In the first quarter of 2024, funding for fintech startups fell by 16% compared to the previous quarter, in contrast to an 11% increase in total venture capital funding, which reached $58.4 billion. Global fintech funding1 fell due to shifting investor sentiment to the 2010 level. FinTech Insider writes about this.
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As noted in the CB Insights Q1 2024 State of Venture Report, during this period the fintech sector attracted $7.3 billion, which is the lowest figure over the past seven years. Funding this year is down 54.3% from the first quarter of 2023, when $16 billion was invested in 1,271 fintech startups.
The data shows a significant downward trend compared to the first quarter of 2022, when $32.9 billion was invested in 2026 fintech startups, highlighting a further decline in both funding volumes and the number of deals.
Despite decline, equity deal activity in fintech increased by 15%, indicating investor interest in payment technologies. However, the average deal size has decreased, due to a shift in emphasis towards larger investments in companies that focus on broad solutions in the field of artificial intelligence.
The report noted that fintech startups received 904 investments during the quarter. British Monzo Bank Ltd. raised the largest round of funding at $430 million, and Bilt Rewards received a $200 million Series C round, ranking third in the period.
U.S. companies led the way in funding, raising $3.3 billion in 393 deals , while European startups followed, raising $2.2 billion in 203 deals, reflecting the larger average size of funding rounds in Europe compared to the US.
A separate report highlights a significant decline in funding for African startups: In the first quarter of 2024, $466 million was raised, which is 47% less than in the same period in 2023.
Despite the historical role of fintech in the African technology sector, in this quarter the leader in terms of funding was the transport and logistics, which accounted for 32% of the total amount raised, eclipsing fintech's 23%.
