, and US$2.7 billion in the EMEA region.
• Payments accounted for US$16.2 billion of funding in H1'23, while artificial intelligence and machine learning focused fintech attracted US$8.8 billion, supply chain and logistics focused fintech attracted US$8.2 billion, and insurtech attracted US$4.7 billion.

1. The US accounts for more than two-thirds of H1'23 fintech funding
The US took the lion's share of fintech funding in H1'23, its US$34.9 billion in funding accounting for more than two-thirds of the US$52.4 seen globally. The US also attracted five of the seven US$1 billion+ fintech deals of H1'23, including the US$8 billion buyout of Coupa by Thomas Bravo, the US$6.9 billion VC raise by Stripe, the US$4 billion acquisition of EVO payments by Global Payments, the US$2.6 billion buyout of Duck Creek Technologies by Vista Equity Partners, and the US$1.8 billion buyout of Moneygram by Madison Dearborn Partners LLC. The EMEA region and ASPAC regions each attracted a single US$1 billion+ deal during H1'23; in EMEA, UK-based Wood Mackenzie was acquired by Veritas Capital for US$3.1 billion, while in ASPAC, China-based Chongqing Ant Consumer Finance held a US$1.5 billion VC funding round.

2. EMEA region sees falls more than 50 percent in funding between H2'22 and H1'23
Total fintech funding in the EMEA region was just US$11 billion in H1'23—less than half the US$27 billion seen in H2'22. The UK attracted over half of this amount (US$6 billion), including the US$3.1 billion buyout of Wood Mackenzie by Veritas, a US$602 million raise by AI-powered lending company Abound, and a US$250 million raise by e-trading platform eToro. While other countries in the region lagged far behind the UK's results, several countries attracted deals over US$250 million, including France (Ledger—US$493 million), Switzerland (Teylor—US$299 million; Metaco—US$250 million), and Mauritius (Bold Prime—US$250 million).

3. ASPAC sees fintech funding decline to US$5.1 billion in H1'23
Fintech funding in the ASPAC region dropped from US$6.8 billion in H2'22 to US$5.1 billion in H1'23—a far cry from the record-breaking six months experienced in H1'22 when fintech funding reached over US$45 billion. The largest fintech deal in the ASPAC region during H1'23 was US$1.5 billion raise by China-based consumer finance services company Chongqing Ant Consumer Finance. Other deals in the region during the quarter were significantly smaller, including the US$304 million buyout of India-based SME lending company Vistaar Finance by PE firm Warburg Pincus, the US$270 million raise by Singapore-based credit services firm Kredivo Holdings, and a US$200 million raise by India-based digital lending platform Creditbee.

4. Payments remains top fintech subsector with US$16 billion in funding in H1'23
Payments continued to attract a large share of fintech funding globally during H1'23, accounting for US$16.2 billion in funding, including the three largest deals of the quarter—the US$8 billion buyout of Coupa by Thomas Bravo, the US$6.9 billion VC raise by Stripe, and the US$4 billion acquisition of EVO payments by Global Payments.

5. Supply chain and logistics and green fintech buck downward trends
In H1'23, a number of growing fintech subsectors bucked downward trends, showing resilience and the ability to retain interest and funding despite current market challenges. In particular, supply chain and logistics-focused fintechs accounted for US$8.2 billion of fintech funding in H1'23—a record annual high with six months left in 2023. Green fintech attracted US$1.7 billion in funding during H1'23—already ahead of the sector's 2022's total results. Other sectors that saw strong funding in H1'23 included insurtech (US$4.7 billion) and B2B fintech (US$3.7 billion).

6. In an uncertain future, AI is expected to make big gains
With no end to many of the geopolitical and macroeconomic uncertainties in sight, fintech funding in H2'23 is expected to remain relatively soft—although if the market stabilizes, fintech funding could start to see a cautious rebound. One area well-positioned to see a strong uptick in interest from investors in H2'23 is artificial intelligence—and generative AI, in particular—as companies around the world look to leverage AI's full potential as part of efforts to improve both operational efficiencies and customer value.