Fintech start-ups in India raised a total of $5.65 billion in 390 rounds in 2022, a drop of 47 per cent in terms of funding amount and 29 per cent drop in the number of rounds, as compared to 2021, according to data provider Tracxn.
India is still the third-highest funded country in terms of funding received in the fintech sector, only behind the US and the UK. This drop in funding can be attributed to the decline in late-stage funding from $8.3 billion in 2021 to $3.7 billion in 2022, which is a 56 per cent drop.
Growing inflation and macroeconomic tensions have made the investors step back from making big investment decisions. However, fintech has consistently been one of the top-funded sectors. It was the second-highest funded sector in 2022, after enterprise applications.
In 2022, fintech start-ups recorded 13 funding rounds of $100 million+ in value. This is a massive drop of 50 per cent, from 26 rounds in 2021. Y Combinator, Tiger Global Management and Lets Venture were the most active investors in the space, with more than 20 investments in 2022. Only four start-ups in India’s fintech sector received unicorn status in 2022, far lower compared with 13 new unicorns in 2021, the report said.
In terms of cities, fintech companies in the Delhi-NCR region (Delhi, Noida and Gurgaon) have raised a combined funding of $14.9 billion till date, followed by Bengaluru ($10.2 billion) and Mumbai ($4.2 billion).