Fintech Stages Rally with Staggering $5.3 Billion in Investments

April 18, 2016         By: Ryan Kennedy

With the slowdown in the global economy, analysts noted that the financial technology sector was seeing a slowdown in investments and enthusiasm.

Some analysts even went as far to say that the fintech sector was another bubble, similar to the tech stock bubble in the late 90s.

Although there was a brief slowdown in capital raising rounds over the first quarter of this year, it now appears that the fintech sector staged a rally late in the quarter.

Accenture, an industry favorite for financial technology research, released a report earlier in the week showing the staggering rally.

The firm looked at data from CB Insights and came to the conclusion that fintech investments were doing fine.

According to the report, fintech startups received $5.3 billion in funding in the first three months of the year.

That’s a 67 percent increase compared to the first quarter of last year. Another trend was also revealed by the report.

Collaborative ventures – meaning those that seek financial institutions as clients – grew to 44 percent of all fintech investments, up from 38 percent the year before.

Another metric from the report may explain the reason why some analysts believed fintech was cooling down.

The majority of fintech investments over the first quarter went to firms in Asia and Europe. This could be explained party due to the massive growth of fintech in Asia.

It could also be explained by the lack of institutional and governmental support of fintech in the US.

So far in the expansion of the financial technology sector, the US government and the US financial system have been slow to accommodate fintech, especially when compared to countries like the UK.