The Weekly Wrap: all you need to know by Friday COB | April 14th

By Puja Sharma

The Weekly Wrap is published every Friday and recaps the week’s main stories and deals, as well as upcoming events and announcements. For Prime subscribers only.

The Big Story

Investments in FinTech startups in the country totaled $1.2 billion in the first quarter of 2023, 55% less than in the first quarter of 2022 when $2.6 billion was raised. According to Tracxn, a SaaS-based market intelligence platform, this is a sharp increase of 126% compared to the $523 million raised in the fourth quarter of 2022.

Tracxn, in its Geo Quarterly FinTech India Report – Q1 2023, said that in the FinTech space, India is the second-highest funded geography after the U.S. in Q1 2023, and occupies a spot in the top five geographies in terms of total funding activities. However, the funding is still on a declining trend when compared with previous years, although there has been an uptick in funding over the past few quarters.

The sector recorded late-stage investments of $977 million in the first three months of 2023, a spike of 325% when compared to Q4 2022 but a drop of 44% from Q1 2022. Early-stage funding during the quarter was $177 million, down 30% and 76% from Q4 2022 and Q1 2022 respectively. Seed-stage funding of $30.2 million was observed during this quarter, a fall of 21% and 74% from Q4 2022 and Q1 2022 respectively.

Sequoia Capital, AngelList, and Y Combinator are the most active investors in India’s FinTech space. Y Combinator, LetsVenture, and Premji Invest were the top investors in Q1 2023. Y Combinator, 100X.VC and LetsVenture were the top seed-stage investors. Xceedance, Telama Family Office, and CourtsideVC were the top early-stage investors, while Premji Invest, General Atlantic, and TVS Capital Funds were the top late-stage investors.

According to the report, it was an uneventful quarter in terms of IPOs and Unicorns. No companies from the FinTech space went public in Q1 2023, and there were no new entrants to the Unicorn club. However, there was a slight uptick in acquisitions. The sector witnessed 11 acquisitions in Q1 2023, as against six acquisitions in Q4 of 2022.

Among Indian cities, FinTech companies in Bengaluru take the lead, raising $796 million in the first quarter of 2023. This was followed by Mumbai and Gurugram, which raised $222 million and $151 million respectively, during the quarter.

India continues to be an attractive market for FinTech investors for several reasons. Digital payment solutions have received widespread acceptance within the country.

Deals of the week

• Malaysian FinTech Soft Space raises $31.5m in Series B1 funding
• Peach Payments raises $31m Series A funding led by Apis Partners
• Santander, Microsoft & Oxentia Foundation team to launch AI challenge
• Worldline partners with SignCatch to roll out Merchant Digitisation Programme
• Mastercard launches new Cross-Border Services Express
• Tranglo unveils cross-border SEPA payout for Europe
• Fenergo adds AI-based Transaction Monitoring to solution portfolio
• BaaS provider Unit enters strategic partnership with Pacific West Bank
• Central Payments renews partnership with Galileo Financial Technologies
• Capital Bank goes live with Finastra to scale up corporate banking
• Cashinvoice partners with Hero Fincorp to extend digital financing to MSMEs

Be on the lookout for

FinTech Nexus USA 2023, the event for the fintech industry, is set to take place at the Javits Center in NYC on May 10-11, 2023. The event will bring together top executives, innovators, investors, and experts to network, learn, and discuss the latest trends and developments in fintech.

Fintech Nexus USA will feature a packed schedule of keynotes, panel discussions, workshops, and networking opportunities, covering a range of topics, including digital banking, fraud, credit & underwriting, payments, lending, financial health, embedded finance, fintech investing and more. The event kicks off with keynote Stephanie Cohen, Global Head of Platform Solutions, Goldman Sachs, while Simon Khalaf, CEO, of Marqeta, will make his first stage appearance since being appointed to lead Marqeta. He will speak about “Why Embedded Finance Holds the Keys to Modernization.

In addition, discussions around fraud solutions will be prominently featured during the Fraud Fight Club track in partnership with About Fraud; Deloitte will again sponsor the popular Women in Fintech Networking and Luncheon; and one startup will be crowned PitchIt champion in the annual PitchIt at Fintech Nexus USA startup competition.

“FinTech Nexus USA 2023 is a must-attend event for anyone in the FinTech industry,” said Bo Brustkern, Co-Founder & CEO, of Fintech Nexus. “The event provides a platform for attendees to network, learn, and share ideas with industry leaders and experts, and we’re excited to bring together such a talented group of individuals for this year’s event in the financial capital of the world.”