Asia has taken the global lead in funding fintech startups reports Forbes. Average funding received per company by region is as follows:
- Asia: $34.6 million per deal (130 deals)
- US: $20.4 million per deal
- Europe: $12 million per deal
More fintech companies are being backed by venture capital funding at 33% annual growth.
Crowdfunding, cross-border transactions, P2P lending, mobile and electronic payments are some of the startups that have vastly enhanced the performance of financial operations across different consumer segments. According to a survey conducted by Ernst & Young, the top reasons for utilizing fintech services among consumers are:
- Convenience in the account setup procedures
- More attractive rates and fees
- Better quality service and products
The top reason for not using fintech services is lack of awareness as 53% respondents agreed with this statement, according to the survey.
According to research firm Celent, more than 75% of estimated investments are put towards maintenance, meaning that money is mostly spent on monitoring rapidly changing regulations and not innovating new technologies. This seems to be a global trend in the financial technology sector, as Thailand’s government is working to relax regulations. Singapore reports to have set up a regulatory ‘sandbox‘ to facilitate fintech development and Malaysia has also been working to improve regulations to enable fintech acceleration.
Despite Asia attracting the most funding, it doesn’t necessarily mean that fintech growth is accelerating at a fast speed, as reports showed that investments in Asia for Q2 have slowed down compared to the same period last year.
A version of this appeared in Forbes on July 20. Read the full version here.