Fintech investments in Singapore have climbed to the highest in three years, with cryptocurrency and blockchain still capturing top dollars.
Investments for the sector grew 22% to hit $4.1 billion last year, clocking 250 deals in mergers and acquisitions, private equity, and venture capital. The number was the second-highest fintech investment over the past decade, where investments topped at $5.62 billion in 2019, just before the global pandemic landed, according to the latest KPMG Pulse of Fintech report.
Across the globe, fintech investments reached $164.1 billion across 6,006 deals last year, down from a record $238.9 billion from 7,321 deals in 2021. The top three investment areas in 2022 were payments, followed by crypto and blockchain, and regtech (regulatory technology).
In Singapore, funds were funnelled towards the top three areas of crypto and blockchain, payments, and wealthtech. Blockchain and crypto also saw high investment interest the year before in 2021, when the category raked in almost half of total funds, raising $1.48 billion across 82 deals.
Across the Asia-Pacific region, fintech investments saw a slight increase to $50.5 billion in 2022, up from $50.2 billion in 2021. Specifically, the second half of 2022 saw just $5.8 billion in fintech investments, compared to $44.6 billion in the first half.
The KPMG report pointed to Block’s $27.9 billion acquisition of Australian buy now, pay later vendor Afterpay, which accounted for more than half of the regional investments. The buyout pushed Australia to the front of the pack in Asia-Pacific, clocking $20.2 billion in fintech investments.
India’s $6 billion investment, alongside Singapore’s $4.1 billion, dwarfed China’s fintech investment pool, which clocked at just $770 million.
The Americas remained the leading region for fintech investments, accounting for $68.6 billion last year, with the US making up the bulk at $61.6 billion. The EMEA region recorded $44.9 billion in fintech investments.
Across the globe, payments took the largest share of fintech funds, while regtech saw the highest growth to hit $18.6 billion in 2022, up from $11.8 billion the year before.
Singapore’s state-owned investment firm Temasek Holdings last November said it would write down its investment in troubled cryptocurrency exchange FTX, stating its belief in disgraced founder Sam Bankman-Fried was “misplaced”. Temasek had participated in two funding rounds, totalling $275 million in investment.
Local bank DBS this week said it registered an 80% year-on-year growth in the number of Bitcoin traded last year on its DBS Digital Exchange. The number of Bitcoin custodised with the bank’s digital asset custody platform also doubled, it added.
The number of Ether traded on the exchange climbed almost 65% in 2022, while the amount of the crypto custodised with DBS grew more than 60%.
The Singapore bank has just under 1,200 customers registered with the digital exchange, as of December 31, 2022.