Feedback. India's fintech sector recorded a decline in funding activities in 2024, according to Tracxn FinTech Report. The sector received funding of 795 million in 2024, a decline of 11 percent and 59 percent compared to 896.7 million raised in H2 of 2023 and 1.93 billion in H1 of 2023, respectively. Only two 100 million funding rounds took in 2024 so far. Bengaluru led the funding in the Indian fintech space, followed by Mumbai and Pune. Peak XV Partners, Y Combinator, and LetsVenture emerged as the leading investors in the sector. Tracxn, a leading market intelligence platform released its Geo Annual India FinTech Report H1 2024 on funding trends, segment performances and notable developments in the Indian FinTech sector for 2024. However, India s fintech ecosystem achieved a significant milestone in H1 2024, ranking among the top three funded globally alongside the US and UK. Despite this achievement, the sector has faced substantial funding challenges. This decline reflects global trends influenced by the ongoing funding winter and geopolitical uncertainties, despite the robust performance of the Indian economy, which registered an 8.2 percent GDP growth rate for FY24 and is projected to maintain a 7.2 percent rate in FY25. Stagewise break up. Latestage funding in H1 2024 stood at 551 million, a 26 percent increase from 436 million in H2 2023 but a 63 percent decrease from 1.5 billion in H1 2023. Earlystage rounds recorded 179 million, showing a significant decline of 55 percent from 401 million in H2 2023 and 50 percent from 361 million in H1 2023. Seedstage funding amounted to 65 million, a 7.4 percent rise from 60.5 million in H2 2023 but a 43 percent reduction from 114 million in H1 2023. According to the report, a quarterly analysis revealed that Q1 2024 contributed 582 million to the total funding, representing a 55.6 percent drop from 1.31 billion in Q1 2023. The Q2 of 2024 saw only 214 million in funding, a 65 percent decrease from the same period last year. Two funding rounds of over 100 million were recorded in H1 2024 compared to just one in H2 2023. Noteworthy rounds included Avanse s 120 million Series C and Credit Saison s 144 million Series D, underscoring continued interest in key players despite overall funding declines. Top performers. Alternative lending, RegTech and BankingTech were the topperforming segments in the Indian FinTech sector. The alternative lending segment secured 646 million, which, despite being a 17.4 percent increase from H2 2023, marked a 27 percent fall from H1 2023. This segment alone accounted for 81 percent of the total funding in the Indian FinTech space, driven by digital lending solutions that enhance financial inclusion across the country. The RegTech sector saw a 50 percent drop in funding, accumulating 118 million compared to H2 2023 s 238 million, while Banking Tech received 115 million, down 65 percent from 328 million in H2 2023 but up 118 percent from 52.8 million in the same period last year. Neha Singh, CoFounder at Tracxn, said, Despite the global funding slowdown, India s FinTech ecosystem shows agility and adaptability, supported by robust economic fundamentals. The slowdown in funding reflects the need for a cautious outlook and strategic planning among startups and investors. Our FinTech sector remains dynamic, and we are optimistic that a supportive policy environment and technological advancements will create new opportunities for growth and innovation in the near future. . Meet the investors. Peak XV Partners, Y Combinator and LetsVenture were the alltime top investors in FinTech funding space. Venture Catalysts, Y Combinator and BeeNext led the seed investments; Peak XV Partners, Sorin, and Quona were prominent investors in earlystage investments; and Epiq Capital Advisors, UCRNT Fund, and Amara Partners were the leading latestage investors in 2024. Perfios emerged as the only unicorn in H1 2024, while there were no unicorns in the same period in 2023. Acquisition activity also witnessed steep decline at six acquisitions, a 66 percent decline, compared to 18 in H1 2023. Additionally, five companies went public in the first half of 2024, contrasting with no IPOs in the corresponding period last year. Copyright 2024 Living Media India Limited. For reprint rights: Syndications Today. Market. BT TV. Reels. Menu. Menu
India's fintech sector sees decline in funding activities in 2024, with 795 million raised. Bengaluru leads funding, while Peak XV Partners, Y Combinator, LetsVenture top investors. Despite challenges, India ranks top three globally in funding, with peak XV Partners, Sorin, Quona prominent in early-stage investments. Perfios is the only unicorn in H1 2024.