India’s fintech funding dips to $1.9 billion in 2024, yet retains global standing
India’s fintech sector raised funding of $1.9 billion in 2024, a 33 per cent decline from the $2.8 billion secured in 2023 and a significant 66 per cent drop from the $5.6 billion raised in 2022.
Despite the decline, India remained the third-largest fintech funding hub globally, trailing only the US and the UK.
The third quarter of 2024 emerged as a bright spot, with $805 million raised, accounting for 42% of the year’s total. August was the most robust month, contributing $434 million to the annual total. However, only three funding rounds exceeded $100 million, half of the six recorded in 2023.
Neha Singh, Co-Founder at Tracxn, said, “Despite the global funding slowdown, India’s FinTech ecosystem continues to demonstrate remarkable resilience and adaptability. The emergence of two new unicorns and a record eight IPOs in 2024 underscore the sector’s ability to thrive amidst challenges. These milestones, combined with robust economic fundamentals and advancements in technology, highlight the strength of India’s FinTech landscape. As we look to the future, the sector is poised to build on these successes, driving financial inclusion and innovation while solidifying its position as a global leader in the FinTech space.”
Funding trends
The funding landscape in 2024 saw a significant shift, with only three $100 million-plus funding rounds recorded, marking a 50% decline from the six such rounds in 2023. Notable deals included DMI Finance raising $334 million in Series E funding led by MUFG. Additionally, Credit Saison, an online marketplace for consumer and business loans, secured $144 million in a Series D funding round.
The downturn was evident across all funding stages, with late-stage rounds being the most affected. Late-stage funding amounted to $1.1 billion, marking a 42% reduction compared to the $1.9 billion raised in 2023 and a sharp 65% decline from $3.1 billion in 2022. Early-stage rounds followed a similar trend, recording $562 million in funding in 2024. This figure reflects a 16% drop from the $667 million raised in 2023 and a substantial 70% decline from $1.9 billion in 2022. Seed-stage funding also faced challenges, reaching $178 million in 2024—down 19% from $219 million in 2023 and 66% from $529 million in 2022.
M&A activity
M&A activity saw a slight dip, with 26 acquisitions recorded in 2024, down 16% from 31 in 2023. Notable transactions included the $94.5 million acquisition of PureSoftware, an omnichannel banking solutions provider, by Happiest Minds, and the $44 million acquisition of ET Money, a mutual fund investment platform, by 360 One. The sector achieved a milestone with eight IPOs in 2024, a 300% increase compared to the two IPOs in 2023.
Bengaluru maintained its leadership as the top hub for fintech funding in 2024, followed by Mumbai and Delhi. Among investors, Peak XV Partners, LetsVenture, and Y Combinator emerged as the top contributors overall. Venture Catalysts, Y Combinator, and Antler led in seed investments, while Elevation Capital, GMO Venture Partners, and Peak XV Partners dominated early-stage funding. Late-stage investments were spearheaded by Creaegis, The Rise Fund, and Amara Partners.