Despite a lower volume of investments overall, the payments sector led fintech investments in 2020, according to a report by KPMG.
Fintech investment plunged by $63 billion with 611 fewer deals in 2020. KPMG attributes this fall to fewer big-value mergers and acquisitions like FIS’ $42.5 billion acquisition of WorldPay in 2019. While fintech investments lagged in the first half of the year, the second half saw some recuperation as the industry adjusted to the new normal. In the second half, fintech investments surged to $71.9 billion for a total investment volume of $105.3 billion across 2,861 deals.
Much of this recuperation in investment volume can be attributed to investments made in the second half of 2020. Global venture capital investments in fintech actually did much better than M&A and private equity, reaching a high valuation of $42.3 billion — second only to 2018 when $53.8 billion worth of VC investments poured into the sector. Robinhood claimed the largest VC investment in 2020 with $1.3 billion across two deals in 2020.
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