Singapore fintech industry hits record activity levels but experiences sharp drop in financing

03/03/2023 12:58 • Metaverse & Beyond • 78 views

It is reported that according to the recently released data, the activity level of Singapore’s financial technology industry hit a record high in 2022, but the financing level fell sharply. According to the data of FinTech Global Research, Singapore-based financial technology companies conducted a record number of transactions in 2022, totaling 232 transactions. However, from 2021 to 2022, the financing level decreased by 29% to US $2.4 billion. The average transaction size further decreased by 39% to US $10.3 million. The largest transaction was conducted by Amber Group, a digital asset infrastructure provider, which raised $300 million from the latest round of financing.

Singapore Fintech conducted 232 transactions in 2022

Interpretation of the news:

The recently released data by FinTech Global Research reveals both good and bad news for the Singaporean fintech industry. On a positive note, the industry hit an all-time high in activity levels, with a total of 232 transactions made in 2022. However, the industry’s financing level experienced a steep fall. From 2021 to 2022, the financing level decreased by 29% to US $2.4 billion, with the average transaction size dropping by 39% to US $10.3 million.

The largest transaction within the year was conducted by the digital asset infrastructure provider, Amber Group, raising an impressive $300 million from their latest round of financing. This could serve as a beacon of hope for other fintechs in Singapore and promote their search for potential investors.

Nonetheless, Singaporean fintechs are not entirely gloomy, as despite the decline, the industry has still garnered significant funding from venture capitalists and angel investors. Although the drop may seem severe, it could possibly be attributed to external factors such as the pandemic and ever-changing regulations, where investors may have been more cautious about investing in fintechs.

Additionally, the lower financing level may have the advantage of promoting more sustainable growth in the industry. Fintechs may need to prove that their products or services are beneficial, providing them with a more grounded business model. This could potentially prevent the previous scenario of fintechs rising and falling rapidly, with companies that had previously received abundant financing, such as some Singaporean fintech startups, experiencing hardship when they ran out of funding.

In conclusion, the Singaporean fintech industry may have experienced a drop in financing but has, surprisingly, achieved a record high in activity levels. This increases the chances of promoting more sustainable growth within the industry, a win for both investors and fintechs, providing adequate backing for long-term success.

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