Fintech venture capital may reach US$1.88tn by 2028
The fintech venture capital landscape worldwide reflects the rapid evolution of financial technology and its increasing importance in the global economy. Using data from Tracxn, analysts of UnaFinancial considered venture investments in fintech startups in the world by the following sectors: digital payments and transfers, e-commerce, digital lending, digital investing, digital banking, digital insurance, wealth management, and cryptocurrency.
They found that at the end of 2023, the volume of fintech venture investments worldwide amounted to $1.06tn. According to an optimistic forecast by UnaFinancial, the volume of investments in fintech startups could increase by 77% to $1.88tn by 2028.
The most attractive segments globally are e-commerce ($494.2bn as of 2023), digital payments and transfers ($213.2bn), and digital lending ($204.7bn). Digital investing and digital banking occupy the fourth and fifth places, respectively.
Being a fintech hub, North America makes the largest contribution to the industry development – by the end of 2023, the volume of venture capital there amounted to $453bn. According to an optimistic forecast, it could grow by 84% and reach $834bn by 2028. Key drivers for further growth could be increased public trust in fintech companies and the development of the cryptocurrency sector.
Asia ranks second by fintech venture investment volume, with $369bn in 2023, which may grow to $548bn (+49%) by 2028. Drivers for positive change include an evolving regulatory framework and the region’s high level of fintech adoption.
The third continent with significant investment is Europe, with $188.8bn in 2023. The optimistic forecast for 2028 is $383.8bn (+103%). The further growth could be driven by the development of open banking and improved economic conditions in the region.
South America ranks fourth with $30bn invested in fintech startups in 2023, followed by Australia ($12.8bn) and Africa ($9.6bn). By 2028 the fintech investment volumes in these regions will grow to $35, $22.4 and$ 22.2bn respectively.
