How Singapore survived the global fintech funding fall

In Q2, the country's global market share by deal value jumped to 6.4%.

Whilst most markets across the globe are seeing a fall in investment in their respective fintech sectors, Singapore has stood strong and was able to weather the current market condition.

In an analysis, KPMG said Singapore even doubled its global market share by deal value to 6.4% in Q2 22 from 3.1% in FY2021, whilst its share in the number of deals went up to 5.1% from 3.4%.

The country's deal sizes have likewise grown up to 10% to average US$43.9m in Q2 22 from US$39.8m across FY2021.

"Singapore is holding its position well. As the trusted hub for high growth and rapidly digitising Asian markets, the diligence in developing an open, cross-border ecosystem is paying dividends," Anton Ruddenklau, Global Head of Fintech, KPMG International, said.

To add, KPMG said the local government and the Monetary Authority of Singapore have also set a "strategic path" that is aligned to the further drives of change across sustainable finance and digital assets.

The government, in particular, have policies and incentive programs such as the Regulatory Technology Grant program and the Digital Acceleration Grant program to speed up technology adoption in the financial sector.

MAS, for its part, has launched initiatives such as Project Greenprint and Projects Guardian and Dunbar.

"MAS’ Project Greenprint demonstrates a unique and ambitious system-wide approach to the innovation of Financial Services to support both Transition and Sustainable Finance," KPMG said in its analysis.

"Investors recognise that this is set for incredible growth and it will likely be stimulated by a new generation of technology entrepreneurs supporting change both within real economy sectors and financial services concurrently," it added.

Sustainable finance and other environmental, social and governance (ESG) technology classes such as agritech, carbon markets, and data services are expected to attract investment growth of up to 150.9% compound annual growth rate (CAGR) between 2017 to 2021.

Climate change is also one of the domains in which fintech investors are highly interested, alongside supply chain, financial and crypto market infrastructure, artificial intelligence and agritech, according to KPMG.

"Private capital investors such as private equity (PE) and venture capital (VC) firms are now refocusing their 2022 investments towards technology that will fuel industry transformation over the next ten years and beyond," KPMG said.

AS of June 2022, Singapore has 1,007 operating fintech firms, the highest amongst Southeast Asian countries.

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