Fintech Funding and Dealmaking in 2024 Declined, Hitting Lowest Levels in 7 Years – Report

From a 7-year low in dealmaking to M&A gaining steam, industry researchers break down key changes in the fintech landscape using CBInsights data.

Fintech funding and dealmaking declined again year-over-year (YoY) in 2024, hitting their “lowest levels in 7 years,” the report from CBInsights revealed.

But the extensive report pointed out that some positive signals are emerging, including “growing deal sizes and a pickup in M&A, with a focus on cybersecurity capabilities.”

Fintech dealmaking continues “downward trend in 2024.”

Annual fintech deals and funding both dropped to 7-year lows in 2024.

While deals dropped by “17% YoY to a total of 3,580, funding fell by 20% to $33.7B.”

One positive signal: bigger deals.

The median fintech deal size increased to $4M in 2024 — marking “a 33% jump YoY — with deal sizes rising across every major global region.”

Across fintech sectors, the biggest jump “occurred in banking, where the median deal size rose by 70% YoY to reach $8.5M.”

Though fintech saw fewer deals overall in 2024, the “increase in deal sizes suggests that investors are writing bigger checks for companies with compelling growth potential.”

M&A activity is also picking up, the report from CBInsights revealed while noting that Fintech M&A exits jumped “24% quarter-over-quarter (QoQ) to 189 in Q4’24, with Stripe’s $1.1B purchase of stablecoin platform Bridge marking the quarter’s largest deal.”

Overall, fintech saw a total of “664 M&A exits in 2024 (up 6% YoY) as financial services companies sought to diversify their capabilities and build full-service platforms.”

The report from CBInsights noted that “mature banking companies are catching the eyes of investors.”

Banking saw mid- and late-stage deals rise to “38% of its total deal volume in 2024 (vs. 21% in 2023), outpacing the 4 percentage point increase in fintech more broadly.”

Uncertainty about new banking technology and regulatory volatility — particularly among banking-as-a-service players — is “likely driving investors to more proven solutions.”

Payments tech ends 2024 as a “bright spot.”

Five of the top 10 equity deals in Q4’24 went to companies “building payments solutions, from mobile payments apps to cross-border payments enablement tools to platforms digitizing B2B payments.”

According to the report from CBInsights, this concentration of large deals within payments tech “reflects the ongoing push to digitize commerce and business exchanges.”

In 2024, annual fintech funding and dealmaking both “decreased YoY, hitting 7-year lows.”

But there are signs that the fintech market is “steadying.”

The CBInsights report noted that the annual decline in funding “was fintech’s smallest in 3 years.”

Meanwhile, at the quarterly level, funding rebounded “to close the year strong, increasing 11% QoQ to reach $8.5B in Q4’24.”

While there are fewer fintech deals overall, “deal sizes are climbing.”

Following 2 consecutive years of decline, the median deal size “in fintech jumped 33% YoY in 2024.”

Across fintech sectors, banking saw the “biggest jump in median deal size in 2024 — a 70% YoY increase to $8.5M.”

This shift reflects increased investor “selectivity in the current market. Companies that pass more rigorous due diligence are attracting larger investments, even as overall deal volume remains constrained.”

Fintech M&A deals jumped 24% QoQ in Q4’24, the report revealed.

CBInsights also noted that US-based companies captured 8 of the largest 10 deals, “including the top 5.”

$1.1B acquisition of Bridge was the “largest of the quarter.”

The research report added that quarterly increase points to “broader stirrings of an M&A resurgence: for the year, fintech M&A exits rose by 6% YoY to 664 deals in 2024.”

Acquirers are boosting capabilities “across functions.”

For example, Stripe’s purchase of stablecoin platform Bridge gives the company a “stronger standing in the reinvigorated market for digital assets and boosts its cross-border payment capabilities.”

The deal also emphasizes stablecoins’ growing role in “driving accessibility and stability within crypto’s current wave.”

CBInsights also shared that bolstering cybersecurity was also a focus “for acquirers in Q4’24, pointing to financial services companies’ push to integrate fraud detection in their product offerings.”

For example, in November 2024, IT company N-able bought Adlumin, which deploys its “solutions to financial firms, to enhance its cybersecurity capabilities.”

In October, Socure — specializing in digital identity verification — acquired Effectiv to “enhance its AI-driven fraud detection capabilities.”

The CBInsights report further revealed that early-stage deals made up a larger share of fintech investment activity in 2022-23, “suggesting that investors shifted their focus toward nascent innovation requiring smaller capital commitments during the market slowdown.”

The report from CBInsights added that the trend shifted in 2024, particularly in the banking sector.

Although mid- and late-stage deal share rose by “4 percentage points YoY across fintech broadly, it jumped 17 percentage points in banking.”

The research report pointed out that recent volatility in banking-as-a-service — such as Synapse’s bankruptcy in April — and intensified “regulatory scrutiny are likely driving investors to more proven solutions.”

As noted in the report from CBInsights, five of the 10 biggest fintech deals in Q4’24 went to payments companies, “capping a relatively strong quarter for the sector. Despite a YoY decline, funding to payments companies rose by 20% QoQ to $1.8B in Q4’24.”

The research report also mentioned that Argentina-based mobile payments company Ualá secured “a $300M Series E in Q4’24, tying home equity release firm Splitero for the largest round of the quarter.”

CBInsights pointed out that of the top payments deals, “two went to companies automating accounts payable and other aspects of B2B payments (Melio and ASAAS).”

CBInsights concluded that the opportunity to digitize B2B payments continues to expand, “especially since businesses in many geographies still rely on manual processes.”



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