Covid-19 Impact on Banks, And fixes. The Black Swan Opportunity

Download Now

The Black Swan Opportunity |Get your bank digital ready.

IBSI Special 5 Digital Report Package with Special Offer. Subscribe now

IBS Journal: The iconic monthly FinTech magazine

April 2020 issue out now! Subscribe now

India FinTech Report 2020

Insights into the historical and projected market size of key FinTech categories. Subscribe now

European FinTech sees record funding with $58.1 billion in 2019 – KPMG

Europe has seen a banner year for FinTech with $58.1 billion in funding, compared to $43.4 billion in 2018, according to a KPMG report.

Anton Ruddenklau, Global Co-leader of Fintech at KPMG International

Anton Ruddenklau, Global Co-leader of FinTech at KPMG International

The Pulse of FinTech H2 2019 report from KPMG showed that the European record was mainly due to FIS’ acquisition of WorldPay – at $42.5 billion, it accounted for more than half of the total. Moreover, the investments were increasingly diversified, as the ten biggest deals stretched across six countries, and VC funding set a new record with $7.2 billion.

Globally, investments fell short as 2018 was a record year; $137.5 billion was invested in 2019 compared to $141 billion in 2018. The number of deals by global tech giants such as Alibaba Group, Alphabet, Apple, Baidu, IBM, Microsoft and Tencent increased for the fifth year, with $3.5 billion invested across 46 deals.

Cybersecurity-related investment more than doubled year-over-year, from $316.9 million to $646.2 million, corporate VC investments grew every quarter, and global M&A rose in size, from $91 billion to $ 97.3 billion, but the number of deals dropped from 622 to 426.

“Over the past year, the lines have really started to blur between financial services and non-financial services – with FinTech companies helping to bridge the gap,” Anton Ruddenklau, Global Co-leader of FinTech at KPMG International, said.

“It’s a trend that will only continue into 2020. Just look at how the big tech giants are working with both traditional financial institutions and FinTechs in order to seamlessly integrate financial services within their ecosystems, and at how the larger FinTechs and financial institutions are looking at ways to broaden their offerings into adjacent areas.”

Commenting on the European numbers, Ruddenklau said: “Payments is going to be very hot over the next year in the UK. There will likely be more mega-deals like Worldpay focused on the payments space as companies look to acquire customers and data. We’re also going to see payments firms looking to bolt-on open banking and data capabilities so that they can drive more success from mining their own data.”

The US also saw a new record, with $59.8 billion in investment against $58 billion in 2018, due to large corporate investments and deals such as the acquisition of First Data by Fiserv and Assurance IQ by Prudential. FinTech investments in the Americas in total dropped from $65.5 billion in 2018 to $64.2 to 2019.

FinTechs in the Asia Pacific region received $12.9 billion across 547 deals, with the biggest deals coming from India, Australia and South Korea. The overall number was lower than last year, mainly due to Ant Financial’s $14 billion raise.

Also commenting, Ian Pollari, Global Co-Leader of FinTech at KPMG International, said: “A number of companies from outside of financial services are working to get into parts of the financial services value chain – either directly or through partnerships – and they’re going to blur the lines of financial services even more. As a result, we expect to see bolder responses from incumbent financial institutions in terms of partnerships, as well as strategic investments and M&A.”

Related Posts