Fintech start-ups in India raised $5.65 bn in 2022, a 47% drop from 2021

NEW DELHI: Fintech start-ups in India raised $5.65 billion in 390 rounds last year, a massive drop of 47 per cent in terms of funding amount and 29 per cent in the number of rounds when compared with 2021, a report showed on Thursday.

This drop in funding can be attributed to the decline in late-stage funding from $8.3 billion in 2021 to $3.7 billion in 2022, a drop of 56 per cent, according to data provided by global software-as-a-service (SaaS)-based market intelligence platform Tracxn.

Fintech start-ups recorded 13 funding rounds of $100 million+ in value. This is a massive drop of 50 per cent, from 26 rounds in 2021.

Y Combinator, Tiger Global Management and Lets Venture were the most active investors in the space, with more than 20 investments in 2022. Only four start-ups in India’s fintech sector received unicorn status in 2022, far lower compared with 13 new Unicorns in 2021, said the report.

Among the cities, fintech companies in the Delhi-NCR region (Delhi, Noida and Gurugram) have raised a combined funding of $14.9 billion till date, followed by Bengaluru ($10.2 billion) and Mumbai ($4.2 billion). India is still the third-highest funded country in terms of funding received in the fintech sector, only behind the US and the UK, said the report.

PhonePe raises $350 mn via General Atlantic

Meanwhile, fintech platform PhonePe has said it has raised $350 million in funding from General Atlantic, a leading global growth equity firm, at a pre-money valuation of $12 billion. Marquee global and Indian investors also participated in the round. The investment marks the first tranche of an up to $1 billion total fundraise that commenced in January 2023.