Global Fintech Funding Surpasses $9 Billion in Q2 2020, More Merchants Accepting Payments from Digital Wallets Following COVID-19: Report

The Fintech sector managed to secure more funding, globally, during Q2 2020 than it did during the first quarter of the year, according to a recent report from CB Insights.

The report noted that the Fintech industry in all major world regions, except for Asia, attracted more capital this past quarter when compared to Q1 2020. In Asia, the total funds raised by financial technology companies declined by 37% this quarter, when compared to the first quarter of this year.

Although total Fintech funding increased this past quarter, there were fewer deals that were finalized.

Fintech funding surged 17% on-quarter from roughly $7.9 billion to $9.3 billion, the CB Insights report revealed. However, it did not take into account the capital acquired by startups backed by angel investors, private equity companies, or through other financing methods such as raising debt or line of credit based transactions.

There are significantly more non-financial firms that are adding financial products to their product offering. For instance, there are many more merchants now that also accept payments via digital wallets, whereas before they only took cash or credit cards.

The COVID-19 outbreak, which has now infected well over 18 million people globally, has accelerated the shift towards digital platforms and services. The pandemic has led to considerably more consumers taking care of their daily shopping needs online – which has provided a significant boost to the digital commerce sector.

Mega-rounds, where Fintechs secured over $100 million in total investments, reached 28 – which is notably a new quarterly high.

Global Fintech deal activity fell from 452 deals during Q1 2020 to only 397 in Q2 2020.

An analysis provided by S&P claims that Fintech funding in the US is on pace to beat last year thus performing well even during a COVID challenged economy.

According to S&P, investor interest in private Fintech companies has “remained evergreen.” S&P Global Market Intelligence estimates that funding for private US fintech companies in 2020 will top the levels seen in 2019, both in terms of value and volume.

Fintech funding in the UK declined during H1 2020, but challengers Revolut, Starling Bank, Checkout.com, and Onfido closed mega $100 million+ rounds.

India’s Fintech sector received $1.47 billion in investments during H1 2020. Ther are 2,147 Fintechs operating in the country as of June 2020

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