Financial technology refers to software that delivers banking, payments, and related services. Global fintech investments in 2021 reached record levels in every major region.
Investors’ interest in cryptocurrencies and blockchain was especially high, but the range of fintech services continued to expand and grow.
“Pulse of Fintech H2’21” (PDF) is a January 2022 report by KPMG, the accounting and consulting firm. According to the report, a record number of fintech deals drove overall global investment to $210 billion in 2021, with 5,684 total transactions (venture capital, private equity, and mergers and acquisitions).
The payments sector was the most popular fintech investment in 2021, attracting $51.7 billion, the lion’s share of global funding.
Courtney Trimble, KPMG’s global leader of payments, stated, “Investment in the payments space continues to boom, both in mature markets like the U.S. and U.K. — and in emerging markets like Africa, Latin America, and Southeast Asia. Throughout 2021, there’s been an extraordinarily high level of VC investment due to the nature of the global economic recovery combined with the digital transformation that has been accelerated by Covid-19.”
Investments in blockchain and cryptocurrency technology reached $30.2 billion in 2021, a new high.
KPMG’s Brian Heaver said, “This was arguably one of the most significant years ever for crypto in terms of retail adoption and investment. … while we don’t know where all the efforts are going to land, there’s a ton of curiosity and interest in the possibilities.”
CBInsights’ “State of Fintech” global 2021 report (PDF) also analyzes last years’ investments, breaking down the activity into sectors and regions. According to the report, Q4 2021 was the first quarter ever that Asia and the United States were tied in the “Banking” sector, each receiving 25% of the global deal share. Historically, investments in Asia were far greater.