Total fintech investment and deals activity in the Asia-Pacific region saw a solid rebound in the first half of 2021. After falling to US$4.7 billion across 357 deals in H2’20, H1’21 saw US$7.5 billion in investment across 467 deals. While both deal volume and value remained well shy of the record US$25 billion across 504 deals seen in H1’18, the increased activity – particularly without any very large megadeals – is a positive sign for continued fintech investment in the region. Key H1’21 highlights from the Asia-Pacific region cover the topics below.
Platform players with strong fintech offerings continue to be very hot in the Asia-Pacific region, with many working to build their breadth, reach, and market share. Indonesia-based Gojek raised US$300 million in H1’21, while also announcing a merger with payments and eCommerce platform Tokopedia.
Across the Asia-Pacific region, jurisdictions continued to take very different approaches to cryptocurrencies and crypto exchanges. In H1’21, China banned banks from providing cryptocurrency-related services,1 whereas Hong Kong’s Financial Services and the Treasury Bureau recommended all virtual asset exchanges in Hong Kong (SAR, China) be licensed and limited with professional investors.
Given the explosion of US-based SPACs in recent quarters, startups – including mature fintechs – in the Asia-Pacific region are expected to gain more interest from US-based SPACs looking to make deals. During H1’21, Singapore-based super app company Grab announced the largest SPAC merger ever: a US$40 million deal with US-based Altimeter Growth Corp, which is expected to be finalised in H2’21.2
The payments space was incredibly robust across the Asia-Pacific region in H1’21, with the ‘buy now, pay later’ space considered to be one of the fastest growing subsectors.
Investors continue to see significant opportunities across the Asia-Pacific region to better reach unbanked and underbanked. In India, for example, a number of fintech unicorns are working to become the core player between an individual and banking, insurance, or wealth management offerings.
VC investments surge and cross-border M&A more than doubles all of 2020.
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